UNAUDITED INTERIM RESULTS FOR SIX MONTHS ENDED 30 JUNE 2008

Livermore Investments Group Limited (the "Company" or "Livermore") today announces its interim results for the six months ended 30 June 2008. 

SUMMARY    

*including unrealized gains and losses from Income Statement and Changes in Equity

Commenting on the results, Noam Lanir, CEO of Livermore Investments Group Limited, said:  "A well diversified and defensive portfolio has now been established, with primary investment focus on Europe and Asia. The portfolio achieved a stable performance during the first half of 2008, obtaining capital preservation, low volatility and generating stability in the NAV per share in an extremely challenging environment. We continue with our prudent investment approach and maintain a low cost structure and high liquidity position.

We are satisfied with the results achieved in the past 18 months since establishing Livermore as an investment company. We have managed to build a robust portfolio that will generate shareholder value in the mid to long term."

For further investor information please go to www.livermore-inv.com.

  Chairman's and Chief Executive's Review

Introduction

Following the completion of a successful first year as an investment company, the Company faced new challenges and opportunities during the first half of 2008. Unstable financial markets, worldwide recessionary concerns, high volatility in energy, basic material and consumer goods prices, and uncertainty in the real estate industry, all lead the Company to continue its conservative defensive  investment approach. 

The Company holds a few significant value investments which will form the portfolio's cornerstone investments over the mid term. In addition, the Company holds yielding investments, which contribute to its operational cash requirements. 

Investment Environment

The first half of 2008 was an unstable period in the financial markets. Volatility in equity and bond markets around the globe spiked as credit concerns grew and weakening U.S. and global economic indicators spurred regulators to take unprecedented actions to relieve the stress.

The Federal Reserve Board ("The Fed") made a number of unprecedented moves in order to restore confidence in the credit markets and prevent what could be a chain reaction of defaults. The Fed lowered its interest rates to 2% during the period, announced billions of dollars of loan programs for banks to counter declining liquidity, accepted hard-to-sell mortgage-backed securities as collateral, opened the discount window to primary dealers, and engineered a takeover of Bear Stearns by JPMorgan Chase.  

Despite these efforts, the credit crisis continued to present new facets as more financial companies announced losses, inflationary concerns grew and oil prices skyrocketed to levels of $140+ per barrel.  Few market participants were unaffected by the volatility and global economic slowdown.  

The S&P 500 dipped into bear market territory during the period, dropping over 13% from the beginning of the year. However, equity markets in emerging markets that were net importers of commodities, such as China and India, bore the brunt of the pain. The Hang Seng Index and India's NIFTY Index were down over 20% from the beginning of the year, suffering on account of high inflation and concerns over reduced liquidity to finance projected growth.

Overall, general de-leveraging in the global economy coupled with the weakness in the housing market and the overall real estate sector has caused severe uncertainty within the economy and shows little sign of recovery any time soon. The liquidity provided by the financial system is still limited, which in turn does not yet provide pricing support to the housing market. There is a continuous deterioration in pricing across all major asset classes. In light of these market conditions, Livermore expects that some of the anticipated exits from its investments in 2008 will likely be delayed until more favourable global economic conditions return.

Portfolio Performance 

During the reporting period, Livermore's portfolio remained generally stable.  Livermore's portfolio is diversified across various asset classes, geographies, and currencies, and most investments are private equity in nature. The Company did not make any significant exits or realization of its major investments. Since 30 June 2007 the Company has significantly reduced its exposure to public equities. 

The Net Asset Value at 30 June 2008 decreased slightly mainly due to a negative contribution from the equity and fixed income investments. These were offset by revenues from income-yielding investments, gains in private equity funds, currency gains, and revaluation of real estate assets. The NAV per share remained at $0.97 (49 pence per share) at 30 June 2008 (30 June 2007: $0.95 per share/ 47 pence per share, 31 December 2007 $0.97 per share/ 49 pence per share).  There is no material change in the NAV adjusted for dividend payment since the reporting period.

Loss before administration costs and share options amortization, including unrealised gains for the first six months of 2008, was $1.8m, (30 June 2007: $16.2m profit; 31 December 2007: $26.9m profit). Loss before tax for the period was $4.3m (30 June 2007: $11.9m profit; 31 December 2007: $21m profit).  

  The Company's portfolio is distributed amongst the asset classes listed below:

The main shifts in asset classes during the period are attributable to changes in financial/minority holdings and bonds. These changes reflect the use of cash positions for completion of the acquisition of 21% of Atlas Estates Ltd. and for investments in assets and growth companies and private equity funds in the real estate and media sectors. These investments were made in the form of equity and convertible loans, which are included in financial / minority holdings.  The overall liabilities of the company increased during the period by $8.3m. The long term Bank loan related to the acquisition of Wyler Park in Bern Switzerland, given in CHF, increased by $7.7m as a result of exchange rate differences. The increase in the Company's bank overdraft and short term loan facilities of $36.1m relates mainly to the acquisition of Atlas Estates Ltd. booked at 31 December 2007 as "trade and other payables". The short term bank loan, as well as the overdraft facility, is at Libor plus 50bp.  The net change in current liabilities from year end 2007 is $0.6m.

Updates on Significant Investments

Atlas Estates

In December 2007, Livermore had acquired a 21% stake in Atlas Estates Ltd. (also referred to as "Atlas" or "associated company"), a diversified real estate company prominent in Central and Eastern Europe, with prime properties such as the Hilton Warsaw and Platinum Towers in Poland.  

Atlas has continued its strategy of investing in the developing markets of Central and Eastern Europe, which is proving successful. While the economies of Poland, Hungary, Slovakia and Romania have not been immune to the adverse effects of the global economic slowdown, the potential in these economies and real estate sectors remains strong especially for quality residential, retail, and office properties.  

Despite restricted availability of credit in the region, Atlas announced a credit facility of €54m for the construction of its Warsaw Platinum Towers project.  They have also successfully refinanced the Hilton Warsaw and extended the facility on this property from €51.4m to €65m.  

Atlas reported an increase in Adjusted NAV from €6.36 per share in December 2007 to €6.57 per share at 30 June 2008. The book NAV, however, declined slightly from €4.98 per share in December 2007 to €4.89 per share in June 30 2008.  Atlas' loss for the period ended 30 June 2008 was €3.9m.

Atlas has a solid underlying portfolio with low levels of financial gearing and Livermore believes that Atlas is well positioned to weather the current market turmoil.

Being an associated company, Atlas is presented in Livermore's balance sheet at book NAV, and Livermore assumes proportional profit / loss on its Income Statement.  

SRS Charminar

As noted in our 2007 Annual Report, Livermore has invested in a leading Indian real estate company, in association with SRS Private and other investors. The target company is a top real estate player in Southern India, with a land bank of over $1.3bn spread across the city of Hyderabad and the state of Andhra Pradesh.

Our exit from this investment is expected to be via an IPO within 36 months of the date of investment. Investors are guaranteed a minimum of 12.5% discount on the IPO price. The deal structure includes a put option for investors, which can be exercised if the IPO does not take place within 3 years. The put option is secured by land valued at $1.3bn and guarantees a minimum return of approximately 30% IRR if exercised.

The real estate sector in India is showing signs of weakness in some segments due to high interest rates and negative consumer sentiment arising from rising inflation, high oil prices, and political uncertainty.  Reduced liquidity in the market has resulted in lower volumes and price corrections across most markets. However, the long term fundamentals of the Indian real estate sector are still intact. There continues to be strong demand at mid-market price points and in the affordable housing sector which have historically been under-served. 

The target company is building its presence in new cities and strengthening it in existing bases in southern India. Further it has also entered into two new business segments - Affordable Housing and Warehousing. 

DTH-BOOM TV ("Boom")

Livermore invested in Boom in October 2007, acquiring a 15% minority stake for approximately €9.5m. As of 30 June 2008 Livermore holds 16.4% of Boom, after further investments were made during the year. Boom is a Direct-To-Home multi channel satellite television service in Romania which commenced operations during the third quarter of 2006. It is well positioned in the Romanian media market and enjoys superiority in technology, innovation and content. 

Since Livermore's investment, Boom has met operational and financial targets. As at 30 June 2008, Boom had over 170,000 subscribers (versus 107,000 as at 31 December 2007). Boom aims to reach positive EBITDA during 2009 and to make significant profits after this point. 

Livermore expects initial realization of the investment to occur in 2009-2010. 

Wyler Park

Wyler Park is the Group's first real estate investment in Switzerland. It is a purchase and leaseback deal for SBB's (the Swiss national railway company) headquarters in Bern, Switzerland. The property, which consists of two office buildings - was purchased for CHF 93m through a newly established Swiss special purchase vehicle with an 85% Loan to Value loan facilitated by Merrill Lynch. Construction of 39 luxury apartments on top of one of the commercial buildings was concluded on time and budget in July 2008 at a cost of approximately CHF 15m. The first apartments were rented to tenants during August 2008. Additional development rights will be utilized in the future.

During the first half of 2008, the Wyler Park property contributed some $1.7m to the Group's profit before tax, derived from operating income, and exchange rate benefits resulting from the appreciation of the CHF against the dollar. 

Following completion of the residential part, the Company is in the process of renting out the apartments. Thereafter, the Company foresees additional rental income of over CHF 1m.

Repurchase of shares

Between the period ending 31 December 2007 and 30 June 2008, the Company repurchased 2,372,677 shares for an average price of $0.626 per share. An additional 285,924 shares were purchased between 30 June 2008 and 17 July 2008. As at 18 September 2008, the Company holds 11,408,601 shares in treasury.

Further share buy backs will be considered in light of both the discount to the net asset value and management's strategic view of the investment portfolio.

Dividends

The final dividend for 2007 of $0.035 per share, totalling $9.8m, was paid on 29 August 2007 in the form of cash ($4.1m) and a scrip dividend alternative. As a result of the scrip dividend offer, 11,342,629 new ordinary shares were issued and admitted to trading on AIM on 29 August 2008. 

The Board of Directors will decide on the Company's dividend policy for 2008 based on market conditions and portfolio performance over the current financial year. 

Richard Rosenberg   Noam Lanir

Chairman   Chief Executive

17 September 2008

  Livermore Investment Group Limited 

Consolidated Income Statement

for the Six months ended 30 June 2008

  Livermore Investments Group Limited 

Consolidated Balance Sheet 

as at 30 June 2008

  Livermore Investments Group Limited 

Consolidated Statement of Changes in Equity

for the period ended 30 June 2008

  Livermore Investments Group Limited 

Consolidated Cash Flow Statement   

for the period ended 30 June 2008

Notes to the Financial Statements

1.    Accounting policies 

The interim financial statements of Livermore have been prepared on the basis of the accounting policies and basis of consolidation stated in the 2007 Annual Report, available on www.livermore-inv.com. The financial information has been prepared in accordance with IAS 34 "Interim Financial Reporting".

Basis of preparation

These results have been prepared on the basis of the accounting policies expected to be adopted in the Company's full year financial statements, which are expected to be prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union. There are no material differences between the accounting policies set out in the financial statements for the year ended 31 December 2007 and the accounting policies the Company expects to adopt in the next financial year's statements.  

The financial information for the period ended 30 June 2007 is extracted from the Company's financial statements for the year ended 31 December 2007 which contained an unqualified audit report.

2.    Segment information

Management consider investment activity to be a single class of business.  

3.    Interest / dividend income

4.    Investment property revenue

  5.    (Losses) / gain on investments

6.    Share of (loss) / profit of associate

The investment in associate forms part of the Company's investment portfolio and therefore has been included within the investment income.  

7.    Amortisation and non recurring items

Amortisation and non-recurring items refer to:

8.    Dividends

The Board of Directors will decide on the Company's dividend policy for 2008 based on market conditions and portfolio performance over the current financial year.  

  9.    Earnings per share

Basic earnings per share has been calculated by dividing the net (loss) / profit attributable to ordinary shareholders ((loss) / profit for the year) by the weighted average number of shares in issue during the relevant financial periods.  

Diluted earnings per share is calculated after taking into consideration the potentially dilutive shares in existence during the period.

10.    Available-for-sale financial assets*

* Financial assets relate to investments in bonds and equities classified as available for sale. Financial assets are held in the balance sheet at the period end at fair value. Fair value is measured by reference to the market value of the assets at the balance sheet date as they are openly traded on a public market, or as valued by the relevant asset manager using common industry valuation tools.

** Financial and minority holdings relate to significant investments (of over $5m) which are strategic for the Company and are done on the form of equity purchase or convertible loans. Main investments under this category are in the fields of real estate and media.

11.    Financial assets designated at fair value through profit and loss 

12. Investment and development property

A real estate investment property - Wyler Park - in Bern, Switzerland was purchased on 1 July 2007.  Valuation of the property was conducted in March 2008. An additional valuation of the commercial property was performed at 30 June 2008, following which the property valuation was updated mainly due to consumer price index related changes. Development property for the interim remains at cost as it was not completed. 

Comparative Period

13.    Investment in associate

Investment in associate- The Company has 22.10% interest in Atlas Estates Limited, an AIM quoted real estate investment and development company.

The following table illustrates summarised financial information of the group's investment in Atlas Estates Ltd:  

  14.    Cash and cash equivalents

Cash and cash equivalents included in the cash flow statement comprise the following at the balance sheet date:

15.    Share Capital 

The Company had an issued share capital of 292,777,772 ordinary shares of no par value at its IPO on 15 June 2005.  During 2007 the Company purchased 8,750,000 ordinary shares at a price of $0.820 (£0.407) per share to be held in treasury.  During the period January to June 2008 the Company purchased additional 2,372,677 ordinary shares at a price of $0.626 (£0.314) per share to be held in treasury, and until 17 July 2008 another 285,924.  On 30 June 2008 the Company held 11,122,677 shares in treasury, and on 17 September 2008, 11,408,601 were held in treasury.  

The Company has 11,340,000 outstanding share options at the end of the period of which 500,000 were granted on 13 May 2008.  Options are normally exercisable in three equal tranches, on the first, second and third anniversary of the grant. There have been no changes to the term of the options in issue during the period.  

16.    Related party transactions

• These payments were made in respect of members of key management either directly to them or to companies to which they are related. 

Tradal Ltd. is a related party by virtue of common ownership with Livermore Investments Group Ltd.

Loans of $ 5,500,000 were made to key management during 2007 for the acquisition of shares in the Company. Interest is payable on these loans at US LIBOR plus 0.25% and the loans are secured on the shares acquired. The loans are repayable on the earlier of the employee leaving the Company or November 2010.  

17.    Litigation    

The litigation procedure previously reported with a former employee of Empire Online Limited (the Company's previous name) is still in process. In the first half of 2008, positive progress was made in favour of the Company relating to this litigation, and the Company is now confident with its success in the process. Regardless, the Company expects that final resolution will not be achieved in the near future. 

18.    Post balance sheet events

On 28 August 2008 the Company paid its 2007 dividend in the equivalent amount of $9.848m. The dividend was paid in the form of cash and scrip shares. The total cash payment in respect of the dividend amounted to $4.155m, and the Company issued 11,342,629 additional ordinary shares to shareholders that elected to receive the scrip dividend alternative.  The total number of ordinary shares in issue as at 17 September, 2008 is 304,120,401, of which 11,408,601 are held in treasury. 

19.    Preparation of interim statements 

The financial information does not constitute statutory accounts within the meaning of the BVI International Business Companies Act 1984 (as amended). Financial Statements for Livermore Investments Group Limited for the year ended 31 December 2007, prepared in accordance with International Financial Reporting Standards as adopted by the European Union, on which the auditors gave an unqualified audit report are available from the Company's website www.livermore-inv.com 

  Independent review report to Livermore Investments Group Limited

Introduction

We have been engaged by the Company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2008 which comprises the consolidated income statement, the consolidated balance sheet, the consolidated statement of changes in equity, the consolidated cash flow statement and notes 1 to 19. We have read the other information contained in the half yearly financial report which comprises only the Summary and the Chairman's and Chief Executive's Review and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements. 

This report is made solely to the Company in accordance with guidance contained in ISRE (UK and Ireland) 2410, 'Review of Interim Financial Information performed by the Independent Auditor of the Entity'. Our review work has been undertaken so that we might state to the Company those matters we are required to state to them in a review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company, for our review work, for this report, or for the conclusion we have formed.

Directors' responsibilities 

The half-yearly financial report is the responsibility of, and has been approved by, the directors. 

As disclosed in Note 1, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34, 'Interim Financial Reporting,' as adopted by the European Union. 

Our responsibility 

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review. 

Scope of review 

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. 

Conclusion 

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2008 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union. 

GRANT THORNTON UK LLP
AUDITOR

LONDON
17 SEPTEMBER 2008