Devilfish Gaming plc
Announcement of results
Devilfish Gaming Plc, the multi-channel branded online gaming company, today
announces its financial results for the year ended 30 June 2009.
Main activities include:
* Successful further fund raising via Placing & Open Offer
* Announcement of Devilfish Services and Brand Alliance strategy
* Identification of potential acquisition targets
* Significant marketing activity directed at potential strategic investors
* Launch of Devilfish Casino
* Preparation for Launch of Devilfish Bingo
* Further cost cutting measures to improve gaming margins
Paul Barnes, CEO, commented:
"The online poker market has been difficult this year so far, with evidence of
stagnation and even retrenchment in some markets. The legal and competitive
environment has been challenging. There is also deep economic recession in
several of our target markets. Devilfish nevertheless was successful in raising
further funds in June and we are very happy with the generous support of our
shareholders and directors in this regard. We continue to develop the brand in
spite of very limited resources for marketing spend. We launched the Services
and Brand Alliance strategy in order to lend our know-how to operators in
non-competing markets, and to thus better identify opportunities for brand
licensing deals using our established "Devilfish" brand. We are currently
analysing opportunities for further growth through acquisition, and in parallel
entering into dialogue with potential strategic investor partners. Our
shareholders and directors continue to support us in these efforts".
24November 2009
Enquires
Devilfish Gaming
Paul Barnes, Chief Executive +353 86 825 61 51
Andrew Flitcroft, CFO +44 7769 591096
Religare Hichens, Harrison plc
Daniel Briggs +44 207 444 0500
The Directors of Devilfish Gaming plc accept responsibility for the content of
this announcement.
About Devilfish Gaming
Devilfish Gaming Plc takes its name from the well known poker professional
David "Devilfish" Ulliott, who is active in promoting the business. Ulliott is
one of Europe's best known and most recognised poker players and in 2007 had
his most successful year ever on the poker tournament circuit leading to his
winning the prestigious Card Player European Player of the Year award. The
company is publicly quoted, having floated on London's PLUS market in March
2008. The company does not accept wagers from the U.S.A.
Directors Report
Incorporation
The company is listed on the PLUS market and holds 100% of the share capital of
Devil Fish Poker Limited, an online gaming and poker company operating on the
Entraction network.
Principal activities and review of the business
The principal activity of the Group is to promote the website devilfish.com and
associated websites through which members can participate in multi-player poker
and other online gaming products via the internet. The Group also offers
professional services and is seeking strategic partners and brand alliances.
On 8 June 2009 the Company, as part of Placing and Open Offer of 10,000,000 New
Ordinary Shares of 1p each at 3p per share raised approximately £300,000 before
expenses, which amounted to approximately £48,000 (excluding VAT) of which £
5,000 was settled by the issue of 166,667 new Ordinary Shares to Religare
Hichens, Harrison plc, the company's brokers, at the Offer Price. The net
proceeds of the Placing and Open Offer have enabled the Group to continue its
present operations and to enrich the marketing mix to include, inter alia, Paid
Search (e.g. pay-per-click, Google "Adwords" etc.), and to allocate funds for
further select advertising, sponsorship, promotions and customer relationship
management, with the objective of reducing the cost per acquisition of new
players to improve the contribution margins, grow revenues further and provide
the Group with further working capital to continue the search for strategic
partners in the industry.
Throughout the whole of the year to 30 June 2009 the Group's activities have
been carried out via a marketing partnership with Entraction. Entraction is
licensed in Malta, a member state of the European Union and the European
Economic Area. This license arrangement allows Entraction, and through it the
Company, to market games, inter alia, in the UK, as Malta is on the UK's "White
List" of approved jurisdictions. This now well established key supplier
relationship with the Entraction network allows the Group to market legally in
the UK and elsewhere.
It is not yet deemed legally possible to enter the US Market, but it is the
Board's intention for the Group to do so when and if the legal environment were
ever to allow it. The Group is keeping a close eye on current legislative
lobbying in the USA in relation to legalising online poker.
The Group consists of a small team operating on a very low spend. Given the
highly competitive nature of the online poker market, our current growth focus
is on diversification and strategic alliances, whilst maintaining and growing
the core online gaming business. We aim to position ourselves optimally within
the changing environment, using our assets for the best return, and competing
where we are strongest.
The Group is currently loss making but generating month-on-month revenue
growth, achieving monthly gross revenue of over €100,000 for the first time in
April 2009. Poker has been the main growth driver with monthly yield per active
player in Q2 2009 being on average of €93 with an increasing number of active
players and registered users, up from approximately 2,400 and over 8,000
respectively in February 2009 to approximately 3,700 and approximately 13,000
in July 2009. Additionally 30 and 90 day active rolling player numbers have
increased from 625 and 1,055 respectively in January 2009 to 805 and 1,451 in
July 2009.
The Group continues to work closely with its affiliates supporting general and
specific promotions and online tournaments. These, together with the recognised
Devilfish brand, attract new affiliate partners and players. Player liquidity
on the Entraction network has continued to increase during 2009, which further
assists growth and development.
In March 2009 the Group decided to cease operating "Cardroom2", a second card
room, as the promised ability to brand it as "Devilfish" did not materialise.
The revenues from Cardroom2 were negligible. The Group has also streamlined and
simplified the online casino offering in order to facilitate marketing to
casino players both directly and via affiliates. As well as saving costs, this
has also enabled the Group to focus the marketing effort on one product per
channel which the Directors believe will further drive revenue growth.
Due to the changing market environment, the Board has decided to adopt a
diversification strategy, which will be implemented with immediate effect.
Gaming Business, the Services Business and the Brand Licensing business.
We regard ourselves as unique, because we operate an online gaming business and
share that know-how with selected businesses using high-calibre in-house
management consultants.
In addition, we own the valuable Devilfish brand, which we also license to 3rd
parties in non-competing markets. The Group intends to soon announce initial
clients for the Services Business, and we are actively seeking partners for
brand alliances.
Our site ambassador, Dave "Devilfish" Ulliott has signed a deal whereby his
autobiography will be published by Penguin. Ulliott is also in discussions in
regard to a major movie project based on his life. This extra media exposure
could work well for the further building of the Devilfish brand
internationally.
We have also developed an online forum, which has already been soft-launched,
and will be fully operational during September 2009, with the intention of
increasing community activity on the site, and opening up another channel to
communicate with our players.
The Board is now pleased to report that the affiliate management agreement with
Income Access is progressing well who are now promoting both the Group's poker
and casino channels. The Directors believe that this association will be of
great benefit to the Group.
Following the successful raise of additional funds through the Placing and Open
Offer, the Directors have approved the increased marketing and advertising
spend in order to grow the Company's core Poker business which, together with a
new marketing drive for Casino, is starting to result activity from an almost
standing start. However, this upturn has been partially hampered by the
seasonal slowdown in online gaming activity always experienced during the
summer months. The Group continues to investigate other innovative niche gaming
products. The Group continues to look for and explore potential acquisition
targets as consolidation in the market is expected.
Gross Turnover for year ended 30 June 2009 was £695,072 (7 month period ended
30 June 2008: £21,763). Direct gaming costs totalled £217,828 resulting in a
gross profit of £477,244 - a margin of 69%, before player bonuses, marketing
and promotion costs. After charging company overheads this resulted in a net
loss before taxation of £640,333 (7 month period ended 30 June 2008: £431,414).
The year's loss reflects the significant expenditure during the year on
advertising and promotion of the Devilfish brand and website which has seen
strong revenue growth. In addition part way through the year the Directors
implemented a cost cutting program removing any unnecessary expenditure which
was felt to be under-productive and in addition the number of directors has
been reduced with each agreeing to a temporary foregoing of their agreed
remuneration. These measures have yet to provide a full year's impact and will
further assist reported results in the future.
Devilfish.com now offers many different Poker and Casino games including the
most popular Poker game variations and tournaments, Caribbean Stud, several
table games such as Roulette and Blackjack, as well as a wide variety of slots,
giving the on-line gamer a wide range of product choice. In the short time that
we have been promoting the Devilfish brand on the Entraction platform,
comparing like for like data in Q2 2009 and Q4 2008:
* Average daily poker revenue increased from €1,744 to €2,758
* Average daily net gaming revenue increased from €2,102 to €3,023
* Average daily deposits doubled from €2,651 to €5,432
We have also seen growth in new player registrations during this period. We
expect growth to continue for the foreseeable future, especially as some of our
marketing and brand building initiatives have been re-activated.
Since re-launch we have been offering a range of innovative "on-brand"
promotions including regular "Devilfish" bounties and other unique value-added
tournaments, as well as network wide guaranteed prize pool tournaments.
The directors do not recommend payment of an ordinary dividend.
Future developments
It is currently envisaged that the Company will launch Devilfish Bingo in Q4
2009. We believe this is a positive move into a growth market which will
attract an additional player demographic to Devilfish. We also have the option
to offer our players a Sportsbook gaming product although the timings of this
are yet to be decided. In addition we are investigating other innovative niche
high-yield gaming products where we see an optimal mix of high brand value and
low competition.
We continue to actively recruit and sign up capable affiliate partners to
assist our growth. In order to attract the strongest companies in this area we
have made a significant investment in a fully integrated affiliate management
system which is proving to be widely appreciated by our existing affiliates and
new affiliates coming on stream. The Devilfish brand and professional
reputation of the business has meant that some significant and well respected
affiliates have signed up or are showing interest in Devilfish Poker who will
be able to drive sizeable traffic towards the site.
We are and will continue to review the market for potential acquisitions to add
shareholder value.
On behalf of the Board
David Boden
Chairman
Devilfish Gaming plc
FINANCIAL STATEMENTS
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 30 June 2009
Notes 2009 Period ended
£ 30 June
2008
£
Revenue 4 695,072 21,763
Cost of sales 5 (217,828) (39,055)
Gross profit/(loss) 477,244 (17,292)
Other income 7,845 7,788
Advertising, marketing and promotion 5 (558,248) (97,831)
Other administrative expenses 5 (567,174) (324,079)
Loss before taxation 6 (640,333) (431,414)
Taxation expense 9 - -
Loss for the period (640,333) (431,414)
Earnings per share for profit attributable to
the equity shareholders
Basic earnings per ordinary share (p) 11 (0.019) (0.019)
Diluted earnings per ordinary share (p) 11 (0.019) (0.019)
The accounting policies and notes set out on herein form an integral part of
these consolidated financial statements. There are no recognised gains and
losses other than those passing through the income statement.
The above income statement includes acquired activities.
Devilfish Gaming plc
FINANCIAL STATEMENTS
GROUP AND COMPANY BALANCE SHEET
AS AT 30 June 2009
Notes 2009 2009 2008 2008
Group Company Group Company
£ £ £ £
Assets
Non-current assets
Property, plant and equipment 12 927 - 2,436 -
Goodwill 13 2,049,689 - 2,049,689 -
Investment in subsidiary 14 - 1,950,000 - 1,950,000
Other intangibles 13 11,862 - 11,862 -
2,062,478 1,950,000 2,063,987 1,950,000
Current assets
Trade and other receivables 15 117,521 14,225 56,558 26,247
Amounts receivable from - 632,709 - 406,609
subsidiary undertakings
Cash and cash equivalents 231,926 187,164 573,072 513,059
349,447 834,098 629,630 945,915
Total assets 2,411,925 2,784,098 2,693,617 2,895,915
Equity and liabilities
Equity
Issued share capital 18 421,667 421,667 320,000 320,000
Share premium 19 2,866,772 2,866,772 2,709,362 2,709,362
Retained earnings (1,025,870) (562,269) (431,414) (182,721)
17 2,262,569 2,726,170 2,597,948 2,846,641
Current liabilities
Trade and other payables 16 149,356 57,928 95,669 49,274
Total current liabilities 149,356 57,928 95,669 49,274
Total equity and liabilities 2,411,925 2,784,098 2,693,617 2,895,915
Company amounts receivable from subsidiary undertakings amounting to £632,709
(2008: £406,609) are due after more than 1 year.
Approved by the Board for issue on 17 November 2009
Andrew Flitcroft
Finance Director
Devilfish Gaming plc
FINANCIAL STATEMENTS
GROUP Statement of changes in equity
FOR THE period ENDED 30 June 2009
Number Nominal Share Share Retained Total
of shares Value capital premium earnings £
£ £ £ £
Balance at 16 - - - - - -
October 2007
Loss for period - - - - (431,414) (431,414)
Total recognised - - - - (431,414) (431,414)
income and
expense for the
period
espense for the
period
Issue of share
capital:
Initial issue at 2 0.10 0.20 - - 0.20
incorporation
Conversion of debt 499,998 0.10 49,999.80 - - 49,999.80
to equity
Reclassification of 5,000,000 0.01 50,000 - - 50,000
shares to 1p nominal
value
Share swap for 15,000,000 0.01 150,000 1,800,000 - 1,950,000
acquisition of
Devilfish Poker
IPO share issue 12,000,000 0.01 120,000 909,362 - 1,029,362
Balance at 30 June 32,000,000 0.01 320,000 2,709,362 (431,414) 2,597,948
2008
Loss for the year - - (640,333) (640,333)
Fair value of share 45,877 45,877
options
Allotment of 1p 10,166,667 0.01 101,667 157,410 - 259,077
ordinary shares
Balance at 30 June 42,166,667 0.01 421,667 2,866,772 (1,025,870) 2,262,569
2009
Devilfish Gaming plc
FINANCIAL STATEMENTS
GROUP CASH FLOW STATEMENT
FOR THE period ENDED 30 June 2009
2009 2008
£ £
Cash flow from operating activities
Loss before taxation (640,333) (431,414)
Adjustments for:
Depreciation 3,356 712
Fair value of share options 45,877 -
Investment income (7,845) (7,788)
Increase in trade and other receivables (60,963) (47,979)
Increase in trade and other payables 53,687 61,087
Net cash outflow from operating activities (606,221) (425,382)
Cash flows from investing activities
Purchase of non-current assets (1,847) (4,617)
Net cash acquired in acquisitions - (34,079)
Interest received 7,845 7,788
Net cash inflow/(outflow) from investing activities 5,998 (30,908)
Cash flow from financing activities
Proceeds from issue of share capital 259,077 1,029,362
Net cash inflow from financing activities 259,077 1,029,362
Net (decrease)/increase in cash in the year (341,146) 573,072
Cash and cash equivalents at the beginning of the 573,072 -
year
Cash and cash equivalents at the end of the year 231,926 573,072
The accounting policies and notes set out below form an integral part of these
consolidated financial statements.
Notes to the financial information
1 General information
The principal activities of Devilfish Gaming plc ("the company") and its
subsidiary (together "the group") are earning commissions through signed up
members gained by advertising and promoting the company's website.
The company is a public limited company incorporated and domiciled in the
United Kingdom, having a registered office at 29A Stamford New Road,
Altrincham, Cheshire, WA14 1EB
The registered number of the company is 6400833
2 Basis of preparation
The consolidated financial statements of the group have been prepared in
accordance with International Financial Reporting Standards [IFRS] as developed
and published by the International Accounting Standards Board [IASB] as adopted
by the European Union [EU], IFRIC interpretations and the Companies Act 2006
applicable to companies reporting under IFRS.
Standards, amendments and interpretations to existing standards that have been
issued and are effective at the balance sheet date have been applied in the
financial statements.
The financial information has been prepared on a going concern basis under the
historical cost convention, as modified by the revaluation of certain financial
assets at fair value through the income statement.
The preparation of financial information in conformity with IFRS requires
management to exercise its judgement in the process of applying the group's
accounting policies. The areas involving a higher degree of judgement or
complexity, or areas where assumptions and estimates are significant to the
financial information are disclosed in the summary of significant accounting
policies below.
3 Summary of significant accounting policies
The principal accounting policies applied in the preparation of these
consolidated financial statements are set out below. These policies have been
consistently applied to all the periods presented, unless otherwise stated.
Basis of consolidation
Subsidiaries
Subsidiaries are all entities (including special purpose entities) over which
the group has the power to govern the financial and operating policies
generally accompanying a shareholding of more than one half of the voting
rights. The existence and effect of potential voting rights that are currently
exercisable or convertible are considered when assessing whether the group
controls another entity. Subsidiaries are fully consolidated from the date on
which control is transferred to the group. They are de-consolidated from the
date that control ceases.
The purchase method of accounting is used to account for the acquisition of
subsidiaries by the group. The cost of an acquisition is measured as the fair
value of the assets given, equity instruments issued and liabilities incurred
or assumed at the date of exchange, plus costs directly attributable to the
acquisition. Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are measured initially at their
fair values at the acquisition date, irrespective of the extent of any minority
interest. The excess of the cost of acquisition over the fair value of the
group's share of the identifiable net assets acquired, including separately
identifiable intangible assets, is recorded as goodwill. If the cost of
acquisition is less than the fair value of the net assets of the subsidiary
acquired, the difference is recognised directly in the income statement.
Inter-company transactions, balances and unrealised gains on transactions
between group companies are eliminated on consolidation.
Intangible assets
Goodwill
Goodwill represents the excess of the cost of an acquisition over the fair
value of the net identifiable assets of the acquired subsidiary at the date of
acquisition. Goodwill on acquisitions of subsidiaries is included in intangible
assets. Goodwill is tested annually for impairment and carried at cost less
accumulated impairment losses.
Acquired intangible assets - business combinations
Intangible assets that are acquired as a result of a business combination and
that can be separately measured at fair value on a reliable basis are
separately recognised on acquisition at their fair value. Amortisation is
charged on a straight-line basis to the income statement over their expected
useful economic lives.
Amortisation of intangible assets
Intangible assets are stated at cost less amortisation. Amortisation is
provided at rates calculated to write off the cost less estimated residual
value of each asset over its expected useful life as follows:
Devilfishpoker.com URL Infinite
Website design 1 year
Impairment of intangible assets
Intangible assets that have an indefinite useful life are not subject to
amortisation and are tested annually for impairment and whenever events or
circumstances indicate that the carrying amount may not be recoverable. Assets
that are subject to amortisation are tested for impairment when events or a
change in circumstances indicate that the carrying amount may not be
recoverable. An impairment loss is recognised for the amount by which the
carrying amount exceeds its recoverable amount. The recoverable amount is the
higher of the asset's fair value less costs to sell and the value in use. For
the purposes of assessing impairments, assets are grouped at the lowest levels
for which there are identifiable cash flows (cash generating units 'CGUs').
Property, plant and equipment
All property, plant and equipment is shown at cost less subsequent depreciation
and impairment. Cost includes expenditure that is attributable to the
acquisition of the items. Depreciation is provided at rates to write off the
cost less estimated residual value of each asset over its estimated useful
life, as follows:
Computer equipment 100% straight line
Office equipment 33% straight line
The residual values and lives of assets are reviewed and adjusted, if
appropriate, at each balance sheet date.
Trade and other receivables
Trade and other receivables are recognised initially at fair value and
subsequently measured at amortised cost using the effective interest method,
less provision for impairment. A provision for impairment of trade receivables
is established when there is objective evidence that the group will not be able
to collect all amounts due according to the original terms of the receivables.
Significant financial difficulties of the debtor, probability that the debtor
will enter bankruptcy or financial reorganisation, and default or delinquency
in payments are considered indicators that the trade receivable is impaired.
The amount of any provision is the difference between the asset's carrying
amount and the present value of estimated future cash flows, discounted at the
original effective interest rate. The carrying amount of the asset is reduced
through the use of an allowance account, and the amount of the loss is
recognised in the income statement within "administrative expenses". When a
trade receivable is uncollectible, it is written off against the allowance
account for trade receivables. Subsequent recoveries of amounts previously
written off are credited against "administrative expenses" in the income
statement.
Cash and cash equivalents
Cash comprises cash on hand and demand deposits. Cash equivalents are short
term, highly liquid investments that are readily convertible to known amounts
of cash.
Trade and other payables
Trade and other payables are recognised initially at fair value and
subsequently measured at amortised cost using the effective interest method.
Foreign currency translation
(a) Functional and presentation currency
The consolidated financial information is presented in pounds sterling, which
is the group's functional and presentation currency.
(b) Transactions and balances
Foreign currency transactions are translated into the functional currency using
the exchange rates prevailing at the dates of the transactions. Foreign
exchange gains and losses resulting from the settlement of such transactions
and from the translation at year-end exchange rates of monetary assets and
liabilities denominated in foreign currencies are recognised in the income
statement.
Revenue recognition
Revenue from services is derived primarily by marketing online gaming products
available by the groups associated websites. These online games comprise of
Poker and Casino, with the revenue recognised in the accounting periods in
which the underlying gaming transactions occur. Revenue represents the
commission charged or tournament entry fees where the player has concluded his
or her participation in the tournament. Casino revenue represents net house
win. All revenue is calculated gross before any promotional bonuses.
Segmental reporting
A business segment is a group of assets or operations engaged in providing
services that are subject to risks and returns that are different from those of
other business segments. A geographical segment is engaged in providing
services within a particular economic environment that is subject to different
risks and returns from other segments in other economic environments.
Expenses
All expenses are accounted for on an accruals basis.
Current and deferred income tax
The current income tax charge is calculated on the basis of the tax laws
enacted or substantively enacted at the balance sheet date in the countries
where the company's subsidiaries operate and generate taxable income.
Management periodically evaluates positions taken in tax returns with respect
to situations in which applicable tax regulation is subject to interpretation
and establishes provisions where appropriate on the basis of amounts expected
to be paid to the tax authorities.
Deferred income tax is provided in full, using the liability method, on
temporary differences arising between the tax bases of assets and liabilities
and their carrying amounts in the consolidated financial information. However,
the deferred income tax is not accounted for if it arises from initial
recognition of an asset or liability in a transaction other than a business
combination that at the time of the transaction affects neither accounting nor
taxable profit or loss. Deferred income tax is determined using tax rates (and
laws) that have been enacted or substantially enacted by the balance sheet date
and are expected to apply when the related deferred income tax asset is
realised or the deferred income tax liability is settled.
Deferred income tax assets are recognised to the extent that it is probable
that future taxable profit will be available against which the temporary
differences can be utilised.
Deferred income tax is provided on temporary differences arising on investments
in subsidiaries, except where the timing of the reversal of the temporary
difference is controlled by the group and it is probable that the temporary
difference will not reverse in the foreseeable future.
Capital
The Group's objectives when managing capital are to safeguard the Group's
ability to continue as a going concern in order to provide returns for
shareholders and benefits for other stakeholders and to maintain a capital
structure that optimises the cost of capital. In order to maintain or adjust
the capital structure the Group may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new shares or sell assets
to reduce debt.
Capital comprises all components of equity; share capital, share premium, and
retained earnings.
Equity Settled share option plan
The Company has applied the requirements of IFRS2 Share-based payments in
accordance with current provisions. The company issues equity-settled share
based payments to certain employees, which are measured at fair value at the
date of grant. The fair value determined at the date of grant is expensed on a
straight line basis over the vesting period, based on the company's estimate of
shares that will eventually vest. The fair value is determined by use of the
share based payments intrinsic value. Management do not believe the fair value
can be measured reliably by use of an option pricing model, based on the fact
that the company has only relatively recently obtained a listing and no
reliable historical data is available.
Future changes in accounting policies - standards issued but not yet effective
A revised IAS 1, Presentation of Financial Statements, was issued in September
2007 and becomes effective for financial years beginning on or after 1 January
2009. The revision is aimed at improving the users' ability to analyse and
compare the information given in financial statements and will create
significant changes to the format of the primary statements.
IFRS 8, operating segments, becomes effective 1 January 2009 and requires
entities to disclose information to enable users of its financial statements to
evaluate the nature and financial effects of the business activities in which
it engages. This may result in additional disclosure for the Group but will not
materially impact its results.
The following standards are not expected to have any impact on the Group's
financial statements:
- A revised IAS 23, borrowing costs, issued in March 2007 and effective for
financial years beginning in or after 1 January 2009.
- A revision to IAS 27, consolidated and separate financial statements, issued
in 2008 and effective 1 July 2009.
- An amendment to IFRS2, share based payment, effective for accounting periods
beginning on or after 1 July 2009.
- A revision to IFRS 3, business combinations, will come into effect from July
2009.
- An amendment to IFRS 5, non-current assets held for sale and discontinued
operations effective from 1 July 2009.
- An amendment to IAS 32, financial instruments: presentation and IAS 39,
financial instruments: recognition and measurement effective from 1 July 2009.
- IFRIC 15, issued in July 2008, dealing with agreements for the construction
of real estate.
- IFRIC 16, issued in July 2008, dealing with the hedging of net investments in
foreign operations.
- IFRIC 17, issued in November 2008, dealing with the distribution of non-cash
assets to owners.
- IFRIC 18, issued in November 2008, dealing with the transfer of assets from
customers.
4 Segmental analysis
Based on risks and returns, the directors consider that the primary reporting
format is by business segment. The directors consider that there is only one
business segment, being the commission earned through signed up members gained
by advertising and promoting the company's website. Therefore, the disclosures
for the primary segment have already been given in this financial information.
Geographical segment
2009 2008
£ £
Revenue from services:
UK 152,752 11,471
Other European 379,184 9,700
Rest of the world 163,136 592
Total 695,072 21,763
2009 2008
£ £
Non current assets - additions at cost
UK 1,847 2,078,485
Other European - -
Rest of the world - -
Total 1,847 2,078,485
2009 2008
£ £
Balance sheet - Net book value of segment assets
UK 2,062,478 2,063,987
Other European - -
Rest of the world - -
Total 2,062,478 2,063,987
5 Expenses
The following material expenses are included in cost of sales:
2009 2008
£ £
Entraction - set up fee - 31,600
The following material expenses are included in advertising, marketing and
promotion:
2009 2008
£ £
Advertising and marketing 185,834 40,949
Promotional activity 333,059 22,069
PR costs 39,355 34,813
The following material expenses are included in administrative expenses:
2009 2008
£ £
Directors' emoluments 270,081 146,850
Hotel and travel 34,860 31,960
Professional fees 50,846 72,650
Fair value of share options 45,877 -
6 Loss before tax
Loss before tax, all of which arises from the group's principal activities, is
stated after charging:
2009 2008
£ £
Auditors' remuneration:
- Audit services 9,000 3,500
- Other services 4,134 7,500
Depreciation expense 3,356 712
Exchange differences 499 -
7 Loss attributable to the parent company
As permitted by section 408(4) of the Companies Act 2006, the company has not
presented its own separate income statement. The loss for the period dealt with
in the accounts of the parent company is £425,425 (2008: £182,721).
8 Key management and directors emoluments
2009 2008
£ £
Directors' emoluments 270,081 146,850
Emoluments of the highest paid director 111,318 63,860
There are no employees of the group except for the directors.
9 Taxation expense
The taxation provision for the period is different to the standard rate of
corporation tax in the UK of 28%. The differences are explained below:
2009 2008
£ £
Loss before tax (640,333) (431,414)
Taxation at the UK corporation tax rate of 28% (2008 (179,293) (129,424)
- 30%)
Effects of:
Loss during the year 179,293 129,424
Tax expense - -
No deferred tax asset has been provided in respect of tax losses as their
crystallisation is not certain. The subsidiary has pre acquisition tax losses
brought forward and the deferred tax asset not provided for at 28% amounts to
approximately £508,000. The amount of deferred tax not provided for in respect
of post acquisition losses at 28% amounts to approximately £301,000.
10 Dividends
No dividends have been proposed by the company for the year ended 30 June 2009
or the prior period.
11 Earnings per share
The calculation of the basic earnings per share is based on the earnings
attributable to ordinary shareholders divided by the weighted average number of
shares in issue during the year.
The calculations of diluted earnings per share are based on the basic earnings
per share adjusted to allow for the issue of shares on the assumed conversion
of all dilutive options.
Reconciliation of the earnings and weighted average number of shares in the
calculations are set out below.
2009 2008
Earnings Weighted Per Earnings Weighted Per
average share average share
£ number of amount £ number of amount
shares (pence) shares (pence)
Basic earnings per (640,333) 32,847,222 (0.019) (431,414) 23,294,120 (0.019)
share
Diluted earnings per (640,333) 32,847,222 (0.019) (431,414) 23,294,120 (0.019)
share
5,709,436 (2008: 4,265,632) share options have not been included in the above
as they are anti-dilutive.
END
DEVILFISH GAMING PLC
