Hardide plc
AIM : HDD

Hardide plc

June 28, 2005 02:04 ET

Hardide plc-Interim Results for the Period to 4 April 2005

LONDON, UNITED KINGDOM--(CCNMatthews - June 28, 2005) - Hardide plc ("Hardide" or "the Company")(AIM:HDD), the provider of unique surface engineering technology, announces its maiden set of interim results. The interim results cover the trading of Hardide plc from its formation on 27 January 2005 to completion of the AIM admission and fundraising on 4 April 2005. The pro forma results cover the trading of the operating subsidiary Hardide Coatings Limited for the six months to 31 March 2005, which was acquired by Hardide plc on 7 March 2005.

Financial highlights

- Turnover Pounds Sterling 496,134 (H1 2004 Pounds Sterling 124,633)

- Operating Loss reduced to Pounds Sterling 281,222 (H1 2004 Pounds Sterling 519,204)

- Loss before Tax reduced to Pounds Sterling 273,364 (H1 2004 Pounds Sterling 531,204)

- Successful listing on AIM in April 2004 raising net proceeds of Pounds Sterling 1.4 million

- Supplier status attained with BAE Systems

- Appointment of Financial Controller

Commenting on the results, Jim Murray-Smith, Chief Executive of Hardide plc, said:

"I am delighted to report the maiden set of interim results for Hardide. Our successful flotation on AIM which raised Pounds Sterling 1.4 million will help Hardide achieve its strategic goals. We are particularly encouraged by the number of new customers who are adopting Hardide as a solution provider. Our approved supplier status with BAE Systems is another excellent endorsement of our product. I am confident that our good performance outlined in these results will continue in the months ahead."



For further information:
Hardide plc

Jim Murray Smith, Chief Executive Tel: +44 (0) 1869 353 830
jmurray-smith@hardide.com www.hardide.com

Seymour Pierce

Sarah Wharry / Jeremy Porter,
Corporate Finance Tel: +44 (0) 20 7107 8000

Media enquiries:
Abchurch

Peter Curtain / Chris Lane Tel: +44 (0) 20 7398 7700
chris.lane@abchurch-group.com www.abchurch-group.com


Chairman's Statement

The six months to 31 March 2005 have been an exceptionally busy period in the Company's short history.

Your Board took the decision in December 2004 to list the Company on AIM to raise its profile and to raise funds to accelerate expansion. The Company appointed advisers early in the New Year and was admitted to trading on AIM on 4 April 2005, having raised Pounds Sterling 1.75 million, before costs. The funds raised will enable Hardide to reach the next stage in its development, expand into other geographical markets and consolidate on the Company's success to date.

I must pay a special vote of thanks to your executive directors, Jim Murray-Smith and Yuri Zhuk for their hard work. Jim's drive and enthusiasm ensured a successful fundraising and float without the Company's trade performance suffering.

The Board is confident of the Company's trading for the remainder of the financial year as the customer base expands.

David Chestnutt

Chairman


Chief Executive's Report

I am pleased to have this opportunity to comment on Hardide's first set of interim accounts since its admission to AIM on 4 April this year. You will note that the Interim Report reflects the position of the listed Plc Company, which of course acquired the business of Hardide Ltd (now Hardide Coatings Ltd) immediately prior to the flotation, and therefore, the Plc accounts as filed allow no opportunity for comparison with previous trading periods. In order for our progress to be clearly seen I have had added a Pro Forma Profit and Loss Account relevant to the operational business for the past three six-month periods.

Consequently I am able to report solid progress both in the continued development of our customer base across our chosen fields of operation and also success in consolidating our position as a reliable and worthy supplier to what are now becoming our established customers. This progression is clearly demonstrated by steady increases in turnover over the past three six-month periods.

The successful fundraising in April, which was oversubscribed, means we are well positioned to maintain our combined strategy of growing the business by new customer conversion and continuing to improve our customer performance. The funds are being used mainly for investment in new plant, recruitment and marketing to take advantage of opportunities in the energy and general engineering sectors. This investment, coupled with the IPO, will help raise our profile to reposition the Company as a global participant in the surface technology market.

The flotation has enabled the Company to put additional infrastructure in place, including the appointment of a Financial Controller with a proven track record in industry. Peter Davenport was previously a Financial Controller at the UK arm of Valspar Corporation, a NYSE-listed company involved in the manufacture of coatings.

Recent additions to our Sales, Accounting and Production teams, together with further investment in state-of-the-art measurement and pre-treatment equipment, underscore your management's commitment to driving the business forward in an efficient and professional manner. We are much encouraged by the number of new customers evaluating and adopting Hardide as a solution provider and by the position these organisations fill in their respective markets.

Our intention, announced on 25 April, to establish a sales and manufacturing facility in Houston, Texas, was well received by our customers both in the US and elsewhere. The investment will address the growing demand for Hardide's products in the oil and gas sector. The official opening of the Houston sales office took place on 27 June. To reinforce supply to UK and European customers and to meet the increasing demand for our products, we have also commissioned a new pre-treatment plant at Bicester.

Supply relationships with our key customers are advancing and I am delighted to report that Hardide has recently received approval to act as a supplier to BAE Systems.

Interest shown in the Company among potential customers and business partners during and since the Offshore Technology Conference in Houston, USA, in May 2005, has been most encouraging, and we look forward to extending our customer base through these potential opportunities.

We are confident that our positive performance will continue in the months ahead.

Jim Murray-Smith

Chief Executive



HARDIDE COATINGS LIMITED (FORMERLY HARDIDE LIMITED)
---------------------------------------------------------------------

PROFORMA PROFIT AND LOSS ACCOUNT
SIX MONTHS ENDED 31 MARCH 2005

Six months Six months Six months
ended 31 ended 30 ended 31
March 2005 September 2004 March 2004
(unaudited) (unaudited) (unaudited)
Pounds Pounds Pounds
Sterling Sterling Sterling
'000 '000 '000

Turnover 496,134 206,368 124,633

Cost of Sales (204,781) (163,984) (130,016)
--------------------------------------------

Gross Profit 291,353 42,384 (5,384)

Administrative Expenses (618,553) (554,680) (540,320)

Other Income 45,978 26,500 26,500
--------------------------------------------

Operating Loss (281,222) (485,797) (519,204)

Interest receivable 9,952 8,000 -

Interest payable and
similar charges (2,094) (6,668) (12,000)
--------------------------------------------

Loss on ordinary
activities before
taxation (273,364) (484,465) (531,204)


GROUP PROFIT AND LOSS ACCOUNT
FOR THE PERIOD FROM 27 JANUARY 2005 TO 4 APRIL 2005

27 January 2005
to 4 April 2005
(unaudited)
Pounds Sterling
Notes '000

Turnover 100
Cost of sales 30
---------------

Gross profit 70
Administrative expenses (158)
---------------

Operating loss (88)

Profit on disposal of operations -
Income from other fixed assets investments -
Other income 23
---------------

Loss on ordinary activities before
investment income, interest and taxation (65)
Other interest receivable 4
Interest payable and similar charges -
---------------

Loss on ordinary activities before taxation (61)
Taxation on loss on ordinary activities -
---------------

Loss on ordinary activities after taxation (61)
Minority interest: equity -
Dividends received -
---------------

Loss for the financial year attributable
to members of the parent company (61)
---------------
---------------

Loss per share: basic and diluted
(pence per share) 2 (0.05)
---------------
---------------

There are no recognised gains or losses other than the loss for
the period.


GROUP BALANCE SHEET
FOR THE PERIOD FROM 27 JANUARY 2005 TO 4 APRIL 2005

Unaudited
4 April
2005
Pounds Sterling
Notes '000

Fixed assets
Intangible assets 9,772
Tangible assets 1,032
---------------

10,804

Current assets
Stock 35
Debtors 4 390
Cash at bank and in hand 1,909
---------------

2,334

Creditors: amounts falling due within one year (578)
---------------

Net current assets 1,756
---------------

Creditors: amounts falling due after one year (73)
---------------

Net assets 12,487
---------------
---------------

Capital and reserves
Called up share capital 1,275
Share premium reserve 11,273
Profit and loss account (61)
---------------

Total shareholders' funds 5 12,487
---------------
---------------

The interim financial report was approved by the board of directors
on 27 June 2005 and was signed on their behalf by:


J S Murray-Smith
Director


GROUP CASH FLOW STATEMENT
AT 4 APRIL 2005


27 January 2005
to 4 April 2005
(unaudited)
Pounds Sterling
Notes '000

Cash outflow from operating activities 6 (47)
---------------

Returns on investment and servicing
of finance
Interest element of finance lease
rental payments -
Interest received -
Dividends received -
---------------
-
---------------

Taxation
Taxation paid -
---------------

Capital expenditure and financial investment
Payments to acquire tangible fixed assets (48)
---------------
Payments to acquire intangible fixed assets
---------------

(48)
---------------

Acquisitions and disposals
Net cash transferred with subsidiary
undertakings 454
---------------
-
---------------

Net cash inflow before financing (359)
---------------

Financing
Issue of shares 1,550
---------------

1,550
---------------

Increase in cash 1,909
---------------
---------------


NOTES TO THE INTERIM REPORT
FOR THE PERIOD ENDED 4 APRIL 2005


1. ACCOUNTING POLICIES

(i) Basis of preparation

The interim report for the period ended 4 April 2005 is unaudited and does not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985. It has been prepared under the historical cost convention and on a basis consistent with the accounting policies used to prepare audited accounts of the company's wholly owned subsidiary Hardide Coatings Limited for the year ended 30 September 2005.

(ii) Basis of consolidation

The group financial statements consolidate the financial information of the company and of its subsidiaries. The financial information for each company in the group has been prepared to 4 April 2005.

2. EARNINGS PER SHARE

The calculation of basic and diluted loss per share is based on loss of Pounds Sterling 61,000 the period ended 4 April 2005 and on the weighted average number of ordinary shares in the period of 127,493,242.



3. INVESTMENTS

(a) Subsidiary Undertakings

Company No. of Type of Share Nominal Nature of
Shares Shares Capital Value business
Pounds
Sterling

Hardide Coatings
Limited 1,927,706 Ordinary 100% 0.10 Surface
Coating


4. DEBTORS Unaudited
4 April
2005
Pounds Sterling
'000

Trade debtors 265
Other debtors 125
-----------------
390
-----------------


5. RECONCILIATION OF MOVEMENT IN EQUITY
SHAREHOLDERS' FUNDS

Unaudited
4 April
2005
Pounds Sterling
'000
Group

(Loss)/profit for the period (61)
On issue of shares 12,548
On share for share exchange -
-----------------
Increase in shareholders' funds 12,487

Opening shareholders' funds -
-----------------

Closing shareholders' funds 12,487
-----------------
-----------------


6. RECONCILIATION OF OPERATING LOSS TO NET
CASH OUTFLOW FROM OPERATING ACTIVITIES

Unaudited
4 April
2005
Pounds Sterling
'000

Operating loss (20)
Depreciation of tangible fixed assets 17
Increase in operating debtors and prepayments (93)
Increase in stocks (18)
Increase in operating creditors and accruals 67
Amortisation of goodwill -
-----------------

Cash inflow from operating activities 47
-----------------
-----------------


7. COPIES OF THE INTERIM REPORT

Copies of this Interim Report will be posted to shareholders and further copies will be available from the Company's office at Unit 11, Wedgwood Road, Bicester, Oxfordshire OX26 4UL.


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