SIGMA CAPITAL GROUP PLC (“Sigma”)
Sigma issues the following statement ahead of its Preliminary Results Announcement in April 2008.
On 19 December 2007, we issued a trading update in which we advised that the downturn in the property sector had impacted the timing of the completion of transactions and fees in the property side of Sigma’s business. With the hardening of sentiment since then, we expect that our seventh property limited partnership (Si Limited Partnership No 7) which we had planned to close at the end of January 2008 will now close during April. The financial impact of this delay is to move the majority of revenue for this transaction from 2007 to 2008. The total revenue that we will earn from Si Limited Partnership No 7 is unchanged at £2.6 million. However, we will now only book approximately 33% of revenue in 2007 rather than our original estimate of 75% of revenue. The balance will be accounted for in the current financial year to 31 December 2008. This has a corresponding effect on the split of profit that we will earn on this transaction.
Since the year end, we have also been able to assess the IFRS impact on our financials for the year ended 31 December 2007. At the beginning of this month, one of the investments in our Sigma Technology Venture Fund (“the Fund”) was placed into a Pre-pack Administration. We therefore feel it prudent to write off this investment as at 31 December 2007. In addition, in line with the market in general, there has been some reduction in the value of quoted investments held by the Fund. As a result, our previous estimate of the impact of IFRS has changed by £200,000 from a small upward movement to a negative impact of £167,000.
In the December trading update, we stated that it was not possible to be definitive as to what impact additional money raised for the Sigma Sustainable Energy Fund II (“SSEF II”) would have on Sigma’s revenue and profit for the financial year to 31 December 2007. This is because any new limited partners are treated as though they had joined SSEF II in June 2007 in terms of commitment to pay management fees. We have now clarified with our auditors that, while any additional money raised will generate fees backdated to June 2007, the monies will not be recognised as income in 2007, but will all be recognised in 2008. This will have a corresponding benefit for 2008 and we remain confident of adding additional limited partners to the SSEF II.
The impact of the above on our results for the year ended 31 December 2007 is that profit before tax is likely to be no more than £1.65 million. We expect our earnings per share for 2007 to be at a similar level to 2006. The deferral of income from 2007 to 2008 further strengthens the prospects for growth in the business in the current year and the Board remains confident of the year ahead.
Enquiries
Sigma Capital Group plc
Graham Barnet, Chief Executive
T: 0131 220 9444
Marilyn Cole, Finance Director
T: 0131 220 9444
Biddicks
Katie Tzouliadis
T: 020 7448 1000
Arbuthnot Securities
Tom Griffiths/ Neil Kirton
T: 020 7012 2000
About Sigma Capital Group plc
Founded in 1997 and based in Edinburgh, Sigma Capital Group plc is an AIM-quoted, specialist asset management and advisory group. Sigma focuses on specialist fund management, commercialisation of University IP and property investment.
Sigma currently has two university IP commercialisation agreements, with the University of Dundee and the Robert Gordon University. Through these agreements, Sigma works with the commercialisation teams of each university, providing advice and support to ensure that the commercial opportunities of any technologies developed within these universities are maximised.