The information contained within this announcement is deemed by the Company to constitute inside information under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement via a Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain
Tanfield Group Plc
("Tanfield", or "the Company")
Interim Results for the six-month period to 30 June 2023
Tanfield, an investing company as defined by AIM Rules, announces its half year results for the period ending 30 June 2023. The unaudited financial information will shortly be available on the Company website at www.tanfieldgroup.com.
Background
· Tanfield is a 49% shareholder in the equity of Snorkel International Holdings LLC ("Snorkel") following the joint venture between the Company and Xtreme Manufacturing LLC ("Xtreme") (the "Contemplated Transaction"), a company owned by Don Ahern of Ahern Rentals Inc, relating to Snorkel, in October 2013.
· The Snorkel investment is valued at £19.1m. The outcome of the US Proceedings referenced below could have an impact on this valuation.
· On 22 October 2019, the Company announced that it had received a Summons and Complaint, filed in Nevada (the "US Proceedings") by subsidiaries of Xtreme, relating to the Contemplated Transaction.
· On 24 October 2019, the Company announced it had become necessary to issue and serve a claim in the English High Court (the "UK Proceedings") against its former solicitors acting for the Company at the time of the Contemplated Transaction. On 18 October 2022, the Company announced that it had settled its claims in relation to the UK Proceedings on a no-fault basis.
· The Company's loss in H1 2023 reduced to £154k (H1 2022: £499k) primarily as a consequence of a reduction in legal expenditure following the settlement of the UK Proceedings, and the elimination of finance expenses following the repayment of borrowings, in late 2022.
Overview of investments
As announced on 18 May 2023, in the first quarter of 2023 Snorkel's sales increased by 4.4% to US$43.5m (Q1 2022: US$41.7m). Whilst the increase in sales was a fairly modest US$1.8m in value, the EBITDA for the first quarter of 2023 improved to a US$0.2m profit (Q1 2022: US$3.5m loss), an improvement of some US$3.7m. Further information relating to the recent performance of Snorkel can be found in the 18 May 2023 announcement.
The Company is now focussed on the US Proceedings which are continuing, with a jury trial currently scheduled to take place in early 2024. However, the Board expect the trial date will be rescheduled to around the summer of 2024. The Board continue to believe that a positive outcome to those proceedings is possible. So far as it is necessary, the Company will continue to vigorously defend its position whilst continuing to seek advice.
Further updates will be provided to Shareholders as and when appropriate.
For further information:
Tanfield Group Plc 020 7220 1666
Daryn Robinson
WH Ireland Limited - Nominated Advisor / Broker
James Joyce / Andrew de Andrade 020 7220 1666
| STATEMENT OF COMPREHENSIVE INCOME | |||||||||||||||
| FOR THE SIX MONTHS ENDING 30 JUNE 2023 | | | |||||||||||||
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| | Six months to 30 Jun 23 (unaudited) | Six months to 30 Jun 22 (unaudited) | Year to 31 Dec 22 (audited) |
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| | | £000's | £000's | £000's |
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| Revenue | | | - | - | - |
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| Staff costs | | | (77) | (52) | (242) |
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| Other operating income | | | 11 | 10 | 6,900 |
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| Other operating expenses | | | (140) | (269) | (1,163) |
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| (Loss)/profit from operations | | | (206) | (311) | 5,495 |
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| Finance expense | | | - | (188) | (565) |
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| Finance income |
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| 52 | - | 16 |
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| (Loss)/profit before tax | | | (154) | (499) | 4,946 |
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| Taxation | | | - | - | - |
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| (Loss)/profit & total comprehensive income for the period attributable to equity shareholders | (154) | (499) | 4,946 |
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| (Loss)/profit per share | |
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| Basic and diluted (p) | | | (0.09) | (0.31) | 3.04 |
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| BALANCE SHEET | |||||||||||
| AS AT 30 JUNE 2023 | | | |||||||||
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| 30 Jun 23 (unaudited) | 30 Jun 22 (unaudited) | 31 Dec 22 (audited) |
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| £000's | £000's | £000's |
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| Non current assets | | | | | |
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| Non current Investments | | | 19,100 | 19,100 | 19,100 |
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| | | | 19,100 | 19,100 | 19,100 |
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| Current assets | | | | | |
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| Trade and other receivables | | | 53 | 67 | 30 |
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| Cash and cash equivalents | | | 3,652 | 1,368 | 3,824 |
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| | | | 3,705 | 1,435 | 3,854 |
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| Total assets | |
| 22,805 | 20,535 | 22,954 |
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| Non-current liabilities | | | | | |
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| Borrowings | | | - | 2,958 | - |
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| | | | - | 2,958 | - |
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| Current liabilities | | | | | |
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| Trade and other payables | | | 69 | 132 | 64 |
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| | | 69 | 132 | 64 |
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| Total liabilities |
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| 69 | 3,090 | 64 |
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| Equity | | | | | |
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| Share capital | | | 8,145 | 8,145 | 8,145 |
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| Share premium | | | 17,336 | 17,336 | 17,336 |
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| Special reserve | | | 66,837 | 66,837 | 66,837 |
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| Merger reserve | | | 1,534 | 1,534 | 1,534 |
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| Retained earnings | | | (71,116) | (76,407) | (70,962) |
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| Total equity | |
| 22,736 | 17,445 | 22,890 |
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| Total equity and total liabilities | |
| 22,805 | 20,535 | 22,954 |
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| STATEMENT OF CHANGES IN EQUITY |
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| CASH FLOW STATEMENT | |||||||
| FOR THE SIX MONTHS ENDING 30 JUNE 2023 | | | |||||
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| Six months to 30 Jun 23 (unaudited) | Six months to 30 Jun 22 (unaudited) | Year to 31 Dec 22 (audited) |
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| £000's | £000's | £000's |
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| (Loss)/profit before tax | | (154) | (499) | 4,946 |
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| Adjustment for: |
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| Finance expense | | - | 188 | 565 |
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| Finance income | | (52) | - | (16) |
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| Changes in operating assets and liabilities / working capital: | | | | |
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| (Increase)/decrease in receivables | | (23) | (44) | (7) |
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| Increase/(decrease) in payables | | 5 | 60 | (8) |
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| Cash (used in)/generated by operations |
| (224) | (295) | 5,480 |
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| Interest paid |
| - | - | (810) |
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| Net cash (used in)/generated by operating activities |
| (224) | (295) | 4,670 |
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| Cash flow from Investing Activities | | | | |
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| Interest received | | 52 | - | 16 |
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| Net used in investing activities |
| 52 | - | 16 |
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| Cash flow from financing activities | | | | |
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| Proceeds from borrowings | | - | 1,075 | 1,375 |
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| Repayment of borrowings | | - | - | (2,825) |
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| Net cash (used in)/generated by financing activities |
| - | 1,075 | (1,450) |
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| Net increase in cash and cash equivalents |
| (172) | 780 | 3,236 |
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| Cash and cash equivalents at the start of period | | 3,824 | 588 | 588 |
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| Cash and cash equivalents at the end of the period |
| 3,652 | 1,368 | 3,824 |
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| 1 Basis of preparation The Interim Report of the Company for the six months ended 30 June 2023 has been prepared in accordance with AIM Rule 18 and not in accordance with IAS34 "Interim Financial Reporting" therefore is not fully in compliance with IFRS.
The half year report does not constitute financial statements as defined in Section 434 of the Companies Act 2006 and does not include all of the information and disclosures required for full annual statements. It should be read in conjunction with the annual report and financial statements for the year ended 31 December 2022 which is available on request from the Company's registered office, c/o Weightmans LLP, 1 St James' Gate, Newcastle upon Tyne, NE99 1YQ or can be downloaded from the corporate website www.tanfieldgroup.com.
2 Accounting Policies Impact of accounting standards to be applied in future periods There are a number of standards and interpretations which have been issued by the International Accounting Standards Board that are effective for periods beginning subsequent to 31 December 2023 that the Group has decided not to adopt early. The Group does not believe these standards and interpretations will have a material impact on the financial statements once adopted.
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| 3 Loss per share |
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| The calculation of the basic and diluted loss per share is based on the following data: |
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| | Six months | Six months | Year to |
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| | to 30 Jun 23 | to 30 Jun 22 | 31 Dec 22 |
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| Number of shares | | 000's | 000's | 000's |
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| Weighted average number of ordinary shares for the purposes of basic earnings per share |
| 162,907 | 162,907 | 162,907 |
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| Loss From operations | | £000's | £000's | £000's |
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| Loss for the purposes of basic earnings per share being net profit attributable to owners of the parent | | (154) | (499) | 4,946 | ||||||||||
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| Loss per share from operations |
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| Basic and diluted (p) |
| (0.09) | (0.31) | (3.04) |
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