28 May 2010 V22 PLC ('V22' or 'THE COMPANY') (PLUS: V220) AUDITED FINANCIAL RESULTS FOR THE FINANCIAL YEAR TO 31 DECEMBER 2009 V22, the first publicly traded contemporary art collection, announces audited final results for the 12 months ending 31 December 2009 HIGHLIGHTS - Independent valuation of the art collection £715,816. - Growth over the period of 2009 of 16.7%; growth over cost of 104.6% - Net asset value per share 1.358p; (2008: 1.565p) - Net asset value per share including revaluation 2.949p ; (2008: 2.845p) - Operating loss held at £ 52,648 (2008 £91,664). - Generated positive cash flow of £8,432. - Year end net cash £ 28,729. - Further expansion into studio provision The Directors of the Issuer accept responsibility for this announcement. ---ENDS--- Contact Details: V22 plc Tel: 020 79232950 Tara Cranswick tara@v22collection.com Rivington Street Corporate Finance Tel: 020 7562 3373 Eran Zucker Eran@rs-cf.com CHAIRMAN'S REPORT The Directors of V22 are pleased to report results for the 12 months to 31 December 2009 and the third independent valuation of the V22 art collection. In terms of asset growth, we are delighted with the revaluation results. The company has developed a large and diverse art collection which has increased in value, worked steadily to a point where advisory and running costs are covered by its subsidiary, and continues to develop a strong brand name and reputation within the London and international art communities. Since the collection started in September 2006, to 31 December 2009, V22 has invested £349,788 (£216,987 cash and £132,801 equity) in the collection. The independent valuation estimated the works to be worth £715,816, an uplift of £ 366,028 - a gain of 104.6%. For the third valuation V22 chose to work again with Webb Valuations. Webb Valuations' founder, David Webb FRICS, undertook the valuation himself with specialist advice from his contemporary art consultants. David has been involved in the art world for over 30 years including working for Bonhams and as a deputy director of Sotheby's London. He also set up and managed the UK Valuation Department at Sotheby's new West London saleroom at Olympia. The market still represents some excellent buying opportunities, and the acquisition of a number of works took place at the end of 2009 with capital saved from V22 London's ancillary revenue streams. 51 international artists are currently represented in the V22 collection, which has grown to now include 113 works of art. PROMOTION 2009 A series of exhibitions and events continue to grow the profile of V22 and have contributed to our following in the art world, financial circles and with the press. In 2009 V22 continued to work with Workspace Group plc who previously offered all their available space for V22 exhibitions. This resulted in a large exhibition - V22 PRESENTS: The Sculpture Show - in a large and beautiful warehouse just south of the Thames in Bermondsey. Works by nearly 100 artists were exhibited, including such luminaries as Henry Moore, Naum Gabo, and Richard Smith, YBA's The Chapman Brothers and Sarah Lucas and the English father of conceptual art Richard Wentworth; over 3000 people attended the show; the curators were asked to speak about it on the radio and at international sculpture symposia; it was featured as Time Out's pick of the week; and an artist was thereafter chosen to exhibit at the Serpentine Gallery. Altogether a fantastic success for the V22 brand; not only did it increase our profile and reputation, but also formed a selection of artists for the V22 collection. In October 2009, V22 worked in partnership with Intelligence Squared, the Barbican, the Royal Festival Hall and a host of London's museums and cinemas to present works by acclaimed German director Werner Herzog. The film festival was timed around Herzog's visit to London and he, rather exceptionally, gave his permission for V22 to screen his films. The series was titled V22 PRESENTS: Werner Herzog, and included 26 films and documentaries; it was featured in major newspapers, magazines and London guides and was enjoyed to many sell-out audiences. Also in October, to coincide with London's massive Frieze Art fair, V22 London decided to open a part of its former gallery space in Dalston. The series of shows designed for the space are solo installations by artists who have reached an exceptional level in their careers, and are excited by the chance to work for extended periods of time to create exhibitions in a large space - a luxury unafforded by the commercial galleries. The series started with Fergal Stapleton. Our audience included many of London's stars of the art world, the exhibition was featured in Art Forum as one of London's best shows and received great critical acclaim. V22 was again invited by Edelman plc - an international PR company - to provide art for their new offices in Victoria with Director Tara Cranswick being personally commissioned to make a large scale installation for the same offices. The Contemporary Arts Society negotiated the loan of two V22 works for display in a new Norman Foster development in Bath, parts of the collection remain on loan to shareholders and a number of works have been loaned to external exhibitions. MANAGEMENT V22 London Ltd Our subsidiary in London continues to manage the collection, its loan and exhibition, as well as increase the profile and relevance of V22 and the development of ancillary revenues to fund the costs of the collection. V22 London is still managing its building - V22 ASHWINSTREET. The building is fully let and the gallery space has partly reopened for a series of high profile solo exhibitions. V22 London is working in partnership with Workspace Group plc to use their empty spaces as additional studio space for artists. This has proved to be an excellent opportunity to turn a depressed property market to our advantage and increase our revenue in a simple and effective manner. V22 London signed a lease with Workspace for a large 14,400 sq ft building just behind the Tate Modern for artist studio space at a very advantageous rate. The lease was signed at the end of April 2009, and, after an initial period of works, the building was 75% let within 3 months and full within 5 months. A loss of £15,131 (2008 £61,076) reflected the continuous development of V22 as well as losses arising from the very nature of the business, representing an indirect cost of acquiring and holding the collection. We continue to mitigate this cost by offsetting it against new and existing sources of revenue. The management team is heavily invested in the future success of the business and, once again, much of the increase in the valuation of the collection is due to the team's buying and negotiating skills. The team continues to work tirelessly to improve and expand the asset base and to enhance shareholder value. THE ART MARKET Things are still largely cautious in the market, but the last contemporary auction results proved more optimistic: Sotheby's NY November sale sold 52 of 54 lots, or more than 96 percent, for a total of $134,438,000 with premium. The sum was well above the $74.1 million total at Christie's New York the night before, and a bit more than the $125 million Sotheby's did in May 2009. Frieze Art Fair in October reported "clear evidence of renewed confidence in the contemporary art market" at the fair, and Artprice reported in November that their Art Market Confidence Indicator showed that medium-term confidence had substantially improved with 60% of respondents expecting to see art prices increasing over the following three months. Art Basel Miami Beach in December boasted "exceptional high quality and very solid sales" with major dealers reporting that the art market was stabilising and gaining momentum. The World Wealth Report, published by Capgemini and Merrill Lynch, reported that buyers had scaled back on "investments of passion"-yachts, jets, cars, jewellery and so on, but the proportion of all luxury spending that went on art increased as investors looked for assets that would hold their value in the longer term. V22 is still in the buying, not the selling, phase of its development. The structure of V22 involves artists in the ownership of the company, invests in high quality art for the longer term and supports the market not only through collecting but also through exhibition and studio space. The Directors believe that after 3 years of trading, including 2009 which was a difficult year, the business model has proved itself. FUTURE STRATEGY At the end of 2009, with the new studio building being filled, V22 London negotiated with artist Shahin Afrassiabi to take a studio at V22 ASHWINSTREET in lieu of payment for artwork. This means that V22 London can assist in the development of the collection without the loss of cash which this normally entails. This method of working is excellent for artists and V22 and may be pursued in the future. With our third valuation we have proved once again that our choice of art has been solid under the most adverse conditions. Looking forward we shall continue to expand our revenue streams, keep costs low, hold and promote our growing collection of art and identify the wealth of opportunities we believe exist in the current market and in our current phase of development. We have completed our third full year of trading, are emerging from the development phase of the business and believe that our ability to achieve and sustain growth in the assets of the company has been supported yet again by the revaluation of the collection. As we did in 2009, while monitoring the market carefully, we will continue to grow the collection with a small list of impressive artists. As ever, in closing we would like to thank our artists, shareholders, staff, advisors and friends for their continued support and enthusiasm for our exciting and unique venture. T Cranswick - Co Chairman J Banks - Co Chairman CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31 DECEMEBER 2009 2009 2008 £ £ TURNOVER 6,612 10,492 Cost of Sales 8,630 6,551 --------- --------- (2,018) 3,941 GROSS PROFIT Administrative Expenses 212,942 166,214 --------- --------- (214,960) (162,273) Other Operating Income 162,559 68,665 --------- --------- OPERATING LOSS (52,401) (93,608) Interest receivable and similar income 3 2,194 --------- --------- LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (52,398) (91,414) Tax on loss on ordinary activities 250 250 --------- --------- LOSS FOR THE FINANCIAL YEAR AFTER TAXATION (52,648) (91,664) ======= ======= LOSS PER SHARE (0.24) p (0.43) p ======= ======= CONTINUING OPERATIONS None of the group's activities were acquired or discontinued during the current year or previous period. TOTAL RECOGNISED GAINS AND LOSSES The group has no recognised gains or losses other than the loss for the current year and the loss for the previous period. CONSOLIDATED BALANCE SHEET FOR THE YEAR ENDED 31 DECEMEBER 2009 2009 2008 £ £ £ £ FIXED ASSESTS Tangible Assets 8,631 15,264 CURRENT ASSETS Debtors 25,544 34,977 Trade Investments 349,788 330,998 Cash at Bank in hand 28,729 20,297 --------- --------- 404,061 386,272 CREDITORS Amounts falling due within one year 100,541 56,644 --------- --------- NET CURRENT ASSETS 303,520 329,628 TOTAL ASSETS LESS CURRENT LIABILITIES 312,151 344,892 ======= ======= CAPITAL AND RESERVES Called up share capital 5,601 5,507 Share premium 512,204 492,391 Other reserves 74,479 74,479 Profit and loss account (280,133) (227,485) ======= ======= SHAREHOLDERS FUNDS 312,151 344,892 ======= ======= NOTES 1. The financial information set out in this announcement does not constitute statutory accounts. This financial information has been extracted from the audited full accounts of the Group for the year ended 31 December 2009. 2. The financial statements are prepared in accordance with applicable United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). 3. The directors do not recommend the payment of a dividend. 4. The art collection was valued at the balance sheet date by a firm of specialist valuers 'Webb Valuations Fine Art Ltd' at a primary market value of £715,816 (2008: £613,201), which shows an uplift in value over cost of £ 366,028 (2008: £282,203). On the Balance Sheet the art collection is valued at cost under Trade Investments. NOTES TO EDITORS About V22 V22 is the first publicly traded collective art collection. The company collects contemporary art on the advice of international experts in the field. V22's focus is mainly on emerging and mid career artists with the potential for good investment growth. The pioneering model involves artists in share ownership of the company, thereby creating a solid bank of expertise from which to draw. The team's involvement in the art world enables the company to buy seminal pieces at excellent prices. www.V22collection.com END
V22 PLC