Annual Report 30 June 2007 - One Horizon Group

32
NOTES TO THE FINANCIAL STATEMENTS (continued)
30. Reconciliation of net cash flow to movement in net (debt)/funds
30 June 2007 30 June 2006
$000’s $000’s
Decrease in cash in the year (942) (3,260)
Net cash outflow from other loans 54 2,243
Cash outflow in respect of hire purchase 356 48
Change in net funds resulting from cash flows (532) (969)
New hire purchase (341) –
Movement in net funds in the year (873) (969)
Net funds at 1 July 2006 602 1,571
Net (debt)/funds at 30 June 2007 (271) 602
31. Purchase of World Communication Center, Inc.
30 June 2007
Net assets acquired $000’s
Fixed assets 245
Stocks 299
Debtors 1,210
Cash and bank in hand (244)
Creditors (1,638)
(128)
Goodwill 6,199
Net cash paid 2,039
Shares allotted 2,182
Convertible unsecured loan stock 1,100
Deferred consideration (note 26) 750
32. Financial instruments
The Group faces some risks not all of which are within our control. The main risk factors are outlined as follows:
● Suppliers – The Group purchases its airtime from a few main satellite operators, the majority being from Inmarsat,
Iridium and Thuraya. We are reliant on the operators maintaining their capacity to enable our customers to use
their equipment. The satellite operators have contingency plans to protect their business and we feel the risk is
not significant.
● Foreign Currency – The Group reports its results in US Dollars because the majority of the trading income and
expenditure is in that currency. The Group has some exposure to sterling/US dollar exchange rate due to the fact that
UK head office, AIM costs and some interest costs are payable in sterling. The majority of sterling debt on the balance
sheet has been hedged during the year and going forward to protect the Group from a further reduction in the
US dollar/sterling rate.
6,071
6,071