RNS Number:0140T
First Technology PLC
09 December 2003
9 December 2003
First Technology PLC
Interim Results for the six months ended 31 October 2003
MARGINS MAINTAINED AND EARNINGS INCREASED
- Operating margins* maintained at 20%
- Profit before tax, goodwill amortisation and exceptional items was
#11.4 million (2002: 12.4 million)
- Profit before tax increased by 9% to #7.2 million (2002: #6.6 million
after #1.5 million reorganisation costs)
- Basic earnings per share increased from 5.5p to 7.3p
- Headline earnings per share** increased to 12.9 pence (2002: 12.8 pence)
- Group turnover was #58.3 million (2002: #64.6 million) reflecting
difficult market conditions and a generally adverse exchange rate
environment
* Safety and Analysis Division increased sales by 18% in US dollar terms
* Automotive and Special Products affected by reductions in production
volumes of automotive market as a whole but good progress made with
new product developments
* Gas Sensing experienced slow summer but record orders in October and
November
* Research and Development expenditure maintained at greater than 6% of
sales
- Healthy cash generation with net cash of #2.6 million (2002 net debt:
#9.0 million)
- Interim dividend increased by 3% to 3.5 pence per share (2002: 3.4 pence)
Fred Westlake, Chairman, commented: "At the time of writing there are signs that
the US economy is starting to move forward. This is encouraging for the Group
given that some 47% of our sales are made in that market. I can report that,
despite the uncertainty in the market place, we are well positioned to seize the
opportunities as the economies of the World improve. We continue to deliver good
profit margins, our return on capital employed is high and cash generation
remains healthy.
Historically, the second half of our trading year has been stronger than the
first and we expect this trend to be repeated in the current year. Your Board
firmly believes that our chosen areas of business, together with the quality of
our staff and products, continue to give us a sharp competitive edge."
* Operating margin is defined as profit before interest, tax, goodwill
amortisation and exceptional items expressed as a percentage of turnover
** Before exceptional reorganisation costs and goodwill amortisation
For further information, please contact:
John Shepherd, Chief Executive Lulu Bridges/ Justin Griffiths
First Technology PLC Tavistock Communications
Tel: 020 7920 3150 Tel: 020 7920 3150
Chairman's Statement
Results and Dividend
I am pleased to report that in the first half of the year the Group managed both
to maintain its operating margins* and to record a small increase in headline
earnings per share despite adverse currency movements.
Although Group sales in the period declined by nearly 10% compared to the
previous year, the actions taken by your Board last year to reduce the cost base
and improvements in efficiency have enabled operating margins to be held at 20%.
Operating costs reduced by #1 million compared to the first half of last year.
Group turnover for the six months was #58.3 million (2002: #64.6 million) and
the profit before tax, goodwill amortisation and exceptional items was #11.4
million (2002: #12.4 million), a decline of 8%. The Group continues to benefit
from its growing presence in the lower cost environment within the Dominican
Republic and the tax charge was again trimmed, enabling the Group to report an
increase in headline earnings per share to 12.9 pence (2002: 12.8 pence).
Reported profit before tax increased by 9% from #6.6 million to #7.2 million,
whilst basic earnings per share rose by 33% to 7.3 pence (2002: 5.5 pence),
reflecting the non-recurring nature of a #1.5 million (1.5 pence per share) cost
of reorganisation in the first half of last year. Your Board continues to regard
headline earnings per share as a better indicator of overall performance than
profit before tax because it excludes goodwill amortisation and exceptional
items and takes account of the lower tax environment in which the Group
operates.
In the six months since April, the Group and its customer base has faced
difficult market conditions and a generally adverse exchange rate environment.
The average US$/# exchange rate compared to the same period fell by 7%. In fact,
at the closing October exchange rate of US$1.70 = #1, the Dollar had devalued
against the Pound Sterling by more than 16% since April 2002. Had the results of
overseas subsidiaries been translated at the rates used in the prior half year,
sales would have recorded a reduction of only 7%, profit before tax, goodwill
amortisation and exceptional items would have fallen by only 4% and headline
earnings per share would have increased by 5%.
Your Board has decided to increase the interim dividend by 3% to 3.5 pence per
share (2002: 3.4 pence). The dividend is payable on 3rd March 2004 to
shareholders on the register at 6th February 2004.
The Group has continued to generate cash and at the end of the period had net
cash in hand of #2.6 million, compared to #0.1 million at the end of last April
and net debt of #9.0 million last October. The Group has historically generated
more cash in the second half of the year and this year should be no exception.
* Operating margin is defined as profit before interest, tax, goodwill
amortisation and exceptional items expressed as a percentage of turnover.
Strategy
Our goal remains unaltered. It is to build a global, world-class sensor-based
business, which serves the needs of our customers, delivers consistently high
returns for our shareholders and provides a challenging and rewarding
environment for our staff. Our operational focus remains in the areas of safety
and the environment. We design, manufacture and sell products and solutions
designed to provide improved personal safety and comfort for people around the
world and to monitor the quality of their environment more effectively.
Outlook
At the time of writing there are signs that the US economy is starting to move
forward. This is encouraging for the Group given that some 47% of our sales are
made in that market. However, global economic uncertainty still prevails making
it difficult to predict the overall performance in the near term for
international businesses such as ours. I can report that, despite this
uncertainty in the market place, we are well positioned to seize the
opportunities as the economies of the World improve. We continue to deliver good
profit margins, our return on capital employed is high and cash generation
remains healthy.
Historically, the second half of our trading year has been stronger than the
first and we expect this trend to be repeated in the current year.
Your Board firmly believes that our chosen areas of business, together with the
quality of our staff and products, continue to give us a sharp competitive edge.
Fred Westlake
Chairman
Chief Executive's Review
MARKETS AND OPERATIONS
Despite some difficult trading conditions and adverse currency movements, we
maintained our excellent margins in the first half. It is particularly pleasing
to achieve this result without having to compromise our R&D investment, the key
to future growth. Margins have been sustained because of our relentless cost
improvement efforts which have allowed the Group to maintain R&D investment at
greater than 6% of sales. These efforts have been supported by our group-wide
"Lean Enterprise" programme, which is yielding significant results through the
dedicated involvement and skills of the First Technology workforce.
The reported results also include the impact of reduced gas sensor orders due to
an unforeseen overstocking problem at a major customer. This problem occurred at
the beginning of the first half and in recent months we have seen orders return
to at least historical levels.
GAS SENSING
Overall the gas sensing market continues to grow steadily, although the
petrochemical plant refurbishment market has seen unusual trading conditions
with the Iraq war causing many operators to delay refinery shutdowns for repairs
and maintenance. This has meant that the summer months have been slow. However,
there has been a strong resurgence in the September-November period with October
and November being record months for our Portsmouth operation. In addition, as
previously mentioned, one of our major US safety sensor customers had
over-stocked in early 2003 and unexpectedly interrupted orders for three months
over the summer. This business has now resumed at normal levels and we are
exploring a joint inventory management programme which should benefit both
parties and ensure no recurrence of the problem.
The exhaust emissions market is still growing strongly with sales to China, in
particular, up 19 % from the same period last year. As a result, we are planning
to open an office in China in the New Year in conjunction with First Technology
Safety Systems. Sales of our combustible gas pellistor sensors continue to grow
and we are now piloting some component manufacture in our Dominican Republic
plant. Sales of oxygen sensors are up 7% as we continue to take market share
from the competition.
Notwithstanding this somewhat difficult start, the continuous drive for cost
cutting and efficiency improvements has resulted in high margins being
maintained. We do not expect such difficult trading conditions in the second
half and anticipate that Gas Sensing will report full year results ahead of last
year.
On the new product front, we are making good progress with the MICROceLTM range
of miniature gas sensors which are now being designed into new ranges of
instruments by several customers. These products are so much more advanced in
terms of size and weight than those of our competitors that we are also seeing
genuine interest from the vertically integrated competition - that is,
instrument makers who normally make their own sensors.
Our innovative "in-flue" boiler gas emissions monitor is now on track for
product release at the end of the financial year in time for inclusion in
boilers for the FY05 heating season.
We have also been selected by two US manufacturers of air "ozonifiers" who are
designing our ozone sensors into their products.
We continue to refine our design of the BIOceLTM sensor to detect the hazardous
industrial enzyme subtilisin which is used in detergent manufacture. The UK
Health and Safety Executive is proposing to reduce the minimum safe exposure
limit and is expected to issue legislation recommending personal monitoring, in
addition to existing area monitoring. This legislation is expected to be in
place during 2005 and we expect initial sales to commence in FY05.
OTHER MANUFACTURING
Automotive and Special Products
The worldwide automotive market is still going through a tough period with, as
yet, no sign of a sustained recovery. In North America, production volumes for
the "Big Three" (Ford, GM and Chrysler) were down some 9% over the same period
last year, with Ford, in particular, down 14%. Overall North American production
was down 5%. Forecasts for the second half are somewhat better with production
volumes for that period expected to be 3% up over the prior year.
European volumes were also weak, down 3% overall with, again, Ford being the
worst affected. The picture in the rest of the world is mixed.
Due to longer than normal US plant shutdowns in the summer, together with a
concentrated effort by Original Equipment Manufacturers (OEM's) to reduce stock
levels, the first quarter was slower than expected, but there has been a good
recovery in the second quarter with October being particularly buoyant.
Shipments and order intake during November were also encouraging as they
continued at or above October's pace providing a good start to the second half
year.
Costs are being reduced as the "Lean Enterprise" initiative and product moves to
the Dominican Republic keep pace with customer price demands. In addition, the
benefits of last year's consolidation are now being fully realised.
Sales of our electronic sensors (solar, twilight, tunnel and fog) continue in
line with market volumes. We have a new variant of the combined solar/twilight
sensor in design for Ford and Nissan and have achieved a 100% supplier award
from Volvo for a similar device. Both of these products will begin serial
production in the second half. The market for our range of electromechanical
circuit protection devices is in line with expectations, with some volume gains
for toy and motor protection devices.
Fuel Cut Off switch sales are still declining in line with our forecasts, being
down some 14% compared to the second half of last year. This product group now
represents just 11% of Group sales, down from 43% in 1999.
Sales of our ceramic products for communication applications are up 14% in US
Dollar terms over the same period last year. Though it is too soon to say
whether this heralds a more general upturn of the telecoms market, it is the
first year over year gain in recent history.
We are making good progress with major new product developments. Our occupant
sensing device, now called Thermal Imaging Occupancy Sensor, TIOSTM (developed
with UK technology house QinetiQ), is ready for prototype vehicle testing which
will begin in the New Year with both US and European vehicle manufacturers.
Our multi-function sensing device (rain, fog, solar, twilight and tunnel) is now
in advanced prototype form, with US road testing nearing completion. Performance
is good. Customer trials will begin at multiple OEM's in the New Year. This
device has the ability to displace an array of single and dual function sensors
currently fitted to vehicles.
We have recently introduced, in conjunction with Volvo, a radiator sensor
component which is an anti-tamper device that will prohibit the fitting of
improper replacement parts. Shipping will start in the last quarter of calendar
2004 and we expect to be able to expand sales of similar devices to other
manufacturers.
We are also making good progress on a range of other new products; Battery Cut
Off devices have completed validation for a GM hybrid truck and we have been
selected by PSA for a 42 volt demonstrator vehicle. As a result of the help we
gave a North American OEM in resolving a vehicle recall problem, we have been
selected to protect cooling fan motors for a major Tier 1 supplier. We are also
encouraged by the selection of our absolute position sensor by a Tier 1 supplier
to be used in a steering/stability system, which will be marketed to various
OEM's.
Safety and Analysis
Regulation continues to drive the overall market with the next generation side
impact (ES-2) legislation now targeted for March 2004.
This business has continued to perform strongly with sales up 18% in US Dollar
terms. The South Korean market has been particularly buoyant with sales up more
than 130% over the same period. This has been mainly as a result of GM Daewoo
upgrading their capability as well as significant investments from Hyundai.
North America has again shown growth with sales up 25% in Dollar terms and the
Japanese market has continued the growth seen in the second half of last year,
being up by 18% in Yen terms. As expected, the European market has slowed down
somewhat after exceptionally strong sales last year; down 16% in Euro terms.
We are continuing our strong investment in new technology and our market leading
iDummyTM systems are now in test at many locations worldwide including:
Transport Canada, Volvo, BMW, VW, Audi, Fiat, Ford and Toyota.
We have recently opened a new state-of-the-art facility in Heidelberg, Germany,
in order to improve our customer responsiveness to local product development.
This calibration and repair facility complements the existing facilities in
Nagoya, Japan, Ohio and Michigan, US.
In order to maintain and expand our market position we are constantly investing
to broaden the products and services we offer. Car design engineers are now
required to design-in 5 star safety test ratings using sophisticated
computer-aided tools which perform virtual crash tests. Our software dummy data
sets are key to this process and can be used with all the major design tools
used by OEM designers. This has enabled a further 9% growth in software sales.
In addition, we have teamed with Thames Side-Maywood Limited to sell
instrumented crash test barrier wall technologies which gives us a wider range
of products and services in this market.
Our small strain gauge business, Hitec, is performing very well and has achieved
record sales and order book. Sales are up 30% and profit is already ahead of
full year FY03. This success is principally driven by orders for products
included in a drug injection pump by Medrad Inc. of the US and general increases
in aerospace and gas turbine instrumentation work.
COMPONENT DISTRIBUTION
The market environment for distributors of electronic components within Europe,
and France in particular, has remained depressed. This is due both to the
general weakness within the French economy and the trend for electronics
companies to relocate manufacturing to cheaper countries.
RDI, our business based in Paris, has traded broadly in line with the market,
reporting a decline in sales of some 16% in local currency, but only 9% in
Sterling.
As a result of the restructuring actions taken over the last 12 months, the cost
base has been reduced to a level that has enabled the company to trade around
the break-even level with no significant impact on cash.
SUMMARY
Given the difficult markets, continued price pressure and cyclical nature of our
businesses, our ability to maintain margins demonstrates the resilience of the
Group's portfolio to these ever-changing conditions. As the markets and
economies we serve slowly recover, we look forward to reaping the rewards of our
continually improving operational gearing.
Our balance sheet remains strong and we are in a favourable position to evaluate
and close significant acquisitions. However, finding suitable candidates which
meet our exacting standards is still a challenge.
John Shepherd
Chief Executive
Group Profit and Loss Account
for the six months ended 31st October 2003
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
31st October 31st October 30th April
2003 2002 2003
Note #'m #'m #'m
Turnover 2 58.3 64.6 127.6
Cost of sales (34.5) (38.6) (75.5)
--------------------------------------------------------------------------------
Gross profit 23.8 26.0 52.1
Operating costs
Reorganisation costs 3 - (1.5) (1.5)
Goodwill:
- amortisation (4.2) (4.3) (8.7)
- impairment losses - - (4.9)
Other operating costs (12.2) (13.2) (25.6)
--------------------------------------
Total operating costs (16.4) (19.0) (40.7)
--------------------------------------------------------------------------------
Operating profit 2 7.4 7.0 11.4
Finance charges (net) (0.2) (0.4) (1.0)
--------------------------------------------------------------------------------
Profit on ordinary activities
before taxation 7.2 6.6 10.4
Tax on profit on ordinary
activities 4 (1.7) (2.4) (4.7)
--------------------------------------------------------------------------------
Profit for the period 5.5 4.2 5.7
Dividends paid and proposed 5 (2.6) (2.6) (7.2)
--------------------------------------------------------------------------------
Retained profit/(loss) for the
period 2.9 1.6 (1.5)
================================================================================
Headline earnings per share 6 12.9p 12.8p 27.2p
Basic earnings per share 6 7.3p 5.5p 7.6p
Diluted basic earnings per
share 6 7.3p 5.5p 7.6p
Dividends per share 5 3.5p 3.4p 9.5p
Profit on ordinary activities
before taxation, goodwill items
and reorganisation costs #11.4m #12.4m #25.5m
--------------------------------------
All results are derived from continuing operations
Group Balance Sheet
as at 31st October 2003
Unaudited Unaudited Audited
31st October 31st October 30th April
2003 2002 2003
Note #'m #'m #'m
Fixed assets
Goodwill 7 134.1 147.6 138.3
Tangible assets 15.9 17.3 16.8
Investments 0.5 0.1 0.5
--------------------------------------------------------------------------------
150.5 165.0 155.6
--------------------------------------------------------------------------------
Current assets
Stocks 12.8 12.5 13.9
Debtors 24.3 26.0 24.8
Cash at bank and in hand 2.6 2.7 3.8
--------------------------------------------------------------------------------
39.7 41.2 42.5
Creditors: amounts falling due
within one year
Bank loans and overdrafts 8 - (1.3) (3.7)
Other creditors (25.5) (28.1) (31.2)
--------------------------------------------------------------------------------
Net current assets 14.2 11.8 7.6
--------------------------------------------------------------------------------
Total assets less current
liabilities 164.7 176.8 163.2
Creditors: amounts falling due
after more than one year
Bank loans 8 - (10.4) -
Other creditors (0.3) (0.8) (0.5)
--------------------------------------------------------------------------------
Net assets excluding pension
liability 164.4 165.6 162.7
Pension liability (1.8) (0.9) (2.0)
--------------------------------------------------------------------------------
Net assets including pension
liability 162.6 164.7 160.7
================================================================================
Capital and reserves
Called up share capital 9 7.5 7.5 7.5
Share premium account 9 48.7 48.7 48.7
Merger reserve 9 69.6 69.6 69.6
Profit and loss account 9 36.8 38.9 34.9
--------------------------------------------------------------------------------
Equity shareholders' funds 162.6 164.7 160.7
================================================================================
Statement of Total Recognised Gains and Losses
for the six months ended 31st October 2003
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
31st October 31st October 30th April
2003 2002 2003
#'m #'m #'m
Profit for the period 5.5 4.2 5.7
Foreign currency translation (1.0) (0.3) (0.1)
Actuarial losses recognised in the
pension schemes - - (1.6)
Deferred tax thereon - - 0.5
--------------------------------------------------------------------------------
Total recognised gains and losses
relating to the period 4.5 3.9 4.5
================================================================================
Group Cash Flow Statement
for the six months ended 31st October 2003
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
31st October 31st October 30th April
2003 2002 2003
Note #'m #'m #'m
Net cash inflow from
operating activities 10.6 14.1 29.8
Returns on investment and
servicing of finance 11 (0.3) (0.3) (0.7)
Taxation 11 (1.5) (2.7) (4.3)
Capital expenditure and
financial investment 11 (1.6) (2.8) (5.1)
Acquisitions and disposals 11 - (1.4) (1.7)
Equity dividends paid (4.6) (4.4) (6.9)
--------------------------------------------------------------------------------
Net cash inflow before 2.6 2.5 11.1
financing
Financing 11 (3.6) (3.8) (10.6)
--------------------------------------------------------------------------------
Decrease in cash in the period 10 (1.0) (1.3) (0.5)
================================================================================
Reconciliation of operating profit to net cash inflow from operating activities
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
31st October 31st October 30th April
2003 2002 2003
#'m #'m #'m
Operating profit 7.4 7.0 11.4
Depreciation and amortisation
charges 6.1 6.9 18.4
Decrease/(increase) in stocks 0.6 (1.2) (2.5)
(Increase)/decrease in debtors (0.1) 2.4 3.1
(Decrease)/increase in creditors (3.1) (0.1) 1.0
Adjustment for pension funding (0.2) (0.6) (0.6)
Exchange differences (0.1) (0.3) (1.0)
--------------------------------------------------------------------------------
Net cash inflow from operating
activities 10.6 14.1 29.8
================================================================================
Notes to the Interim Accounts
for the six months ended 31st October 2003
1. (a) The results for the six months ended 31st October 2003 and 2002 are
unaudited and unreviewed. The results for the year ended 30th April 2003, as
shown in this statement, do not constitute statutory accounts within the meaning
of Section 240 of the Companies Act 1985, but have been derived from the full
audited financial statements for the year ended 30th April 2003. These have been
filed with the Registrar of Companies. The report of the auditors on the
financial statements for the year ended 30th April 2003 was unqualified. The
accounting policies used to prepare this statement are consistent with those
applied for the audited financial statements for the year ended 30th April 2003.
1. (b) The following table shows the relevant exchange rates used to translate
the results and net assets of the Group's overseas subsidiaries:
Foreign exchange/Sterling exchange rates
Average rates Closing rates
----------------------------------------------------------------------------
HY04 HY03 FY03 HY04 HY03 FY03
----------------------------------------------------------------------------
US $ 1.64 1.53 1.55 1.70 1.57 1.60
Euro 1.44 1.58 1.54 1.46 1.58 1.43
Jap Yen 191 186 188 187 191 191
============================================================================
2. Segmental analysis
(a) Turnover by origin:
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
31st October 31st October 30th April
2003 2002 2003
#'m #'m #'m
UK 22.2 19.3 43.7
Rest of Europe 6.3 12.5 19.7
North America 27.6 30.9 58.5
Japan 2.2 1.9 5.7
--------------------------------------------------------------------------------
58.3 64.6 127.6
================================================================================
(b) Turnover by destination:
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
31st October 31st October 30th April
2003 2002 2003
#'m #'m #'m
UK 3.7 3.5 7.4
Rest of Europe 19.7 22.4 45.0
North America 27.1 32.9 62.0
Asia 6.9 4.5 11.2
South America 0.4 0.6 0.9
Other 0.5 0.7 1.1
--------------------------------------------------------------------------------
58.3 64.6 127.6
================================================================================
(c) Turnover by activity:
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
31st October 31st October 30th April
2003 2002 2003
#'m #'m #'m
Gas sensing 12.1 12.6 25.5
Other manufacturing 42.3 47.7 93.7
Component distribution 3.9 4.3 8.4
--------------------------------------------------------------------------------
58.3 64.6 127.6
================================================================================
(d) Profit by activity:
Six months ended 31st October 2003 (Unaudited)
Operating
profit before
goodwill and
exceptional Goodwill Operating
items amortisation profit
#'m #'m #'m
Gas sensing 3.4 (2.3) 1.1
Other manufacturing 8.2 (1.9) 6.3
Component distribution - - -
--------------------------------------------------------------------------------
Total 11.6 (4.2) 7.4
-----------------------------------------------------------------
Finance charges (net) (0.2)
---------
Profit on ordinary
activities before tax 7.2
===============================================================================
Six months ended 31st October 2002 (Unaudited)
Operating
profit before
goodwill and
exceptional Reorganisation Goodwill Operating
items costs amortisation profit
#'m #'m #'m #'m
Gas sensing 4.2 - (2.4) 1.8
Other manufacturing 8.5 (0.8) (1.8) 5.9
Component distribution 0.1 (0.7) (0.1) (0.7)
--------------------------------------------------------------------------------
Total 12.8 (1.5) (4.3) 7.0
-------------------------------------------------------------------
Finance charges (net) (0.4)
---------
Profit on ordinary
activities before tax 6.6
================================================================================
Year ended 30th April 2003 (Audited)
Operating
profit before
goodwill, and Re-
exceptional organisation Goodwill Goodwill Operating
items costs amortisation impairment profit
#'m #'m #'m #'m #'m
Gas sensing 8.5 - (4.9) (4.0) (0.4)
Other
manufacturing 18.0 (0.8) (3.7) - 13.5
Component
distribution - (0.7) (0.1) (0.9) (1.7)
--------------------------------------------------------------------------------
Total 26.5 (1.5) (8.7) (4.9) 11.4
-----------------------------------------------------------------------
Finance charges (net) (1.0)
---------
Profit on ordinary
activities before tax 10.4
================================================================================
3. Reorganisation costs
Prior period reorganisation costs of #1.5 million relate to the restructure of
First Technology Automotive in the UK and Realisations et Diffusion pour
l'Industrie (RDI) in France. From Spring 2003, First Technology Automotive in
the UK ceased manufacturing, but continues to perform R&D Engineering activities
together with the European logistics function transferred from Paris.
4. Tax on profit on ordinary activities
The tax charge reflects the anticipated tax rate of the Group profit on ordinary
activities, but before goodwill amortisation, for the full year. No tax relief
is available on goodwill amortisation.
5. Dividends
The directors have declared an interim dividend of 3.5p per share (2002: 3.4p).
The dividend is payable on 3rd March 2004 to shareholders on the register on 6th
February 2004.
6. Earnings per share
The weighted average number of shares used to calculate the basic, headline and
diluted earnings per share for the six months ended 31st October 2003 is as
follows:
2003 2002
Number Number
Weighted average number of shares in issue for
basic and headline earnings per share 75,354,478 75,344,283
Dilutive effect of share options 226,762 17,800
--------------------------------------------------------------------------------
Weighted average number of shares in issue for
diluted earnings per share 75,581,240 75,362,083
================================================================================
The earnings used to calculate the basic, diluted and headline earnings per
share for the half year to 31st October 2003 are as follows:
2003 2003 2003 2002 2002 2002
Basic Diluted Basic Diluted
#'m pence pence #'m pence pence
Profit for the period 5.5 7.3 7.3 4.2 5.5 5.5
Add back: goodwill
amortisation 4.2 5.6 5.5 4.3 5.8 5.8
Add back: exceptional
integration
and reorganisation costs,
net of tax credit - - - 1.2 1.5 1.5
--------------------------------------------------------------------------------
Headline earnings 9.7 12.9 12.8 9.7 12.8 12.8
================================================================================
Headline earnings per share of 12.9p (2002: 12.8p) are considered by the
directors to provide a more meaningful measurement of financial performance than
basic earnings per share, as they exclude goodwill amortisation and exceptional
costs.
7. Intangible fixed assets
Goodwill
#'m
Cost
1st May 2003 and 31st October 2003 173.4
--------------------------------------------------------------------------------
Amortisation
1st May 2003 35.1
Charge for the period 4.2
--------------------------------------------------------------------------------
31st October 2003 39.3
--------------------------------------------------------------------------------
Net book value
31st October 2003 134.1
================================================================================
30th April 2003 138.3
================================================================================
Goodwill of #9.6 million remains written off against reserves.
8. Bank loans and overdrafts
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
31st October 31st October 30th April
2003 2002 2003
#'m #'m #'m
Repayable:
Within one year - 1.3 3.7
Between one and two years - 10.4 -
--------------------------------------------------------------------------------
- 11.7 3.7
================================================================================
At 31st October 2003, the Group had an unsecured multi-currency revolving credit
facility of US $59 million (30th April 2003: US $59 million). The facility
expires on 30th April 2004 and any drawings on the facility carry interest at
1.1% above LIBOR. A commitment fee at 0.375% is payable on the undrawn amount.
9. Share capital and reserves
Share Profit
Share premium Merger and loss
capital account reserve account
#'m #'m #'m #'m
1st May 2003 7.5 48.7 69.6 34.9
Retained profit for the period - - - 2.9
Foreign currency translation - - - (1.0)
--------------------------------------------------------------------------------
31st October 2003 7.5 48.7 69.6 36.8
================================================================================
10. Analysis and reconciliation of net cash/(debt)
1st May Cash Non-Cash Exchange 31st October
2003 flow movement movement 2003
#'m #'m #'m #'m #'m
Cash at bank and in
hand 3.8 (1.1) - (0.1) 2.6
Overdrafts (0.2) 0.2 - - -
--------------------------------------------------------------------------------
3.6 (0.9) - (0.1) 2.6
Debt due within one
year (3.5) 3.6 (0.1) - -
--------------------------------------------------------------------------------
Net cash/(debt) 0.1 2.7 (0.1) (0.1) 2.6
================================================================================
11. Analysis of cash flows
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
31st October 31st October 30th April
2003 2002 2003
#'m #'m #'m
Returns on investments and servicing
of finance
Interest paid (0.3) (0.3) (0.7)
--------------------------------------------------------------------------------
Net cash outflow from returns on
investment and servicing of finance (0.3) (0.3) (0.7)
--------------------------------------------------------------------------------
Taxation
UK corporation tax paid (0.6) (1.2) (2.4)
Overseas corporation tax paid (0.9) (1.5) (1.9)
--------------------------------------------------------------------------------
Taxation paid (1.5) (2.7) (4.3)
--------------------------------------------------------------------------------
Capital expenditure and financial
investment
Purchase of tangible fixed assets (1.6) (2.8) (4.6)
Purchase of trade investments - (0.1) (0.5)
Proceeds from disposal of fixed
assets - 0.1 -
--------------------------------------------------------------------------------
Net cash outflow from capital
expenditure and financial
investment (1.6) (2.8) (5.1)
--------------------------------------------------------------------------------
Acquisitions and disposals
Acquisition of businesses - (1.4) (1.7)
--------------------------------------------------------------------------------
Net cash outflow from acquisitions
and disposals - (1.4) (1.7)
--------------------------------------------------------------------------------
Financing
(Repayment)/drawdown of revolving
credit facility (3.6) (3.8) 1.0
Repayment of term loans - - (11.6)
--------------------------------------------------------------------------------
Net cash outflow from financing (3.6) (3.8) (10.6)
--------------------------------------------------------------------------------
Acquisition of businesses relates to deferred consideration payments in respect
of acquisitions made in prior periods.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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