RNS Number:3129Q
London Security PLC
30 September 2003
London Security plc
Interim Results for the six months ended 30 June 2003
Chairman's Statement
Financial highlights of the results for the six months ended 30 June 2003
compared with the first half of 2002 are as follows:
* Turnover increased by 9% to #26.7million
* Operating profit increased by 3% to #5.4million
* EBITDA increased by 4% to #7.6million
* Net gearing reduced from 10% at 31 December 2002 to 3%
* Interim dividend increased by 50% to 3.0p
Review
Six months to 30 June
2003 2002 2001 2000
#million #million #million #million
Turnover 26.7 24.5 22.2 19.0
Operating Profit 5.4 5.2 4.2 2.4
EBITDA 7.6 7.3 6.3 4.6
The results for the first six months of 2003 have been satisfactory despite the
challenging market conditions. These results have benefited from the positive
impact of the companies acquired in 2002 (Asco, CFP Cavelle and HUG) and
exchange rate movements which have also impacted favourably.
More importantly we report that the integration of Asco into the Group is on
plan both operationally and financially. The cost base has been reduced in 2003
through better purchasing of our raw materials and this is expected to impact on
the profit and loss account in the second half of the year. The Group is also
actively developing new improved ranges of extinguishers and plans to launch
these products in the New Year are on schedule.
The company has obtained ISO 14001 certification in line with our previously
stated environmental policy.
As the table above illustrates, the Group has enjoyed sustained growth since
2000. Operating profit at 20% of turnover and EBITDA at 28% of turnover are
exceptional results and far greater than those enjoyed by our competitors.
These figures illustrate our ability to manage service businesses and, as such,
it remains a principal aim of the Group to acquire companies in the fire and
security sectors to complement and build upon the organic growth demonstrated in
recent times.
In this period, the management and staff have continued to perform well and I
would like to express thanks and appreciation for their contribution.
Dividends
An interim dividend of 3.0p (2002: 2.0p) per ordinary share is proposed, payable
on 12 November 2003 to shareholders on the register as at 10 October 2003.
Prospects
The outlook for the second half of 2003 is cautiously optimistic.
J. G. Murray
Chairman
30 September 2003
Unaudited Unaudited Audited
6 months 6 months year ended
to 30 June to 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Turnover 26,695 24,520 48,078
Cost of sales (4,219) (3,723) (7,288)
Gross profit 22,476 20,797 40,790
Distribution costs (9,942) (8,893) (18,079)
Administrative expenses (7,172) (6,679) (13,433)
Operating profit 5,362 5,225 9,278
EBITDA** 7,638 7,319 13,694
Depreciation (864) (780) (1,735)
Amortisation of goodwill (1,412) (1,314) (2,681)
Operating profit 5,362 5,225 9,278
Income from fixed asset investments 118 109 111
Net interest payable and others (414) (577) (946)
Profit on ordinary activities before 5,066 4,757 8,443
taxation
Taxation (2,023) (2,076) (3,840)
Profit on ordinary activities after taxation 3,043 2,681 4,603
Dividends (434) (290) (1,014)
Retained profit 2,609 2,391 3,589
Basic earnings per ordinary share 21.0p 18.5p 31.8p
Adjusted earnings per ordinary share (note 2) 30.8p 27.6p 50.3p
Dividend per ordinary share 3.0p 2.0p 7.0p
All of the above results arose from continuing operations
** Earnings Before Interest, Taxation, Depreciation and Amortisation
Unaudited Unaudited Audited
as at as at as at
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Fixed assets
Intangible assets 46,044 46,576 47,128
Tangible assets 7,684 6,807 7,363
Investments 70 70 70
53,798 53,453 54,561
Current assets
Stocks 3,821 3,284 3,425
Debtors 11,408 10,504 9,740
Cash at bank and in hand 12,296 11,253 10,303
27,525 25,041 23,468
Creditors: due within one year
Finance debt (3,781) (3,179) (3,503)
Other creditors (14,682) (15,461) (13,383)
(18,463) (18,640) (16,886)
Net current assets 9,062 6,401 6,582
Total assets less current liabilities 62,860 59,854 61,143
Creditors: due after more than one year
Finance debt (10,158) (11,864) (11,255)
Provisions for liabilities and charges (1,761) (1,755) (1,907)
(11,919) (13,619) (13,162)
Net assets 50,941 46,235 47,981
Capital and reserves
Called up share capital 1,449 1,449 1,449
Share premium 27,476 27,476 27,476
Capital redemption reserve 115 115 115
Merger reserve 2,033 2,033 2,033
Profit and loss account 19,868 15,162 16,908
Total equity shareholders' funds 50,941 46,235 47,981
Unaudited Unaudited Audited
6 months 6 months year ended
to 30 June to 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Net cash inflow from operating 7,505 8,084 14,980
activities
Return on investments and servicing of finance
Interest received 80 78 204
Interest paid (379) (522) (889)
Dividends received 118 109 111
Net cash outflow from return on investments
and servicing of finance (181) (335) (574)
Taxation
Corporation tax paid (1,700) (769) (4,034)
Capital expenditure
Payments to acquire intangible fixed (190) - (52)
assets
Payments to acquire tangible fixed (1,137) (1,402) (3,343)
assets
Receipts from sales of tangible fixed 165 88 845
assets
Net cash outflow for capital expenditure (1,162) (1,314) (2,550)
Acquisitions and disposals
Payments to acquire subsidiary undertakings - (66) (2,714)
Cash acquired with subsidiary undertakings - - 331
Net cash outflow for acquisitions - (66) (2,383)
Equity dividends paid to shareholders (724) (44) (870)
Net cash inflow before use of liquid resources
and financing 3,738 5,556 4,569
Financing
Purchase of own shares (171) - -
New long term loans 237 - 1,350
Repayment of long term loans (1,811) (1,595) (2,908)
Net cash outflow from financing (1,745) (1,595) (1,558)
Increase in cash and equivalents 1,993 3,961 3,011
1. Nature of Information
The financial information contained in this interim statement does not
constitute statutory accounts within the meaning of section 240 of the Companies
Act 1985. The financial information for the six months ended 30 June 2003 is
unaudited and has been prepared on the basis of the accounting policies set out
in the Group's 2002 Report and Accounts. Statutory accounts for the year ended
31 December 2002 have been delivered to the Registrar of Companies. The report
of the auditors on those accounts was unqualified and did not contain a
statement under sections 237(2) or 237(3) of the Companies Act 1985.
2. Earnings per Share
The calculation of basic earnings per ordinary share is based on the profit on
ordinary activities after taxation of #3,043,000 (2002: #2,681,000) and on
14,485,232 (2002: 14,487,316) ordinary shares, being the weighted average number
of ordinary shares in issue during the period.
The calculation of adjusted earnings per ordinary share is based on the above
weighted average and on adjusted earnings which comprise:
Six months Six months Year ended
to 30 June to 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Profit on ordinary activities after 3,043 2,681 4,603
taxation
Eliminate effect of:
Amortisation of goodwill 1,412 1,314 2,681
Adjusted earnings 4,455 3,995 7,284
Basic earnings per ordinary share 21.0p 18.5p 31.8p
Adjusted earnings per ordinary share 30.8p 27.6p 50.3p
3. Taxation
The taxation charge for the period (39.9%) appears high due principally to the
non-deductibility for taxation purposes of the amortisation of goodwill.
4. Profit and Loss Account
Profit and Loss
Account
#'000
As at 1 January 2003 16,908
Retained profit for the period 2,609
Exchange adjustments 522
Purchase of own shares (171)
As at 30 June 2003 19,868
This information is provided by RNS
The company news service from the London Stock Exchange
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