U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): May 10, 2007
Berkeley Technology Limited
(Exact Name of Registrant as Specified in its Articles)
----------------------
0-21874
(Commission File Number)
Jersey (Channel Islands) U.K. Not applicable
(State or Other Jurisdiction (I.R.S. Employer Identification No.)
of Incorporation)
Minden House
6 Minden Place
St. Helier
Jersey
Channel Islands
JE2 4WQ
Tel: 011 44 1534 607700
(Address and telephone of Principal Executive Offices)
N/A
(Former Name or Address, if Changed Since Last Report)
The following information is furnished pursuant to this
Item 7.01,"Regulation FD Disclosure" and Item 2.02, " Results of Operations and
Financial Condition."
FOR IMMEDIATE RELEASE May 10, 2007
Berkeley Technology Limited
Financial Results
For the Quarter Ended
March 31, 2007
London, May 10, 2007 - Berkeley Technology Limited (OTCBB: BKLYY.PK, London:
BEK.L) (the "Company") is an international venture capital and consulting firm,
primarily in the telecommunications and medical industries. The Company
represents Silicon Valley and other telecommunications equipment companies in
dealing with large incumbent European and Japanese telecommunications companies.
Our intention is to continue operating the Company to maximize shareholder
value. We are an operating company and intend to generate value through our
successful efforts over time.
The Company today reported financial results for its fiscal quarter ended March
31, 2007. The Company's consolidated net income, computed in accordance with
U.S. generally accepted accounting principles ("U.S. GAAP") for the first
quarter of 2007, was $0.7 million, or $0.01 per diluted share and $0.13 per
diluted ADR, compared with a loss of $(0.7) million, or $(0.01) per diluted
share and $(0.14) per diluted ADR, for the same period in 2006.
A $1.2 million payment representing a partial distribution resulting from the
settlements achieved in the WorldCom, Inc. securities litigation primarily
contributed to the net income for the quarter. LPAL held certain WorldCom, Inc.
publicly traded bonds which it sold at a loss in 2002. The $1.2 million payment
has been recognized in the first quarter of 2007 in the Company's consolidated
statement of operations as a realized gain, which reverses part of the realized
loss recorded in 2002. The Company expects to receive an additional $0.4 million
as a final distribution later in 2007. Since these payments are for LPAL's
account, they are not available to fund the operations or commitments of the
Company or its other subsidiaries.
A decline in operating expenses of $0.2 million and an increase in consulting
fee income of $0.1 million also contributed toward the net income for the
quarter. The impact of stock market volatility on the Company's results has been
negligible following the sale of most of its common stock holdings during 2004
and early in 2005. London Pacific Assurance Limited ("LPAL"), the Company's
Jersey, Channel Islands based insurance company, continued to serve its
policyholders; however, no new policies are currently being sold. Policyholder
liabilities for LPAL fell during the first quarter of 2007 by $1.7 million to
$2.0 million primarily due to maturing policies.
*****
Statements contained herein which are not historical facts are forward-looking
statements that involve a number of risks and uncertainties that could cause the
actual results of the future events described in such forward-looking statements
to differ materially from those anticipated in such forward-looking statements.
Factors that could cause or contribute to deviations from the forward-looking
statements include, but are not limited to, (i) variations in demand for the
Company's products and services, (ii) the success of the Company's new products
and services, (iii) significant changes in net cash flows in or out of the
Company's businesses, (iv) fluctuations
in the performance of debt and equity markets worldwide, (v) the enactment of
adverse state, federal or foreign regulation or changes in government policy or
regulation (including accounting standards) affecting the Company's operations,
(vi) the effect of economic conditions and interest rates in the U.S., the U.K.
or internationally, (vii) the ability of the Company's subsidiaries to compete
in their respective businesses, (viii) the ability of the Company to attract and
retain key personnel, and (ix) actions by governmental authorities that regulate
the Company's businesses, including insurance commissions. The Company
undertakes no obligation to update any forward-looking statements, whether as a
result of new information, future developments or otherwise.
Please address any inquiries to:
Ian Whitehead Jersey (0)1534 607700
Chief Financial Officer
Berkeley Technology Limited
Form 10-Q for the quarter ended March 31, 2007
A copy of the above document will be submitted to the U.K. Listing Authority and
will be shortly available for inspection at the U.K. Listing Authority's
Document Viewing Facility, which is situated at:
Financial Services Authority
25 The North Colonnade
Canary Wharf
London
E14 5HS
Tel: 020 7676 1000
Berkeley Technology Limited
Condensed Consolidated Statements of Operations
Under U.S. GAAP (unaudited)
In thousands, except per share and ADR amounts
Three Months Ended
March 31,
..............................
2007 2006
............. .............
Revenues:
Investment income $ 231 $ 354
Consulting and other fee income 205 154
Net realized investment gains 1,198 -
Change in net unrealized investment gains and losses on
trading securities - 57
............. .............
1,634 565
Expenses:
Amounts credited on insurance policyholder accounts 30 170
Operating expenses 924 1,116
............. .............
954 1,286
............. .............
Income (loss) before income tax expense 680 (721)
Income tax expense 2 5
............. .............
Net income (loss) $ 678 $ (726)
............. .............
............. .............
Basic and diluted earnings (loss) per share $ 0.01 $ (0. 01)
............. .............
............. .............
Basic and diluted earnings (loss) per ADR $ 0.13 $ (0. 14)
............. .............
............. .............
Berkeley Technology Limited
Condensed Consolidated Balance Sheets
Under U.S. GAAP (unaudited)
In thousands, except share amounts
March 31, December 31,
2007 2006
............. .............
ASSETS
Investments (principally of life insurance subsidiary):
Fixed maturities:
Available-for-sale, at fair value (amortized cost: $6,005 and $9,021
as of March 31, 2007 and December 31, 2006, respectively) $ 6,000 $ 9,007
Held-to-maturity, at amortized cost (fair value: $2,000 and $3,004
as of March 31, 2007 and December 31, 2006, respectively) 2,002 3,009
Equity securities:
Available-for-sale, at estimated fair value (cost: $844 as of
March 31, 2007 and December 31, 2006) 844 844
............. .............
Total investments 8,846 (1) 12,860
Cash and cash equivalents 9,670 (1) 6,707
Accrued investment income 329 304
Other assets 359 366
............. .............
Total assets $ 19,204 $ 20,237
............. .............
............. .............
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Life insurance policy liabilities $ 1,967 $ 3,640
Accounts payable and accruals 623 674
............. .............
Total liabilities 2,590 4,314
............. .............
Commitments and contingencies
Shareholders' equity:
Ordinary shares, $0.05 par value per share: 86,400,000 shares authorized;
64,439,073 shares issued and outstanding as of March 31, 2007
and December 31, 2006 3,222 3,222
Additional paid-in capital 67,723 67,718
Retained earnings 8,677 7,999
Employee benefit trusts, at cost (13,522,381 shares as of
March 31, 2007 and December 31, 2006) (62,598) (62,598)
Accumulated other comprehensive loss (410) (418)
............. .............
Total shareholders' equity 16,614 15,923
............. .............
Total liabilities and shareholders' equity $ 19,204 $ 20,237
............. .............
............. .............
<FN>
(1) Includes $6,844 of investments and $6,856 of cash and cash equivalents in the Company's insurance
subsidiary (LPAL) which are not currently available to fund the operations or commitments of the
Company or its other subsidiaries.
</FN>
Berkeley Technology Limited
Condensed Consolidated Statements of Cash Flows
Under U.S. GAAP (unaudited)
In thousands
Three Months Ended
March 31,
..............................
2007 2006
............. .............
Net cash used in operating activities $ (532) $ (592)
Cash flows from investing activities:
Purchases of held-to-maturity fixed maturity securities - (3,035)
Purchases of available-for-sale fixed maturity securities - (9,082)
Proceeds from maturity of held-to-maturity fixed maturity securities 1,000 7,000
Proceeds from sale and maturity of available-for-sale fixed maturity 3,000 6,575
securities
Partial proceeds from WorldCom, Inc. securities litigation settlement 1,198 -
............. .............
Net cash provided by investing activities 5,198 1,458
............. .............
Cash flows from financing activities:
Insurance policyholder benefits paid (1,703) (2,710)
............. .............
Net cash used in financing activities (1,703) (2,710)
............. .............
Net increase (decrease) in cash and cash equivalents 2,963 (1,844)
Cash and cash equivalents at beginning of period 6,707 10,039
Foreign currency translation adjustment - 21
............. .............
Cash and cash equivalents at end of period (1), (2) $ 9,670 $ 8,216
............. .............
............. .............
<FN>
(1) Does not include $1,036 of cash held in escrow as of March 31, 2006.
(2) The amount for March 31, 2007 includes $6,856 in the Company's insurance subsidiary (LPAL) which is
not currently available to fund the operations or commitments of the Company or its other subsidiaries.
</FN>