CAPITAL MANAGEMENT AND INVESTMENT PLC 
By
Capital Management and Investment PLC
Preliminary Results for period ended 31 July 2008
Introduction
The recent turbulence in financial markets points toward a slow down
in economic growth worldwide. Whilst we are understandably concerned
about the impact that this will have on our two investee companies,
we remain confident that Algeco Scotsman and Magticom - as market
leading companies within their respective fields - are well
positioned to cope with the difficult economic environment ahead.
Results for the half year
The Consolidated Income Statement for the six months ended 31 July
2008 shows a Profit Before Tax of £0.903m (2007 - £1.117m). This is
the result of foreign currency gains on translation of £1.23m.
CMI's investments in Algeco Scotsman and Yola are reported at fair
value. In both instances we believe fair value to be the original
cost of the investment. Net Asset Value per share is 68.9p (62.6p on
a fully diluted assuming the exercise of all the percentage warrants
outstanding).
At the end of the period, CMI had net cash balances of £4.946
million.
Investment in Algeco Scotsman
Algeco Scotsman continued to grow its business during the period. It
has continued its expansion into Eastern Europe and is exploring
business opportunities in the Middle East and China. Meanwhile, it
remains the market leader in the supply of modular space and storage
solutions in the UK, France, Germany, Spain, and the USA.
Trading for the first half of the year in Europe has been broadly in
line with budget and ahead of last year. The North American business
has faced difficult trading conditions and is behind budget.
Current year end forecasts for the combined business are in line with
expectations and are ahead of last year. The company is operating
comfortably within its banking covenants.
Investment in Yola Investments Sarl ("Yola")
CMI, via its investment in Yola, indirectly owns approximately 7% of
Magticom - the largest provider of mobile telephone services in the
Republic of Georgia.
Magticom started the year with a strong performance compared to
budget and last year. The conflict with Russia during August caused
some damage both to the Georgian economy and to future economic
prospects. The full effects of the conflict are yet to be determined.
Magticom's physical infrastructure, however, was not badly damaged by
the conflict. The company has continued to perform well although
there has been a slowdown in revenue growth.
The broader outlook for telephony services remains positive in the
longer term. We do, however, expect this investment to take longer
than originally anticipated to realise its full potential.
Strategy going forward
CMI continues to actively monitor its investments in Yola and Algeco
Scotsman through regular meetings with the management teams of Algeco
Scotsman and Magticom, receipt of monthly financial reports, and
attendance at board meetings.
CMI has no plans at present to make any further new investments.
Dividends
The board is not recommending payment of a dividend for the period
under review.
Hugh Osmond
Chairman
28th October 2008
Consolidated Income Statement
for the six month period ended 31st July 2008
Unaudited Unaudited Audited
Twelve
Six months Six months months
Ended Ended Ended
31 July 31 January
31 July 2008 2007 2008
£'000 £'000 £'000
Gain on redemption of
investments - 863 886
Fair value gain on
investments - - 81,275
Other income - - 4,662
- 863 86,823
Other administrative
expenses 3 783 (489) 1,132
Operating profit 783 374 87,955
Finance Income 120 743 1,171
Profit before tax 903 1,117 89,126
Taxation credit/
(expense) - 9 (17)
Profit for the period 903 1,126 89,109
Basic earnings per share 2 0.36p 0.45p 35.65p
Diluted earnings per
share 2 0.33p 0.41p 32.08p
Consolidated Statement of Changes in Equity
As at 31st July 2008
Share Share Merger Foreign Retained Total
Capital Premium Reserve Currency Earnings Equity
Translation
Reserve
£'000 £'000 £'000 £'000 £'000 £'000
Balance as at 1 2,499 38,109 1,693 (204) 23,742 65,839
February 2007
Exchange - - - 300 - 300
differences
arising on
translation of
foreign
operations
Credit in - - - - - -
respect of
share scheme
charge
Net income - - - 300 - 300
recognised
directly in
equity
Profit for the - - - - 1,126 1,126
period
Total - - - 300 1,126 1,426
recognised
income and
expense for the
year
Balance as at 2,499 38,109 1,693 96 24,868 67,265
31 July 2007
Exchange - - - 9,295 - 9,295
differences
arising on
translation of
foreign
operations
Credit in - - - - 73 73
respect of
share scheme
charge
Net income - - - 9,295 73 9,368
recognised
directly in
equity
Profit for the - - - - 87,986 87,986
year
Total - - - 9,295 88,059 97,354
recognised
income and
expense for the
year
Balance as at 2,499 38,109 1,693 9,391 112,927 164,619
31 January 2008
Exchange - - - 6,817 - 6,817
differences
arising on
translation of
foreign
operations
Credit in - - - - - -
respect of
share scheme
charge
Net income - - - 6,817 - 6,817
recognised
directly in
equity
Profit for the - - - - 903 903
year
Total - - - 6,817 903 7,720
recognised
income and
expense for the
year
Balance as at 2,499 38,109 1,693 16,208 113,830 172,339
31 July 2008
Consolidated Balance Sheet
As at 31st July 2008
Unaudited Unaudited Audited
Six months Six months Twelve months
Ended Ended Ended
31 July 2008 31 July 2007 31 January 2008
£'000 £'000 £'000
ASSETS
Non Current assets
Property, plant and - 3 -
equipment
Investments 171,420 28,140 163,072
171,420 28,143 163,072
Current assets
Trade and other 543 201 246
receivables
Cash and cash 4,946 39,567 5,207
equivalents
Total Current Assets 5,489 39,768 5,453
Total Assets 176,909 67,911 168,525
LIABILITIES
Current Liabilities
Trade and other (727) (509) (258)
payables
Short Term Loan (3,660) - (3,468)
Corporation tax (183) (137) (180)
payables
Total Current Liabilities (4,570) (646) (3,906)
TOTAL NET ASSETS 172,339 67,265 164,619
EQUITY
Share capital 2,499 2,499 2,499
Share premium accounts 38,109 38,109 38,109
Merger reserve 1,693 1,693 1,693
Foreign Currency 16,208 96 9,391
Translation Reserve
Profit and loss account 113,830 24,868 112,927
TOTAL EQUITY 172,339 67,265 164,619
Consolidated Cash Flow Statement
For the six months ended 31st July 2008
Unaudited Unaudited Audited
Six months Six months Twelve
months
Ended Ended Ended
31 July 2008 31 July 2007 31 January
2008
£'000 £'000 £'000
Cash flows from operating
activities
Profit for the year 903 1,126 89,109
Adjustments for:
Depreciation - 5 7
Gain on redemption of - (863) (886)
fixed assets
investments
Fair value gain on - - (81,275)
investment
Income from fixed - - -
asset investments
Finance Income (120) (743) (1,171)
Other Income - - (4,662)
Equity settled - - 73
share-based payment
expense
Foreign Exchange Gains (1,394) - (2,163)
Income tax expense - (9) 17
(611) (484) (951)
Cash flows from operating activities before changes in
working capital and provisions
Decrease/ (Increase) in trade (297) 645 600
and other receivables
Increase/ (Decrease) in trade 474 (1,195) (12)
and other payables
177 (550) 588
Cash used in operations (434) (1,034) (363)
Income taxes paid - - 10
Interest paid - 9 -
- 9 10
Net cash flows from operating (434) (1,025) (353)
activities
Investing activities
Purchase of - - (36,638)
investments
Redemption of - 1,453 -
Ristretto Holdings
shares
Interest received 120 743 1,171
120 2,196 (35,467)
Net cash from/ (used in) (314) 1,171 (35,820)
investing activities
Net cash from/ (used in) - - -
financing activities
Net Increase/ (decrease) in (314) 1,171 (35,820)
cash and cash equivalents
Cash and cash equivalents at 5,207 38,096 38,096
beginning of the year
Exchange gains/ (losses) on 53 300 2,931
cash and cash equivalents
Cash and cash equivalents at 4,946 39,567 5,207
end of the year
Notes
1 Basis of Preparation
These financial statements have been prepared in accordance with
International Financial Reporting Standards, International Accounting
Standards and Interpretations (collectively IFRS) issued by the
International Accounting Standards Board (IASB) as adopted by
European Union ("adopted IFRSs"), and are in accordance with IFRS as
issued by the IASB and with those parts of the Companies Act 1985
applicable to companies preparing its financial statements in
accordance with IFRS.
The principal accounting policies used in preparing the interim
results are those the group expects to apply in its financial
statements for the year ended 31 January 2009 and are unchanged from
those disclosed in the Group's Report and Financial Statements for
the year ended 31 January 2008.
The financial information for the six months ended 31 July 2008 and
31 July 2007 is unreviewed and unaudited and does not constitute the
Group's statutory financial statements for those periods. The
comparative financial information for the full year ended 31 January
2008 has however been derived from the audited statutory financial
statements for that period. A copy of those statutory financial
statements has been delivered to the Registrar of Companies. The
auditors' report on those accounts was unqualified, did not include
reference to any matters to which the auditors drew attention by way
of emphasis without qualifying their report and did not contain a
statement under section 237(2) -(3) of the Companies Act 1985.
2 Earnings per ordinary share
The basic earnings per share of 0.36p (2007 - 0.45p per share) is
calculated by reference to the profit after taxation of £903,000
(2007 - £1,126,000) and the weighted average number of ordinary
shares in issue during the year of 249,938,158 (2007 - 249,938,158).
The diluted earnings per share of 0.33p (2007- 0.41p per share) is
based on the above profit, and the diluted weighted average number of
ordinary shares in issue during the year. The dilutive impact on the
potential ordinary shares from unexercised warrants and share options
is shown below:
The 500,000 approved and unapproved options granted at an exercise
price of 43p are not dilutive at present. Consequently they have been
omitted from the EPS calculation.
Unaudited Six Unaudited Six Audited Twelve
months ended 31 months ended 31 months ended
July 2008 July 2007 31 January
2008
Basic number of 249,938,158 249,938,158 249,938,158
shares
Unexercised 25,410,379 27,763,401 27,831,730
warrants
275,348,537 277,701,559 277,769,888
3 Other administrative expenses
Other administrative expenses are shown as a surplus due to foreign
exchange gains of £1,230,000.
4 Interim Report
Additional copies of the interim report are available from the
Company Secretary, Capital Management and Investment PLC, 54 Baker
Street, London W1U 7BU.
This announcement was originally distributed by Hugin. The issuer is
solely responsible for the content of this announcement.
Copyright © Hugin AS 2008. All rights reserved.CAP MAN & INV : Preliminary Results
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