Foresight 3 VCT PLC : Half-yearly report

FORESIGHT 3 VCT PLC

Summary

• Net asset value per Ordinary Share in the six months to 30 September 2012 increased by 0.4%, represented by a net asset value of 77.8p at 30 September 2012 compared to a net asset value of 77.5p as at 31 March 2012. 

• The Company made one new and nine follow-on investments totalling £1,419,505. 

• Proceeds of £242,722 were received from three investments. 

• In the interim period the top-up offer, launched on 23 December 2011, raised gross proceeds of £844,946. 

Chairman's Statement

Performance

The period under review continued to be one of considerable market volatility and extreme concern about the state of government finances in many parts of Europe. In the UK, economic activity was patchy, leading to a double-dip recession and bank lending to SMEs was severely constrained.

These factors affected portfolio companies in a variety of ways. Some companies that needed to maintain or increase their borrowing to pursue development projects or to expand their activities had difficulty in doing so; others, with more established businesses, were able to find growth opportunities, particularly via exports.

Against this background, I can report that the net asset value of the Ordinary Share portfolio as at 30 September 2012, increased by 0.4% to 77.8p (31 March 2012: 77.5p).

This performance reflects the continued robust performance of the private equity portfolio but also a more stable performance in the environmental portfolio, where those companies with real future potential have been identified and continue to be supported by the Foresight VCTs and those that were struggling to make progress, as detailed in the Annual Report and Accounts, have received no further support and have either been placed into administration or sold for
nominal consideration.

The non-environmental portfolio benefited from the strong performances of five investments in particular: Alaric Systems; Autologic Diagnostics Group; Datapath Group; Meridian Technique and TFC Europe, all of which have seen increases in valuation during the last six months. We expect these companies to drive net asset value (NAV) performance in the coming months, while also seeing the environmental portfolio start to recover value.

Other companies are making progress but at the same time have encountered delays in project implementation and in building their businesses in a very difficult environment. AIM-listed Zoo Digital Group suffered a sharp decline in its share price following disappointing results, but more recently has confirmed that it is trading profitably and is optimistic about the outlook for the remainder of its financial year to 31 March 2013.

During the period, £103,000 was received from Alaric Systems comprising interest (£8,080), redemption premium (£61,320) and repayment of loan principal (£33.600). The Company's entire investment in AIM listed Croma Group's ordinary shares was sold, generating proceeds of £146,955. In addition to the January 2012 sale, a disposal in Autologic Diagnostics Group also took place in which a small number of shares were bought by a new operating partner as part of an executive incentive share scheme, generating £847 of proceeds.

Foresight Group remains positive about the prospects for this portfolio over the medium to longer-term.

Over the last two or so years, weak economic conditions and lack of availability of bank and equity finance have adversely affected the performances of and hindered the planned expansion of the environmental investments. As these poor macro economic conditions are expected to continue for some time, the Board and Investment Manager previously agreed that, within the existing investment policy, greater emphasis should, for the foreseeable future, be placed on
private equity investments, where Foresight Group are seeing an increase in deal flow and less emphasis on environmental infrastructure investments.

Share Issues and Share Buy-backs

The Company launched a top-up offer on 23 December 2011 alongside its enhanced buyback offer to Shareholders. During the period from 1 April 2012 until 30 September 2012, 997,114 Ordinary Shares were allotted at a price of 87.26p raising £0.85 million.

It continues to be the Board's policy to consider repurchasing shares when they become available in order to provide a degree of liquidity for the sellers of the Company's shares. During the period, the Company repurchased 399,994 Ordinary Shares for cancellation at a cost of £279,175.

Enhanced Buyback

I am pleased to report that the take up by shareholders of the enhanced buyback offer to shareholders was significant with shareholders representing 8,753,756 Ordinary Shares taking up the offer during April 2012. The Board will consider offering further enhanced buybacks to shareholders in the future providing that legislation continues to allow the practice and it remains popular with the Company's shareholders.

Valuation Policy

Investments held by the Company have been valued in accordance with the International Private Equity and Venture Capital (IPEVC) valuation guidelines (August 2010) developed by the British Venture Capital Association and other organisations. Through these guidelines, investments are valued as defined at 'fair value'. Ordinarily, unquoted investments will be valued at cost for a limited period following the date of acquisition, being the most suitable approximation of fair value unless there is an impairment or significant accretion in value during the period. Quoted investments and investments traded on AIM and ISDX Growth Market (formerly PLUS) are valued at the bid price as at 30 September 2012. The portfolio valuations are prepared by Foresight Group, reviewed and approved by the Board quarterly and subject to review by the auditors annually.

Outlook

Although the Board remain cautious about the economic outlook in general and Foresight Group is being extremely selective in its approach to proposals received, Foresight Group believes that the current pipeline of private equity investment opportunities is the best it has ever seen both in terms of vendor pricing and the quality of the business propositions and management teams. The Board is launching a top-up offer in the Company's shares to enable it to participate in new investments made.

Over the medium term we are optimistic that further realisations at attractive prices will be achieved from within the existing portfolio and so increase net asset value and facilitate shareholder distributions as well as provide additional funding for new investments.

Graham Ross Russell
Chairman
30 November 2012
Investment Manager's Report

At 77.8p per share, net asset value as at 30 September 2012 changed marginally from that at 31 March 2012, reflecting both positive and negative factors. A number of companies in the portfolio, most notably Alaric Systems, Autologic Diagnostics Group, Datapath Group and TFC Europe continued to perform particularly well during the period (with Alaric Systems and Datapath Group achieving record monthly profits). However, as explained below, it was necessary to make provisions against the investments in other portfolio companies, mainly environmental investments.

Notwithstanding the continuing anaemic and challenging UK economic environment, the majority of companies in the portfolio continued to trade satisfactorily, those exporting outperforming those serving domestic markets. These mixed trading conditions will continue for the foreseeable future and there is still a significant risk of further macro economic weakness, particularly in Europe where demand remains generally poor. We continue to actively manage each portfolio investment to ensure each business is well led and carefully controlled in terms of costs and that its business model is as robust and flexible as possible. Against this background, we are only looking at new opportunities which are considered sufficiently robust and attractive, particularly in terms of
valuation. One new investment was made in the period in a management buy out of Flowrite Refrigeration Holdings, a well established South East based company offering refrigeration and air conditioning maintenance and services to leisure and commercial businesses nationally and the company is already trading well ahead of budget.

Although some of the environmental investments traded well during the period, such as Closed Loop Recycling and Evance Wind Turbines, others were badly affected by the current economic headwinds. Closed Loop Recycling is generating revenues in excess of £1.4 million per month and cannot meet customer demand for its recycled PET and HDPE. Plans are well advanced to double the capacity of the Dagenham plant, which, once commissioned, is forecast to result in substantial profits being generated. The funding for this planned expansion is now in legal stages. Evance Wind Turbines is currently enjoying good sales of its market leading small wind turbines, having recently achieved monthly sales of £1 million and delivered its 1,500th machine.

As a result of delays at O-Gen Acme Trek in progressing alternative plans to either retrofit the Stoke plant or redevelop the site as an 8MW power plant (nearly three times the output of the present plant), it was felt necessary to make a further provision against the cost of this investment. Reflecting much slower than expected growth in sales and continuing losses at Silvigen, the decision was reluctantly made not to provide further funding, resulting in the company going into administration in September. With long, extended customer decision making and lengthy sales cycles, Crumb Rubber experienced similar trading conditions and losses and so the investment was sold for nominal consideration to the management team in November. As a consequence of a marked fall in demand during the Summer from customers in the construction industries for its recycled plastic products and consequent margin pressure, a similar decision was made to no longer support i-plas Group, resulting in an administrator being appointed in October. As previously noted in the Annual Report and Accounts to 31 March 2012, Vertal went into administration on 21 June 2012, reflecting various technical plant issues and much higher than expected disposal costs. Further provisions totalling £2,086,120 were made against these investments, comprising O-Gen Acme Trek (£820,258), i-plas Group (£794,733), Silvigen (£401,372), Crumb Rubber (£35,000), and Vertal (£34,757). Where provisions have been made against the value of investments, we have also provided against the income due from such investments and this is reflected in the negative loan stock interest amount in the Income Statement of the Company.

Portfolio Review

During the six month period to 30 September 2012, the Company made one new investment in Flowrite Refrigeration Holdings (£200,000) and provided follow-on funding totalling £1,219,505 to eight portfolio companies: 2K Manufacturing (£500,000), AtFutsal Group (£196,346), The Message Pad (£190,003),  i-plas Group (£150,000), Ixaris (£96,533), Crumb Rubber (£35,000), Vertal (£34,757), Silvigen (£16,666) and Autologic Diagnostics (£200).

The performance highlights during the period were as follows:

Alaric Systems, which develops and sells credit card authorisation and credit card anti fraud software to major financial institutions and retailers worldwide, performed particularly strongly in the year to 31 March 2012, generating a PBIT of £1.46 million on sales of £8.67 million, markedly ahead of the previous year (PBIT of £540k on sales of £5.54 million). A number of significant orders have been won recently which support achievement of the demanding budget for the current year. Capacity to satisfy these orders is being met through continuing expansion of the offices in Kuala Lumpur and London. In May and September 2012, reflecting strong cash generation, Alaric Systems paid a total of £103,000 to the Company, comprising interest (£8,080), redemption premium (£61,320) and repayment of loan principal (£33,600). The strong performance resulted in an increase in Alaric System's valuation of £1.05 million during the period.

AtFutsal Group provides facilities for futsal, a fast growing type of indoor football with 30 million participants worldwide and the only type of indoor football recognised by the Football Association. Sales have built up steadily in the new, large flagship super arena in Birmingham which is now operating near break even. A further £196,346 was invested in April to finance the opening of a further super arena in Leeds in August, thereby creating national coverage. Sales in Leeds in the initial two months were promising. The small loss making Cardiff arena was closed at minimal cost in June as a result of a change in educational
funding in Wales with effect from September. Good progress is being made in developing the increasingly important educational services with nearly 800 students now taking a variety of sports related courses within AtFutsal Group's arenas and a number of partnerships have been entered into with educational establishments, football clubs and training organisations. Sales growth remains behind expectations with UK consumer spending under pressure, and progress towards profitability has been delayed as a result. The benefits of economies of scale from extended national coverage are anticipated to enhance the important educational activities.

Autologic Diagnostics Group develops and sells sophisticated automotive diagnostic software and hardware to independent mechanics and garages to allow them to service and repair vehicles. In the year ended 31 December 2011 an operating profit of £5.2 million was achieved on sales of £12.2 million. Autologic Diagnostics Group is continuing to grow sales and profits further in its current financial year, particularly in the USA. As referred to in the Annual Report and Accounts to 31 March 2012, part of the investment in Autologic Diagnostics Group was sold in January 2012 in a £48 million secondary management buy-out funded by ISIS Private Equity. The sale generated cash proceeds of £2.79 million, against original cost of £0.6 million and the Company retained an ongoing investment of £1.98 million in a combination of equity and loan stock in the new buy-out company. In addition to this, a disposal in Autologic Diagnostics Group also took place in the period, in which a small number of shares were brought by a new operating partner as part of an executive incentive share scheme generating £847 of proceeds.

Closed Loop Recycling continued to make solid operational, commercial and revenue progress during the period with production rates at record levels and significantly improved plant reliability, generating revenues in excess of £1.4 million per month. The company cannot meet customer demand for its recycled PET and HDPE. Product quality remains high but the company continues to be affected by raw material quality which restricts throughput and yield, but is
making progress in addressing this problem. Plans are well advanced to double the capacity of the Dagenham plant by increasing the plastic sorting facilities and production lines, which, once commissioned, are forecast to result in substantial profits being generated. The £17 million funding for this planned expansion, all from third party funders, is now in legal stages.

During the period, £35,000 was invested in Crumb Rubber to meet its urgent working capital requirements. However, reflecting extended customer decision making, lengthy sales cycles and much slower than expected growth in sales, the company continued to incur losses and the decision was reluctantly made not to provide further funding. The investment was sold for nominal consideration to the other shareholders in November.

Datapath Group is a world leading innovator in the field of computer graphics and video wall display technology. For the year ended 31 March 2012, an operating profit of £4.5 million was achieved on sales of £12.1 million (£3.1 million operating profit on sales of £10.3 million in 2011). The company is continuing its strong growth in the current year to 31 March 2013 with record sales being achieved in October 2012, supporting an increase in the valuation by £1.03 million during the period.

Evance Wind Turbines, which manufactures 5kw tree sized wind turbines, enjoyed strong sales growth, driven primarily by the introduction of the UK Feed in Tariff regime. For the year to 31 March 2012, the company achieved its first operating profit on sales of £7.25 million, over three times the level of sales in the previous year, and both sales and profits have grown substantially to date in the current year. However, the reduction in the Tariff from 1 October 2012, combined with a noticeable tightening and lengthening of the planning permission process nationally, may affect growth in sales thereafter.

Global Immersion, which designs, builds and maintains visualisation systems for immersive theatres and planetariums worldwide, won several major orders in 2010 which led to a record order book and an operating profit of £0.5 million being achieved on sales of £8.0 million in the year to 30 June 2011. Reflecting prevailing difficult economic conditions, market demand has since fallen markedly with lengthening sales cycles, strong margin pressure and few orders being won, resulting in substantial trading losses being incurred. In consequence, administrators are expected to be appointed shortly and so a full provision of £872,061 has been made against the value of this investment.

Following a cost cutting programme, a management reorganisation and price rises for its recycled plastic products in late 2011, i-plas Group's trading improved in Spring 2012, break even EBITDA effectively being achieved in April 2012. To fund working capital, the Company invested a further £150,000 in May and June. However, during the Summer, the company then experienced a marked fall in demand from its customers in the construction industries and also significant margin pressure, resulting in growing losses. With little prospect of a sustained recovery in its markets, the decision was reluctantly made not to provide further funding, and an administrator was appointed in October, necessitating a full provision of £794,733 being made against the investment.

£96,533 was invested in April in Ixaris Systems as part of a £1.35 million fund raising to finance the continuing development of its Opn platform. Ixaris Systems, which develops and operates Entropay, a prepaid payment service using the VISA network, has also continued to develop Opn, its platform that enables enterprises to develop custom applications for payments. This platform is being used by companies in the affiliate marketing and travel sectors. In the year to 31 December 2011, an operating loss of some £0.2 million was achieved on sales of £9.1 million. In the current year, trading has been behind budget
resulting in higher than budgeted losses being incurred and a cost cutting programme being implemented as a consequence.

Meridian Technique enjoyed buoyant trading during the period for its orthopaedic surgery planning software which is sold to hospitals and surgeries, principally in the UK and USA, after some mixed trading in 2011/12. New partnerships have been established in Asia further enhancing prospects. For the year to 31 March 2012, an EBITDA of £381k was achieved on sales of £2.52 million and the company continues to be strongly cash generative.

£190,003 was invested in The Message Pad in June as part of a £771,000 rights issue to finance the continuing growth of the company's contact centre software technology division. Operating profitability was achieved recently with a growing level of contracted recurring SaaS revenues and the sales pipeline remains strong. The company was recently appointed to the G Cloud framework enabling it to provide contact centre services to all government departments.

In December 2011, the decision was made to hibernate O-Gen Acme Trek's plant in Stoke until the second generation Plymouth and Derby plants fully validated the technology and then find a partner to retro fit the facility based on experience gained from these plants. Alternative plans to redevelop the site as an 8MW power plant (nearly three times the output of the present plant) at a cost of some £26 million are also being progressed with an identified preferred technology provider and EPC contractor. A further provision of £820,258 was made against the value of the investment, reflecting delays in progressing these plans.

£16,666 was invested in Silvigen to fund urgently needed working capital during the period. Reflecting much slower than expected growth in sales and continuing losses, the decision was reluctantly made not to provide further funding, resulting in the company going into administration in September. A full provision of £401,372 was made against the cost of this investment.

TFC Europe, a leading distributor of technical fasteners in the UK and Germany, continued to enjoy strong growth during the period, having reported an operating profit of £1.6 million on sales of £16.6 million for the year ended 31 March 2012 (£1.3 million on sales of £13.5 million for the year ended 31 March 2011).

2K Manufacturing produces and sells up to 1,000 Ecosheet boards per week from its impressive fully automated Luton factory. However, limited production capacity constrains output and so the company is incurring losses. Customer demand cannot be met, even at full plant capacity, and product prices have been increased. To meet additional working capital requirements, the Company invested a further £500,000 in the period alongside management and other equity investors. Having successfully commissioned its first 10 mould production line, optimised pricing and reduced costs of raw materials to increase margin per
board, the company is now seeking to raise some £10 million to increase the number of moulding machines to 40 and increase production volumes. Discussions continue with existing and new investors to raise this necessary expansion capital, while a possible sale of the investment is also being pursued.

£34,757 was invested in Vertal during the period to fund working capital requirements. As previously noted in the Annual Report, reflecting various technical plant issues and much higher than expected disposal costs, Vertal went into administration on 21 June 2012.

New investment

In May, the Company invested £200,000 in Flowrite Refrigeration Holdings alongside other Foresight VCTs to finance the £3.2 million management buy out of Flowrite Services, a long established South East based company which provides refrigeration and air conditioning maintenance and related services nationally, principally to leisure and commercial businesses, such as hotels, clubs, pubs and restaurants. The management team has accelerated sales efforts, already winning a number of significant new customers and contracts, and a number of possible acquisitions are being considered to broaden the national coverage. Trading since May has been well ahead of budget.

Realisations

During the period, £103,000 was received from Alaric, comprising interest (£8,080), redemption premium (£61,320) and repayment of loan principal (£33,600). The Company's entire investment in AIM listed Croma Group plc's ordinary shares was sold, generating proceeds of £146,955. In addition to the January 2012 sale, a disposal in Autologic also took place in which a small number of shares were bought by a new operating partner as part of an executive incentive share scheme, generating £847 of proceeds.
Outlook

During the period under review, underlying trading at most of the portfolio companies was stronger than might have been expected, benefitting, to varying degrees, from export led demand. Conversely, although some of the environmental investments made progress, others experienced real difficulties in generating growth in sales, principally reflecting the weak UK economy, most notably Silvigen, i-plas Group and Crumb Rubber.

Such economic conditions are expected to continue for the foreseeable future resulting at best in a period of low growth. Barring another economic crisis and notwithstanding anecdotal evidence of slowing demand in Europe, we remain reasonably optimistic about current prospects for the portfolio overall. Across the portfolio, we continue to ensure that management are focused on cash conservation and cost control.

Foresight Group is pursuing potential portfolio realisations to generate value and also new investment opportunities but with appropriate caution.

David Hughes
Foresight Group
Chief Investment Officer
30 November 2012
Unaudited Half-Yearly Financial Report and Responsibility Statements

Principal Risks and Uncertainties

The principal risks faced by the Company can be divided into various areas as follows:

• Performance; 

• Regulatory; 

• Operational; and 

• Financial. 

The Board reported on the principal risks and uncertainties faced by the Company in the Annual Report and Accounts for the year ended 31 March 2012. A detailed explanation can be on found on page 23 of the Annual Report and Accounts which is available at www.foresightgroup.eu or by writing to Foresight Group at ECA Court, 24-26 South Park, Sevenoaks, Kent, TN13 1DU.

In the view of the Board, there have been no changes to the fundamental nature of these risks since the previous report and these principal risks and uncertainties are equally applicable to the remaining six months of the financial year as they were to the six months under review.

Directors' Responsibility Statement:

The Disclosure and Transparency Rules ('DTR') of the UK Listing Authority require the Directors to confirm their responsibilities in relation to the preparation and publication of the Unaudited Half-Yearly Financial Report for the six month period ended 30 September 2012.

The Directors confirm to the best of their knowledge that:

(a) the summarised set of financial statements has been prepared in accordance with the pronouncement on interim reporting issued by the Accounting Standards Board;

(b) the Unaudited Half-Yearly Financial Report for the six month period ended 30 September 2012 includes a fair review of the development and performance of the business and the position of the Company, during the first six months of the year and a description of principal risks and uncertainties that the Company
faces for the remaining six months of the year;

(c) the summarised set of financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company as required by DTR 4.2.4R; and

(d) the interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties' transactions and changes therein).

Going Concern

The Company's business activities, together with the factors likely to affect its future development, performance and position are set out in the Business Review on page 22 of the 31 March 2012 Annual Report and Accounts. The financial position of the Company, its cash flows, liquidity position and borrowing facilities are described in the Chairman's Statement, Business Review and Notes to the Accounts of the 31 March 2012 Annual Report and Accounts. In addition, the Annual Report and Accounts includes the Company's objectives, policies and processes for managing its capital; its financial risk management
objectives; details of its financial instruments and hedging activities; and its exposures to credit risk and liquidity risk.

The Company has considerable financial resources together with investments and income generated therefrom across a variety of industries and sectors. As a consequence, the Directors believe that the Company is well placed to manage its business risks successfully despite the current uncertain economic outlook.

Cash flow projections have been reviewed and show that the Company has sufficient funds to meet both its contracted expenditure and its discretionary cash outflows in the form of the share buy-back programme and dividend policy. The Company has no external loan finance in place and therefore is not exposed to any gearing covenants.

The Directors have reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the annual financial statements.

The Half-Yearly Financial Report has not been audited or reviewed by the auditors.

On behalf of the Board

Graham Ross Russell
Chairman
30 November 2012
Unaudited Income Statement
for the six month period ended 30 September 2012

The total column of this statement is the profit and loss account of the Company and the revenue and capital columns represent supplementary information.

All revenue and capital items in the above Income Statement are derived from continuing operations. No operations were acquired or discontinued in the year.

The Company has no recognised gains or losses other than those shown above, therefore no separate statement of total recognised gains and losses has been presented.
Unaudited Balance Sheet
at 30 September 2012

Unaudited Reconciliation of Movements in Shareholders' Funds
for the six month period ended 30 September 2012

Unaudited Cash Flow Statement
for the six month period ended 30 September 2012

Notes to the Unaudited Half-Yearly Financial Report
for the six month period ended 30 September 2012

1. The unaudited half-yearly results have been prepared on the basis of accounting policies set out in the statutory accounts of the Company for the year ended 31 March 2012. Unquoted investments have been valued in accordance with IPEVC guidelines. Quoted investments are stated at bid prices in accordance with IPEVC guidelines and UK Generally Accepted Accounting Practice. 

2. These are not statutory accounts in accordance with S436 of the Companies Act 2006 and the Unaudited Half-Yearly Financial Reports for the six months ended 30 September 2012 and 30 September 2011 has been neither audited nor reviewed. Statutory accounts in respect of the period to 31 March 2012 have been audited and reported on by the Company's auditors and delivered to the Registrar of Companies and included the report of the auditors which was unqualified and did not contain a statement under S498(2) or S498(3) of the Companies Act 2006. No statutory accounts in respect of any period after 31 March 2012 have been reported on by the Company's auditors or delivered to the Registrar of Companies. 

3. Copies of the Unaudited Half-Yearly Financial Report for the six month period ended 30 September 2012 have been sent to shareholders and are available for inspection at the Registered Office of the Company at ECA Court, 24-26 South Park, Sevenoaks, Kent TN13 1DU. 

Copies of the UnauditedHalf-Yearly Financial Report for the sixth month period ended 30 September 2012 are also available electronically at www.foresightgroup.eu.

4. Net asset value per Ordinary Share 

The net asset value per share is based on net assets at the end of the period and on the number of Ordinary Shares in issue at the date.

5. Return per Ordinary Share 

6. (Interest expenses)/Income 

*Where provisions have been made against the value of investments, we have also provided against income due from such investments and this is reflected in the negative loan stock interest amount above.

7. Investments held at fair value through profit or loss 

8. Related party transactions 

Foresight Group, as Investment Manager of the Company, is considered to be a related party by virtue of its management contract with the Company. During the period, services of a total value of £487,000 (30 September 2011: £609,000; 31 March 2012: £1,185,000) were purchased by the Company from Foresight Group. In addition in the period, management fees of £25,000 in respect of services in the enhanced buyback were charged to Share Premium. No fees under the performance incentive agreement were paid to Foresight Group in the period or in the previous financial year to 31 March 2012. At 30 September 2012, the amount due to Foresight Group was £nil.

                Administrative services also provided by Foresight Group, had a total value in the period of £60,000 excluding VAT (30 September 2011:
£57,000; 31 March 2012: £119,000). At 30 September 2012, the amount due to Foresight Group for administrative services was £nil.

                Foresight Fund Managers Limited, as Secretary of the Company and as a subsidiary of Foresight Group, is also considered to be a related
                party of the Company.

                No Director has, or during the period had, a contract of service with the Company. No Director was party to, or had an interest in, any contract or                                                                          
                arrangement (with the exception of Directors' fees) with the Company at any time during the period under review or as at the date of this report.

END