Just a shell and waiting on sorting out the complicated finances re pensions - claims - property etc .....

No one should even think about it ..... I have just a few as a long term punt as I noted someone buying over and over again .... and they shouldn't be buying


ains




0.09.02 :-2.5, (2.0) of the results, Chairman said: "All trading ceased following the disposal of the business, trade and assets of Serck Controls Limited on 18 January 2002. The Group incurred an operating loss of 2,279,000 (2001:1,106,000) before exceptional charges of 2,863,000 (2001:39,594,000) on sales of 5,675,000 (2001:37,999,000). This resulted in a loss on ordinary activities before interest of 5,142,000 (2001:loss of 40,700,000).

Net assets at 30 June 2002 of 3,526,000 primarily comprised cash of 5,762,000 less liabilities and provisions. Since the final disposal was completed, they have been in discussions with third parties to explore the prospects for a merger which they believe to be the optimum way forward and which will offer shareholders the best potential rewards. They have examined over forty companies and held discussions with many of them. While they have conducted negotiations with several of these companies, they have not been able to reach agreement to proceed for a number of reasons. Among those reasons they have found on the one hand that private owners, notwithstanding the current market conditions, ascribe values to their companies which, in their and their advisers' view, are extremely optimistic. On the other hand, some of the remaining issues in Roxspur, notably pensions, have deterred some companies from proceeding with the company. Indeed, their most promising opportunity fell through following the recent referral of a claim to the Pensions Ombudsman.

Given the materiality of these issues the company commissioned an independent specialist legal report which fully supports their previous advice that these claims are not payable by the Group. Whilst they have prepared these preliminary results on this basis, they cannot be certain of the outcome until decisions have been made by the Ombudsman and other relevant bodies in some months time. In the unlikely event that the claims succeeded in full, their magnitude might be such that the Group could be rendered insolvent.

The Directors, based on the legal and professional advice received, are confident that the claims will not succeed and accordingly have continued to adopt the going concern basis in these preliminary results. With the acquisition over the years by the Group of a number of public and private companies, there have always been a large number of non-trading and dormant subsidiaries in addition to those listed in the Annual Report. At the beginning of this year these companies totalled seventy two. During the course of this year, by a process of liquidation and striking off, this total has been reduced to fifteen which are currently held primarily for resolution of outstanding tax treatments. Considerable detailed work has been necessary in resolving this particular issue.

The operating loss on discontinued activities before exceptional costs comprise the results of all businesses up to the date of their disposal including the results of Serck Controls Limited which made an operating loss of 656,000 prior to its sale. The operating loss from continuing operations relates to head office costs, which amounted to 725,000 in the 6 months to 31 December 2001 and 186,000 in the 6 months to 30 June 2002.

The reductions in the second half year were achieved through redundancies of Group directors and head office staff together with a continuing review of overheads to minimise ongoing costs. Exceptional costs in the year related to additional pension provisions of 675,000 commented upon further below, together with closure costs of 332,000. The loss on disposal of discontinued operations (1,856,000) relates to the sale of the companies and businesses referred to above and comprises a surplus over the book value (8,180,000) representing the difference between the proceeds of sale net of costs, and the net assets sold less goodwill previously eliminated against reserves on original acquisition of these businesses (10,036,000). A further 37,520,000 of goodwill was written back through the profit and loss account last year in respect of these businesses. 14,964,000 cash, net of costs, was generated from the sale of businesses during the year.

Following the sale of Horstmann Group Limited and Roxspur Measurement & Control in July 2001, the company repaid all borrowings and at 30 June 2002 had a positive cash balance of 5,762,000. The Group benefitted from net interest income of 148,000 in the year. Whilst the loss for the financial year was 5,232,000, this is stated after charging 10,036,000 goodwill previously written off to reserves. Accordingly, despite the loss for the year, net assets have increased from (1,286,000) to 3,526,000 at 30 June 2002 reflecting the surplus against book values on disposals.

The net assets at 30 June 2002 amounting to 3,526,000 primarily comprise cash of 5,762,000 less outstanding liabilities. These include taxation of 250,000, provision for pension liabilities of 1,400,000 and provisions amounting to 498,000 in respect of leased properties sublet to non-group companies at rents lower than the rental payable by the Group...

We continue to view the opportunity to merge with another company, public or private, who can use our cash resources for the profitable growth of their business as the best way forward for our shareholders. However, it has now become apparent that the prospects of such a merger are likely to remain uncertain pending resolution of the key pension issues. The alternative of liquidating the Group, would also be problematic and no distribution could be made pending resolution of these issues.

The pension issues are particularly material to the Group. Following initiation of the winding up of all the Group's pension schemes, the trustees are claiming up to an estimated 4.5m in excess of the provision of 1.4m in these preliminary results. These claims relate to amounts which we consider to be without foundation since they fall outside the Group's legal obligations to the relevant pension schemes. These claims will continue to be vigorously contested."

up 14% today @ 313 mid with several million shares changing hands ahead of the EGM



ains