INTER-ALLIANCE
Consolidated Profit and Loss Account
 
for the year ended 31 December 2003
                                                                                                         After
                                            Before                   After      Before Exceptional Exceptional
                                       Exceptional Exceptional exceptional exceptional       items       Items
                                             items       items       items       items    restated    Restated
                                              2003        2003        2003        2002        2002        2002
                                  Note       £'000       £'000       £'000       £'000       £'000       £'000
Turnover                           1,2
Existing operations                         61,469           -      61,469      51,499           -      51,499
Acquisitions                                 2,150           -       2,150           -           -           -
Continuing operations                       63,619           -      63,619      51,499           -      51,499
Discontinued operations                          -           -           -         429           -         429
                                            63,619           -      63,619      51,928           -      51,928
Cost of sales                        3    (47,639)           -    (47,639)    (41,738)           -    (41,738)
Gross profit                                15,980           -      15,980      10,190           -      10,190
Other operating expenses (net)   3,5,7    (36,009)     (7,004)    (43,013)    (21,170)     (1,505)    (22,675)
Operating loss                       2    (20,029)     (7,004)    (27,033)    (10,980)     (1,505)    (12,485)
Existing operations                       (19,860)     (7,004)    (26,864)    (10,893)     (1,505)    (12,398)
Acquisitions                                 (169)           -       (169)           -           -           -
Continuing operations                     (20,029)     (7,004)    (27,033)    (10,893)     (1,505)    (12,398)
Discontinued operations                          -           -           -        (87)           -        (87)
                                          (20,029)     (7,004)    (27,033)    (10,980)     (1,505)    (12,485)
Share of net operating loss of     6,7       (728)     (4,706)     (5,434)     (1,519)       (139)     (1,658)
associates
Profit on sale of subsidiary                     -           -           -         278           -         278
- discontinued operations
Costs of a fundamental               7           -     (1,149)     (1,149)           -     (4,154)     (4,154)
restructuring
- continuing operations
Loss before interest and                  (20,757)    (12,859)    (33,616)    (12,221)     (5,798)    (18,019)
taxation
Net interest receivable/             8
(payable) and similar income/
(charges)
- Group                                        166           -         166         297           -         297
- Associates                                  (12)        (49)        (61)        (52)           -        (52)
Loss on ordinary activities        5,6    (20,603)    (12,908)    (33,511)    (11,976)     (5,798)    (17,774)
before taxation
Tax on loss on ordinary              9           -           -           -          18           -          18
activities
Loss on ordinary activities               (20,603)    (12,908)    (33,511)    (11,958)     (5,798)    (17,756)
after taxation
Minority interests                  30          36           -          36          28           -          28
Loss for the financial year               (20,567)    (12,908)    (33,475)    (11,930)     (5,798)    (17,728)
 
Basic and diluted loss per share    11                              (7.8p)                             (21.3p)
 
 
 
There are no recognised gains or losses in either year other than the loss for
each financial year.
 
There is no material difference between the result disclosed in the consolidated
profit and loss account and the result on an unmodified historical cost basis
for both periods.
 
The accompanying notes are an integral part of this consolidated profit and loss
account.
 
 
 
Consolidated Balance Sheet
 
31 December 2003
                                                                                                 Restated
                                                                                 2003                2002
                                                               Note             £'000               £'000
Fixed assets
Trademark                                                        12                 2                   2
Goodwill                                                         13            12,078              12,826
Intangible assets                                                              12,080              12,828
Tangible assets                                                  14             3,223               5,494
                                                                               15,303              18,322
Current assets
Debtors
- due within one year                                            19             5,575               8,024
- due after one year                                             20             2,096                 652
Investments                                                      21             6,092                   -
Cash at bank and in hand                                         22             4,314               8,080
                                                                               18,077              16,756
Creditors: amounts falling due within one year                   23          (12,445)             (9,679)
Net current assets                                                              5,632               7,077
Total assets less current liabilities                                          20,935              25,399
Creditors: amounts falling due after more than one year          24             (601)               (564)
Provisions for liabilities and charges                           25           (1,894)             (2,092)
Net assets                                                                     18,440              22,743
 
Capital and reserves
Called up share capital                                      27, 28             9,079               1,033
Share premium account                                            28            95,573              74,106
Own shares reserve                                               28           (1,429)             (1,429)
Share option reserve                                             28               858                 796
Merger reserve                                                   28               130                 130
Shares to be issued reserve                                      28                70                 470
Profit and loss account                                          28          (85,838)            (52,363)
Shareholders' funds - equity interests                           29            18,443              22,743
Equity minority interests                                        30               (3)                   -
Total capital employed                                                         18,440              22,743
 
 
 
The accompanying notes are an integral part of this consolidated balance sheet.
 
The financial statements on pages 14 to 45 were approved by the Board on 30
June2004 and signed on its behalf by:
 
KA Carby                                                SM Hartley
Chairman                                                Director
 
 
 
 
 
Company Balance Sheet
 
31 December 2003
                                                                                                  Restated
                                                                                    2003              2002
                                                                   Note            £'000             £'000
Fixed assets
Intangible assets - Trademark                                        12                2                 2
Tangible assets                                                      14              127             4,168
Investments in subsidiary undertakings                               16           15,474            14,456
                                                                                  15,603            18,626
Current assets
Debtors
- due within one year                                                19            7,815             7,541
- due after one year                                                 20            2,022               652
Investments                                                          21            6,092                 -
Cash at bank and in hand                                             22            1,757             6,988
                                                                                  17,686            15,181
Creditors: amounts falling due within one year                       23         (12,188)           (9,539)
Net current assets                                                                 5,498             5,642
Total assets less current liabilities                                             21,101            24,268
Creditors: amounts falling due after more than one year              24            (448)             (448)
Provisions for liabilities and charges                               25          (1,615)           (1,154)
Net assets                                                                        19,038            22,666
 
Capital and reserves
Called up share capital                                          27, 28            9,079             1,033
Share premium account                                                28           95,573            74,106
Own shares reserve                                                   28          (1,429)           (1,429)
Share option reserve                                                 28              858                 -
Profit and loss account                                              28         (85,043)          (51,044)
Shareholders' funds - equity interests                                            19,038            22,666
 
 
 
The financial statements on pages 14 to 45 were approved by the Board on 30 June
2004 and signed on its behalf by:
 
KA Carby                                             SM Hartley
Chairman                                             Director
 
 
 
 
 
Consolidated Cash Flow Statement
 
for the year ended 31 December 2003
                                                                                  2003               2002
                                                                    Note         £'000              £'000
Net cash outflow from operating activities                            31      (25,239)           (21,944)
Returns on investments and servicing of finance                       32            19                297
Taxation                                                              32             -                  -
Capital expenditure                                                   32         (658)            (3,929)
Acquisitions and disposals                                            32       (1,337)            (3,274)
Cash outflow before financing                                                 (27,215)           (28,850)
Management of liquid resources                                        32       (6,000)                  -
Financing                                                             32        32,565             28,007
Decrease in cash in the year                                                     (650)              (843)