Disposal of Subsidiary
2 February 2007
PHSC plc announces the disposal of its Health and Safety Click Limited (HSC) subsidiary on 31 January 2007. This course of action was noted in the interim report, where the Board stated that it had determined that such a disposal would be in the best interests of the group. HSC was acquired in the full knowledge that further investment would be required to enable the company to reach its potential, and various measures were taken to facilitate this. Whilst the HSC concept remained an attractive one, the Board took the view that PHSC plc should concentrate its efforts on maximising shareholder value from companies in the sector that are already sufficiently well established to be cash-generative.
Under PHSC ownership, HSC was not forecast to become significantly profitable over the next two years and thus does not fit this model. Working with HSC since August 2005 has given valuable insights into the ways that an internet-based provider can deliver a service, and the Board believe that a faster route and certainly a more cost-effective way into this particular market can be achieved by developing web-based offerings through other Group subsidiaries. HSC made a trading loss of £ 26,000 in the current financial year to date. Under the agreement, the new owner of HSC has redeemed loans totalling £14,275 that were already in place before the company was originally acquired by PHSC plc. Furthermore, the terms of the disposal provide that PHSC plc are entitled to 33% of any profits generated by HSC in the next twelve months, and 25% of any profits in the twelve months thereafter.
For further information please contact:
Stephen King 01622 717700
Ruegg & Co Limited
Gavin Burnell 020 7584 3663
Hichens, Harrison & Co. plc
Daniel Briggs (Tel: 020 782 7776)