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| Subject: The technological benefits of the Proton acquisition ratified 28/11 | |
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Author: anonymous |
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Date Posted: 15:32:15 11/24/02 Sun The technological benefits of the Proton acquisition (even though ERG acquired it on March 15th 2002) did not flow through to the accounts till late June. The date is June 26th. ------------------------------------------------------------ The entity between March 15th and June 30th 2002---for a three month period experienced 100%---which was a loss of approximately (Proton) 2.1 million dollars. When next reporting the intangible patents and technological processes that Proton has will be valued on a commercialisation basis---Proton has expensed all research and development costs this affects the bottom line in the year it is done---it does not affect it from year one in the commercial process. ------------------------------------------------------------ It's assets and revenues from the very early stages of the above will be refelected in ERG Consolidated Groups accounts, when reporting half yearly in March of 2003. A patent--Proton has 16 of them is an intangible untill you can prove that by commercialising it---it is capable of earning you income. ------------------------------------------------------------ http://www.erg.com.au/invst_relations/prospectus/prospectus_for_lodgement.pdf ------------------------------------------------------------ PWI was formed in 1998 and its current shareholders are Banksys (60%), Amex (10%), Interpay (10%), Visa (10%) and ERG Card Systems Ltd (10%). Following completion of the acquisition ERG will own 100% of PWI. ------------------------------------------------------------ 4.1.8 PWI Financial Information The financial performance of PWI to date has been based largely on licence fees from the licensing of its core technology to customers globally. ------------------------------------------------------------ Over the past 12 to 18 months those customers have provided PWI with specific details of the functionality and products they require. As a result, PWI set out to develop Proton Prisma and the Proton Conquesta range of products. These products will only become available to the market at the end of this year and the beginning of next year. ------------------------------------------------------------ At that time PWI will move from a basic technology developer to a commercial organisation capable of exploiting its technology and providing a range of services to its customer base. Many of the licences taken up will only see cards issued for the first time in 2002. ------------------------------------------------------------ Based upon its own estimates and estimates provided by the existing licensees, PWI expects to see the number of cards issued globally incorporating its technology grow from 36 million today to over 100 million within two to three years. That card base should generate increasing revenue for PWI.ERG LIMITED ABN 23 009 112 725 ------------------------------------------------------------ The research component of PWI’s business will progressively move to development and support of its customer base on a fee-for-service basis.PWI Profit and Loss Statement (€ 000) 6 months to 12 months to 19 months to 30 June 2001 31 Dec 2000 31 Dec 1999(Unaudited) (Audited) (Audited)Revenues 4,935 18,278 30,816Operating charges (13,487) (24,327) (31,049) Operating profit (loss) (8,552) (6,049) (233)Financial income 57 464 896Financial charges including interest – (234) (767) Profit (loss) on ordinary activitiesbefore tax (8,495) (5,819) (104) In the financial year ended 31 December 2000, PWI's total revenue was €18.3m. PWI shareholders (including ERG) and related companies represented €7.2m or 39.4% of this revenue, and royalties and card fees made up 6.7% of thisrevenue. In the past 12 months, PWI has focused on the development of its new technology. PWI incurred losses prior to 30 June 2001 as a result of:• the benefits of these new technology developments not flowing through PWI’s accounts (these benefits are not expected to flow through until June 2002); and• PWI’s policy of expensing all R&D costs as incurred. PWI’s transition from a predominantly R&D focused company to a commercially driven organisation is evidenced by the new agreements PWI has entered into, or is expecting to enter into, with its shareholders, as set out in Section 7.4.PWI Statement of Financial Position ------------------------------------------------------------ N.E. Renton "Understanding The Stock Exchange Chapter 823 page 157. ------------------------------------------------------------ 1) Where less than 20% of another company is owned, then the shareholding is treated as an investment and credit is taken only for the dividends actually received or receivable. ------------------------------------------------------------ 2) If between 20 and 50 percent is owned then "equity accounting" can be used, meaning that credit can be taken for all the profits, less the proportion belonging to the outside minority shareholders. (if any) ------------------------------------------------------------ 3) If more than 50% is owned, then the company becomes a subsidiary and this latter principle again applies: credit is taken for all the profits, less the proportion belonging to the outside minority shareholders. (if any) ------------------------------------------------------------ http://www.xrefer.com/entry/163281 ------------------------------------------------------------ equity accounting ------------------------------------------------------------ The practice of showing in a company's accounts a share of the undistributed profits of another company in which it holds a share of the equity (usually a share of between 20% and 50%). The share of profit shown by the equity-holding company is usually equal to its share of the equity in the other company. Although none of the profit may actually be paid over, the company has a right to this share of the undistributed profit. ------------------------------------------------------------ [ Next Thread | Previous Thread | Next Message | Previous Message ] |
| Subject | Author | Date |
| Re: The technological benefits of the Proton acquisition ratified 28/11 | anonymous | 15:36:42 11/24/02 Sun |
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