Stockcube PLC
LSE : SKC

March 31, 2010 02:00 ET

Stockcube preliminary results for 2009

                                            Stockcube Plc
                       Preliminary Results for the year ended 31 December 2009

HIGHLIGHTS
                                                                          2009                2008
                                                                         ?'000               ?'000
                                                                                                  
 Turnover                                                                2,254               2,586
 Profit before tax                                                          22                 192
 Profit after tax                                                           75                  82
 Earnings - pence per share - basic                                      0.78p               0.86p
 Normalised Earnings - pence per share - basic                           0.89p               1.86p
 Earnings - pence per share - diluted                                    0.78p               0.86p


Group turnover 12.8% down on 2008

Profit before tax down to ?22,000 from ?192,000

Normalised earnings per share in 2009 (before share options charge of ?62,000 and R&D tax credits  of
?51,000)  down to 0.89p from 1.86p in 2008 (before share options charge of ?41,000 and  deferred  tax
charge of ?55,000)

Balance sheet with net assets of 27.3p per share, with 26.6p per share in cash and marketable bonds

No dividend will be proposed for the year (2008: 0.75p per share)

Julian Burney, Chief Executive Officer, said:

"As was stated in our interim statement for 2009 we did not foresee an immediate increase in stock
market activity and the trading outlook for the year ended 31 December 2009 was uncertain.

Stockcube's costs are largely fixed so that the group's operating profitability is highly sensitive
to variations in our turnover. Turnover for 2009 was 12.8% below that achieved in 2008 and, although
the Company remained profitable, the reduction in turnover was directly reflected in a drop of 52% in
earnings per share on a like for like basis from 2008.

We believe that confidence and market activity will take some years to return to pre-2008 levels.

With this background in mind, the board of Stockcube has been actively reviewing how to balance
shareholders' interests with the need to maximise cashflows and remunerate staff competitively. The
Board has concluded that continuing to have the Company's shares admitted to trading on AIM is no
longer appropriate and that the interests of non-management shareholders and their associates would
be better served by a tender offer to buy back and cancel their holdings. Proposals to this effect
are being made to shareholders today."

For further information:

Stockcube plc                     Julian Burney                      020-7352-4001
                                  Shirley Yeoh
                                                                     
Astaire Securities plc            William Vandyk                     020-7448-4400

Chairman's Statement
Introduction

The well-publicised economic shocks of the previous two years are still being absorbed and 2009 saw a
continuation of investor reluctance or inability to invest. We expect that the downturn in investment
activity, particularly by institutional investors, will take some years to return to pre-2008 levels.

Overheads continued to be closely monitored during the year.

Financial review

Turnover  showed  a  net  decrease of 12.8% from ?2.586m in 2008 to ?2.254m for  the  year  ended  31
December  2009.  Profit  before tax was ?22,000, a decrease of 89% from 2008  (?192,000).  Normalised
profit  after tax for 2009 was ?86,000, after adjusting for the apportioned employee benefits arising
from  the  grant of share options during the year and R&D tax credits, a decrease of 52%  from  2008.
There  was a profit per share of 0.78p compared to a profit of 0.86p per share in 2008. The like  for
like decrease in normalised EPS between 2009 and 2008 was 52% from 1.86p to 0.89p.

Business review

Stockcube  Research, our institutional consultancy service, suffered a 31% drop in revenues  compared
to  2008 directly reflecting the impact of the economic downturn in global markets and the sharp drop
in  stock  turnover. The impact of lost turnover in our institutional business outweighed  the  gains
made elsewhere in the group.
Our Fullermoney service recorded a 14% decrease in income.
More positively, Investors Intelligence showed a 7% increase in revenues due to increases in the
provision of business to business data and analysis services and Chartcraft recorded a 12% increase
in revenues in US dollar terms over 2008 and a similar increase in pounds sterling.
Ecube, our in-house software business, which develops and supports the group's technology needs,
recorded an increase of 42% in revenues from third parties in 2009 as new customers were gained in
the financial services sector and as existing customers commissioned further systems work.
Our  Treasury  activities were stepped up during the year to generate return  of  4.6%  on  cash  and
available-for-sale investments.

Key performance indicators

The Board measure the Group's performance, principally using the following financial indicators:

                                                             2009          2008                
                                                            ?'000         ?'000    % (decrease)
                                                                                               
Normalised operating (loss)/profit                           (34)           115          (130%)
                                                                                               
Normalised profit before tax                                   84           233           (64%)
                                                                                               
Normalised earnings per share                               0.89p         1.86p           (52%)
                                                                                               
Dividend  (proposed and paid)                                   -         0.75p               -
                                                                                  

Normalised profit before  tax of ?84,000 for 2009 is profit before the share option charge of ?62,000
and for 2008 is profit before the share options charge of ?41,000 .

Staff

I should like to thank all our staff for their contributions during the year.

Dividend

In  view  of  the results for 2009, the company will not be proposing a final dividend for  the  year
(2008: 0.75p).

Proposals for a reduction of capital, tender offer by Astaire Securities Plc, purchase of own  shares
and "de-listing" from AIM.

The  Directors have concluded that for the reasons outlined below, admission of the Company's  shares
to  trading on AIM (the "Listing") does not fulfil the Company's aim of conferring liquidity  to  the
Company's  shares or providing a means of expanding the Company's activities:

*       since the Listing, the directors have been seeking acquisitions which would have synergy with
        Stockcube's  businesses, would enhance shareholder value and would be available at  what  the
        directors  consider  appropriate  values.   The  directors  have  now  concluded  that   such
        acquisitions are very unlikely to be achieved;
        
*       the  directors  have also concluded that the niche nature of the Company's methodologies  and
        services  regarding investment analysis and the method of their distribution are more  suited
        to organic growth rather than growth by acquisition;
        
*       this  means  that a key justification for the Listing, to provide a currency  for  growth  by
        acquisition,  is no longer considered applicable by the directors and is aggravated  by  poor
        levels of share liquidity;
        
*       the  market capitalisation of the Company is considerably below the level when it floated  in
        May  2000  and its shares have traded in the last three months at a discount to net  tangible
        assets and to cash and investment holdings of between 40% and 51%;
        
*       the  Company's  shares suffer from a lack of liquidity and in practical  terms  a  relatively
        small  free float, which the board believes reduces demand. Trades in small volumes of shares
        tend to have a disproportionate effect on the share price and hence market capitalisation  of
        the Company;
        
*       low  liquidity  is  coupled  with high costs associated with  the  Listing  relative  to  the
        Company's market capitalisation (approximately ?143,000 per year); and
        
*       recent  and  current  uncertainty within the investment community has led  to  a  significant
        reduction  in the Group's income particularly from institutional customers and the  directors
        believe  that  this  necessitates a reorganisation of the Group's  products  and  operational
        structure to remove surplus costs so that its cost base is more in line with the lower growth
        environment the directors see for the investment industry.
        
In  the  light  of  a number of these factors, the Company repaid ?2,402,657.50 of surplus  cash  (in
aggregate) to shareholders in 2007 and 2008.

The directors have formed the view that for the foreseeable future any benefits to the Company of the
Listing  are  outweighed by the cost and resources required (i) to manage the  Group  in  the  public
arena;  and  (ii)  for an entity of its current size, to comply with increasingly  complex  financial
reporting requirements.

Accordingly,  the  directors  now firmly believe that the Company should  seek  cancellation  of  the
admission  of  the  its  shares to trading on AIM.  It is anticipated that,  subject  to  shareholder
approval and other conditions being met, the Company's ordinary shares will be cancelled from trading
on AIM.

In  addition,  the  directors have decided that they do not intend to provide, seek  or  support  any
arrangements whereby the Company's shares can be bought and sold on a market or on a  matched bargain
basis.   As  such,  the directors believe that the Company's shares will be unlikely  to  be  readily
capable  of sale and where a buyer is identified, it will be difficult to place a fair value  on  any
such sale.


The  directors recognise that many shareholders will not be able or willing to continue to own shares
in the Company following the proposed de-Listing, particularly in view of the directors' intention of
increasing the emphasis on staff incentivisation by results-driven remuneration, coupled with  a  nil
dividend  policy for the foreseeable future.  Accordingly, the board has arranged for the Company  to
apply to Court to reduce its share premium account, for Astaire Securities Plc to make a tender offer
to  shareholders  to  buy their shares for cash and for such shares to then be  bought  back  by  the
Company  and cancelled (all subject to court approval and the approval of shareholders at  a  general
meeting  of  the Company). Holders of shares totaling 57.6% of the issued shares have confirmed  that
they  do  not  wish  to  participate in the tender offer which will be made to  the  holders  of  the
remaining 42.4% of issued shares. A circular setting out the above proposals is being issued  by  the
Company today.

Edward Forbes,
Chairman,
London
30 March 2010



Consolidated Income Statement
for the year ended 31 December 2009

                                                                                       2009        2008
                                                                                       ?000        ?000
Continuing Operations                                                                                  
Revenue                                                                               2,254       2,586
Cost of sales                                                                         (287)       (328)
                                                                                    -------     -------
Gross Profit                                                                          1,967            
                                                                                                  2,258
Administrative expenses                                                             (2,063)     (2,184)
                                                                                    -------     -------
Operating(loss)/ profit                                                                (96)          74
Finance income                                                                          118         118
                                                                                    -------     -------
Profit before taxation                                                                   22         192
Taxation                                                                                 53       (110)
                                                                                    -------     -------
Profit for the year attributable to equity holders of the parent                         75          82
                                                                                    -------     -------
                                                                                                       
Basic earnings per share                                                              0.78p       0.86p
                                                                                                       
Diluted earnings per share                                                            0.78p       0.86p

Consolidated Statement of Financial Position
At 31 December 2009

Company Number 3838579

                                                                                 2009              2008
                                                                                 ?000              ?000
Non current assets                                                                                     
Intangible assets                                                                  17                17
Available for sale investments                                                  1,059               700
Property, plant and equipment                                                     300               329
                                                                              -------           -------
                                                                                1,376             1,046
                                                                              -------           -------
Current assets                                                                                         
Trade and other receivables                                                       338               229
Available for sale investments                                                    727               515
Cash and cash equivalents                                                         774             1,413
                                                                              -------           -------
Total current assets                                                            1,839             2,157
                                                                              -------           -------
Current liabilities                                                                                    
Trade and other payables                                                        (588)             (603)
Current tax payable                                                                 -              (60)
                                                                              -------           -------
Total current liabilities                                                                                                                                 (588)             (663)
                                                                              -------           -------
Net current assets                                                              1,251             1,494
                                                                              -------           -------
Net assets                                                                      2,627             2,540
                                                                              -------           -------
                                                                                                       
Equity                                                                                                 
Share capital                                                                     961               961
Share premium account                                                           1,294             1,294
Merger reserve                                                                    568               568
Share options reserve                                                             103                41
Available for sale investments reserve                                             11                 9
Translation reserve                                                                 -              (20)
Retained earnings                                                               (310)             (313)
                                                                              -------           -------
Total equity                                                                    2,627             2,540
                                                                              -------           -------





Consolidated Statement of Cash Flows

for the year ended 31 December 2009
                                                                                2009               2008
                                                                                ?000               ?000
Net cash(outflow)/ inflow from operating activities                            (105)                526
                                                                             --------          --------
Cash flows from investing activities                                                                   
                                                                                                       
Interest and other income received                                               118                118
Sales of available-for-sale investments                                        1,601                668
Purchases of property, plant and equipment                                       (9)               (10)
Purchase of available-for-sale investments                                   (2,172)            (1,874)
                                                                            --------           --------
Net cash used in investing activities                                          (462)            (1,098)
                                                                            --------           --------
Cash flows from financing activities                                                                   
Capital reorganisation - cash repaid to shareholders and                                       
associated expenses                                                                -              (203)
Equity dividends paid                                                           (72)              (120)
                                                                            --------           --------
Net cash used in financing activities                                           (72)              (323)
                                                                            --------           --------
Net decrease in cash and cash equivalents                                      (639)              (895)
                                                                                                       
Cash and cash equivalents at beginning of year                                 1,413              2,308
                                                                            --------           --------
Cash and cash equivalents at end of year                                         774              1,413
                                                                            --------           --------

Notes

1.    Nature of financial information
This financial statements does not constitute financial statements under Section 434 of the Companies
Act 2006. The results of the year ended 31 December 2008 are extracts from the Group financial
statements which have been delivered to the Registrar of Companies. They carry an unqualified
auditor's report and did not contain a statement under Section 495 of the Companies Act 2006and did
not include references to any matters to which the auditor drew attention by way of emphasis. The
statutory accounts for the year ended 31 December 2009 have not yet been delivered to the Registrar
of Companies nor have the auditors reported on them. They will be finalised on the basis of the
information presented by the Directors in this preliminary announcement.

2.    Accounting policies
The principal accounting policies are summarised below.  They have all been applied consistently
throughout the period covered by these financial statements.
Basis of preparation
The financial information has been prepared in accordance with International Financial Reporting
Standards ("IFRS"), as adopted by the EU.
The financial statements have been prepared on a historical cost basis, except for available for sale
assets which are measured at fair value.
Basis of consolidation
The group financial statements incorporate the financial statements of Stockcube PLC and all of its
subsidiary undertakings for the year to 31 December 2009.
All subsidiaries are controlled by Stockcube Plc. Control is achieved where the Company has the power
to govern the financial and operating policies of than investing entity so as to obtain benefits from
its activities.
Intra-group balances and any unrealised gains and losses or income and expenses arising from intra-
group transactions are eliminated in preparing the consolidated financial statements.

3.    Revenue
    Revenue, which is stated net of value added tax, represents the sales value of work done in the
    year.
    Revenue is attributable mainly to the continuing activity of the provision of research and
    analysis of price trends in stocks, commodities, currencies and interest rates.

4.    Operating segments

Segmental information is presented in the consolidated financial statements based on how information
is reported to the Chief Operating Decision Maker. The Group derives its revenues from three separate
streams and these have formed the basis of the reportable segments.

All inter-segment sales are transacted at arms-length basis. The results of each segment have been
prepared using accounting policies consistent with the Group as a whole.
                Consultancy     Subscriptions    Technology     Total  Consultancy   Subscriptions   Technology     Total
                        31Dec          31Dec         31Dec    31 Dec        31Dec           31Dec        31Dec    31 Dec
                         2009           2009          2009      2009         2008            2008         2008      2008
                         ?000           ?000          ?000     ?'000         ?000            ?000         ?000      ?000
External                  894          1,153           207     2,254        1,303           1,137          146     2,586
Revenue
Inter-segment               -              -           179       179            -               -          273       273
sales                       -              -                                    -               -                       
Eliminations                                         (179)     (179)                                     (273)     (273)
Total Revenue             894          1,153           207     2,254        1,303           1,137          146     2,586
Segment                    20             96          (12)       104          175             121         (40)       256
Results
Unallocated                                                                                                             
Expenses                                                       (200)                                               (182)
Group                                                                                                                   
Operating                                                                                                               
(Loss)/profit                                                   (96)                                                  74
Net Financing                                                                                                           
income                                                           118                                                 118
Profit before                                                     22                                                 192
tax
Income                                                                                                                  
tax(repayment)                                                                                                          
/ Expense                                                         53                                               (110)
Profit for the                                                                                                          
year                                                              75                                                  82
                                                                                                                        

                Consultancy     Subscriptions    Technology     Total  Consultancy   Subscriptions   Technology     Total
                        31Dec                        31Dec    31 Dec        31Dec           31Dec        31Dec    31 Dec
                         2009          31Dec          2009      2009         2008            2008         2008      2008
                                        2009
                         ?000           ?000          ?000     ?'000         ?000            ?000         ?000      ?000
Segment Assets         1,275           1,645           295    3,215         1,614           1,408         180     3,203
                                                                                                                       
Segment                (233)           (301)          (54)    (588)         (334)          (291)          (37)    (663)
Liabilities
Net assets              1,042          1,344          241      2,627        1,280          1,117           143    2,540

Group assets and liabilities have been allocated to segments based on turnover.

The Group's operations are in two geographical segments, the United Kingdom and United States.

                                       UK           US                        UK         US       
                                     2009         2009         Total        2008       2008    Total
                                     ?000         ?000          ?000        ?000       ?000     ?000
External turnover                   1,765          489         2,254       2,237        349    2,586
                                   ------       ------        ------      ------     ------    ------

No customer accounts for more than 10% of group revenue.

All non-current assets are located in the UK.


5.     Earnings per share

                                                                                  2009          2008
Earnings                                                                          ?000          ?000
Earnings for the purposes of basic and diluted earnings per share being                             
net profit attributable to equity shareholders                                      75            82
                                                                              --------      --------
Number of shares                                                                  '000          '000
Weighted average number of ordinary shares for the purposes of basic                                
earnings per  share                                                              9,611         9,611
                                                                              --------      --------

Profit per ordinary share (pence):
Basic                                                                           0.78p           0.86p
Normalised basic                                                                0.89p           1.86p
Diluted                                                                         0.78p           0.86p
Normalised diluted                                                              0.89p           1.86p

Normalised  earnings  per  share is calculated by adding back the share  option  benefits  charge  of
?62,000  and adjusted R&D tax credits of ?51,000 (2008: share options benefits charge of ?41,000  and
deferred tax charge of ?55,000), to give an adjusted earnings after tax of ?86,000 (2008: ?178,000).

Diluted earnings per share are calculated by adjusting the weighted average number of ordinary shares
outstanding to assume conversion of all dilutive potential ordinary shares.  A calculation is done to
determine the number of shares that could have been acquired at fair value (determined as the average
annual  market  share price of the company's shares) based on the monetary value of the  subscription
rights  attached to outstanding share options. The number of shares calculated as above  is  compared
with  the  number of shares that would have been issued assuming the exercise of the  share  options.
Based  on these calculations there were no dilutive potential ordinary shares in 2009 (2008: nil)  as
the  market  price  is less than the grant price of the options. 1,564,647 options  were  potentially
dilutive at 31 December 2009.

6 .  Cash (used in)/generated from operations
Group                                                                            2009            2008
                                                                                 ?000            ?000
Operating (loss)/profit                                                          (96)              74
Depreciation                                                                       38              20
Exchange differences                                                               20            (27)
Share options charge                                                               62              41
Available for sale investments revaluations                                         2               -
(Increase)/decrease in trade receivables                                        (109)             562
Increase/(decrease) in trade payables                                              25            (95)
                                                                             --------        --------
Cash (used in) generated from operations                                         (58)             575
Tax paid                                                                         (47)            (49)
                                                                             --------        --------
Net cash (outflow)/inflow from operating activities                             (105)             526
                                                                             --------        --------

Company                                                                          2009            2008
                                                                                 ?000            ?000
Operating loss                                                                  (475)           (181)
Provision for amounts due from group undertaking                                  275               -
Share options charge                                                               62              41
Available for sale investments revaluations                                         2               -
Decrease in trade and other receivables                                             7             198
Increase in trade and other payables                                               25             354
                                                                             --------        --------
Net cash (outflow)/inflow from operating activities                             (104)             412
                                                                             --------        --------

7. Post Balance Sheet Event
Recent and current uncertainty within the investment community has led to a significant reduction in
the Group's income, particularly from institutional customers.
The Directors now firmly believe that the Company should seek cancellation of the admission of the
Ordinary Shares to trading on AIM.
The proposal to Shareholders to delist the Company's shares to trading on AIM will constitute a post
balance sheet event.

8. Annual report and accounts
The annual report and accounts will be posted to shareholders on 31 March 2010 and copies will be
available free of charge during normal business hours on any day (except Saturdays, Sundays and
public holidays) at the offices of the Company at Unit 1.23 Plaza 535, King's Road, London SW10 0SZ.

                                                  

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