RNS Number:1495Q
Fulmar PLC
25 September 2003
FULMAR plc - INTERIM ANNOUNCEMENT
Fulmar, the South London-based commercial and book printer, announces another
commendable result achieved despite a lack of any improvement in the market for
commercial printing, the Group's principal business.
Half year ended 30 June 2003 2002 Change
Turnover (#m) 20.75 20.55 +1%
Pre-tax profit: pre-exceptional (#m) 1.75 1.80 -3%
reported (#m) 1.75 0.87 +101%
Earnings per share: pre-exceptional (p) 4.3 4.5 -3%
reported (p) 4.3 2.2 +101%
Dividend per share (p) 1.8 1.8 -
Net assets per share (p) 88.2 85.7 +3%
* Group turnover increased to #20.75m despite a 4% reduction in turnover
in commercial printing to #13.85m caused by pricing pressures.
* The book cover and jacket and paperback book printing operations
continue to perform well, increasing turnover by 20% to #5.94m (29% of Group
turnover).
* Mike Taylor, Chief Executive, stated "Our commercial printing
businesses remain the major part of our Group and they continue to operate in a
weak market, resulting in price pressures. However, these businesses are
efficient and well invested, and will benefit when an upturn in economic
activity materialises, with commercial printing historically being early into
and out of recession. Our book operations are becoming increasingly important to
the Group, accounting for almost one-third of turnover, and these businesses
continue to experience healthy demand for their services."
Enquiries:
Fulmar plc 020-8688 7500
Mike Taylor (Chief Executive)
Derek Harris (Finance Director)
Bankside Consultants Limited
Charles Ponsonby 020-7444 4166
Alistair MacDonald 020-7444 4168
INTERIM STATEMENT
With no sign of any improvement in the market for commercial printing, the
results for the half year reflect considerable credit on our Group.
Financial Review
The figures in this paragraph disregard the #0.93m exceptional debit in 2002. On
turnover up 1% at #20.75m (2002: #20.55m), operating profit was 5% down at
#2.09m (2002: #2.19m), representing an operating margin of 10.1%. Pre-tax profit
decreased by 3% to #1.75m (2002: #1.80m), representing a pre-tax margin of 8.4%.
Earnings per share were 3% lower at 4.3p (2002: 4.5p).
On a reported basis, operating profit increased by 33%, pre-tax profit by 101%
and earnings per share by 101%.
Equity shareholders' funds were #24.45m compared with year end 2002 of #23.75m,
giving net assets per share of 88.2p (2002: 85.7p).
The Group's half year end net indebtedness reduced to #14.18m (December 2002:
#16.73m) with a resultant gearing of 58% (2002: 70%), reflecting the reduced
capital expenditure at #2.38m. The net interest charge of #0.33m (2002: #0.39m)
was covered 6.2 times (2002: 5.7 times before exceptional items) by operating
profit.
OPERATING REVIEW
Commercial and Financial Printing
Our commercial printing operations represent 67% of the Group's turnover and
principally relate to marketing literature, corporate brochures, annual reports
and City financial documents. As a result of the price pressure in this market,
turnover for our commercial printing businesses reduced by 4% to #13.85m.
Fulmar Colour, our broadly-based commercial printer, took delivery of its second
12 colour Heidelberg press, increasing the company's ability to respond to the
demand for both rapid turnaround and competitive pricing that has become a
regular feature of clients' requirements, without any loss of quality. Fulmar
Colour has continued its success in the quality awards by winning the Printing
World "Brochures and Catalogues" category.
Royle Corporate Print remains the Group's largest commercial printing operation,
specialising mainly in the production of Annual Reports. It, too, was successful
in the Printing World awards, winning the coveted "Print of the Year" for
overall excellence together with the "Stochastic Screening award" and highly
commended in the "Report and Accounts" category.
Quadracolor, the commercial printer acquired in February 2002, has settled into
the Group well, benefiting from lower group prices for many of its major
purchases, and continues to trade satisfactorily.
Royle Financial Print continues to suffer from the lack of activity in City
financial markets, with a fall of 16% in turnover during the first half.
Book Printing
The Group's book cover and jacket and paperback book printing operations, which
account for 29% of the Group's turnover, continue to perform well, increasing
turnover by 20%.
White Quill Press, the Group's book jacket and cover printer, increased turnover
by 10% during the first half year. This additional demand is being accommodated
by the expansion of the 24 hour working introduced in March 2002. During June
2003, a 767sq m (8,300sq ft) factory extension was commissioned at a build cost
of #0.8m to accommodate the anticipated continuing growth in demand for White
Quill's services. In the last five years turnover has increased by 76%, putting
considerable pressure on the available space. Construction is planned for
completion in December 2003.
Bookmarque, our paperback book printing facility, has continued its high growth
rate, increasing turnover by 39%. Additional shift work in all areas of book
production has been introduced to satisfy the increased demand.
DIVIDENDS
Your Board is declaring an unchanged interim dividend of 1.8p per share, payable
on 10 November 2003 to those shareholders on the register at the close of
business on 10 October 2003.
PROSPECTS
Our commercial printing businesses remain the major part of our Group and they
continue to operate in a weak market, resulting in price pressures. However,
these businesses are efficient and well invested, and will benefit when an
upturn in economic activity materialises, with commercial printing historically
being early into and out of recession.
Our book operations are becoming increasingly important to the Group, accounting
for almost one-third of turnover, and these businesses continue to experience
healthy demand for their services.
Mike Taylor
Chief Executive 25 September 2003
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE SIX MONTHS ENDED 30 JUNE 2003
Six months to Six months to Year ended
30 June 2003 30 June 2002 31 Dec 2002
#000 #000 #000
Turnover 20,751 20,554 41,584
========== ========== =========
Operating profit
Before exceptional items 2,087 2,193 3,848
Exceptional items - (626) (753)
---------- ---------- ---------
2,087 1,567 3,095
Loss on disposal and closure of - (32) (32)
subsidiaries
Loss on sale of fixed assets - (275) (281)
---------- ---------- ---------
Profit on ordinary activities 2,087 1,260 2,782
before interest
Interest receivable 45 5 5
Interest payable (379) (393) (841)
---------- ---------- ---------
Profit on ordinary activities 1,753 872 1,946
before taxation
Tax on profit on ordinary (552) (275) (661)
activities ---------- ---------- ---------
Profit on ordinary activities 1,201 597 1,285
after taxation
Dividends (499) (499) (1,441)
---------- ---------- ---------
Retained profit/(loss) for the 702 98 (156)
period ========== ========== =========
Earnings per share 4.3p 2.2p 4.6p
Dividend per share 1.8p 1.8p 5.2p
CONSOLIDATED BALANCE SHEET
AS AT 30 JUNE 2003
30 June 2003 30 June 2002 31 Dec 2002
#000 #000 #000
Fixed assets
Tangible assets 35,497 35,685 34,857
--------- --------- ---------
Current assets
Stocks 1,957 2,234 1,908
Debtors 12,498 15,791 14,875
Cash at bank and in hand 872 2,004 6
--------- --------- ---------
15,327 20,029 16,789
Creditors: amounts falling due
within one year (11,108) (16,139) (11,757)
--------- --------- ---------
Net current assets 4,219 3,890 5,032
--------- --------- ---------
Total assets less current 39,716 39,575 39,889
liabilities
Creditors: amounts falling due
after more than one year (11,431) (12,024) (12,376)
Provisions for liabilities and (3,836) (3,540) (3,766)
charges --------- --------- ---------
24,449 24,011 23,747
========= ========= =========
Equity shareholders' funds 24,449 24,011 23,747
========= ========= =========
MOVEMENT IN EQUITY SHAREHOLDERS' FUNDS
Called up Share Capital Profit
share premium redemption and loss Year ended
capital account reserve account Total 31 Dec 2002
#000 #000 #000 #000 #000 #000
At 1 1,385 17,921 188 4,253 23,747 23,903
January
2003
Profit for - - - 1,201 1,201 1,285
the
period
Dividends - - - (499) (499) (1,441)
-------- -------- -------- -------- -------- --------
At 30 June 1,385 17,921 188 4,955 24,449 23,747
2003
======== ======== ======== ======== ======== ========
CONSOLIDATED CASH FLOW STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2003
Six months to Six months to Year ended
30 June 2003 30 June 2002 31 Dec 2002
#000 #000 #000
Net cash inflow from operating 4,221 2,384 5,899
activities -------- -------- --------
Returns on investment and
servicing of finance
Interest received 45 5 5
Interest paid (202) (219) (476)
Interest element of finance (177) (174) (365)
lease and hire purchase -------- -------- --------
rentals
(334) (388) (836)
-------- -------- --------
Taxation paid (154) (52) (388)
-------- -------- --------
Capital expenditure
Purchase of tangible fixed (640) (672) (1,457)
assets
Sale of tangible fixed assets 2,136 490 635
-------- -------- --------
1,496 (182) (822)
-------- -------- --------
Acquisitions and disposals
Purchase of subsidiaries - (86) (1,985)
Overdraft acquired with - (104) (104)
subsidiaries -------- -------- --------
- (190) (2,089)
-------- -------- --------
Equity dividends paid (942) (942) (1,441)
-------- -------- --------
Cash inflow before financing 4,287 630 323
-------- -------- --------
Financing
New secured loans 270 4,000 6,140
Repayment of secured loans (1,653) (1,138) (1,739)
Capital element of finance (1,496) (1,157) (2,901)
lease and hire purchase -------- -------- --------
rentals
(2,879) 1,705 1,500
-------- -------- --------
Increase in cash 1,408 2,335 1,823
======== ======== ========
NOTES
1. This interim statement, which has been neither audited nor reviewed and does
not comprise statutory accounts within the meaning of section 240 of the
Companies Act 1985, has been prepared on the basis of the accounting
policies set out in the Group's 2002 statutory accounts.
The 30 June 2002 and 30 June 2003 figures are unaudited. The 31 December
2002 figures are based on, and extracted from, the audited statutory
accounts.
2. The statutory accounts for the year ended 31 December 2002, which received an
unqualified auditors' report and did not contain a statement under section
237(2) or 237(3) of the Companies Act 1985, have been delivered to the
Registrar of Companies.
3. The reconciliation of operating profit to net cash inflow from operating
activities is as follows:
Six months to Six months to Year ended
30 June 2003 30 June 2002 31 Dec 2002
#000 #000 #000
Operating profit 2,087 1,567 3,095
Exceptional closure costs - (25) (32)
Depreciation charges 1,651 1,349 2,924
Increase in stocks (49) (521) (195)
Decrease/(increase) in 325 (1,257) 134
debtors
Increase/(decrease) in 207 1,271 (27)
creditors
---------- ---------- ----------
Net cash inflow from 4,221 2,384 5,899
operating activities
============= ======== =========
4. The reconciliation of net cash flow to movement in net debt is as follows:
Six months to Six months to Year ended
30 June 2003 30 June 2002 31 Dec 2002
#000 #000 #000
Increase in cash 1,408 2,335 1,823
Cash outflow/(inflow) from debt 2,879 (1,705) (1,500)
and lease financing
----------- ---------- ---------
Change in net debt resulting 4,287 630 323
from cash flows
Loans and finance leases - (1,136) (1,136)
acquired with subsidiaries
New finance leases (1,735) (1,960) (2,649)
Issue of short term unsecured - (2,000) -
loan notes
----------- ---------- ---------
Movement in net debt in the 2,552 (4,466) (3,462)
period
Opening net debt (16,731) (13,269) (13,269)
----------- ---------- ---------
Closing net debt (14,179) (17,735) (16,731)
=========== ========== =========
5. The exceptional item in 2002 relates to the relocation and reorganisation of
W E Baxter Limited, and the closure of Lasercraft (UK) Limited.
6. This interim statement will be sent to shareholders and copies can be
obtained from the Company's registered office at The Orion Centre, 108
Beddington Lane, Croydon, Surrey CR0 4YY.
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