RNS Number:8752M
Asfare Group plc
29 November 2006
Press Release 29 November 2006
Asfare Group plc
("Asfare" or "the Company")
Interim Results for the six months ended 30 September 2006
Asfare Group plc, a leading supplier of products and services for the Emergency
Services and Homeland Security markets, today announces its Interim Results for
the six months ended 30 September 2006.
Highlights:
* Turnover doubled to #3,580,000 (2005: #1,698,000)
* Profit before interest #388,000 (2005: #66,000 loss)
* Profit after tax #228,000 (2005: #98,000 loss)
* Adjusted Earnings Per Share 6.6p (2005: -0.6p loss per share)
* Successful acquisition and integration of the Collins Youldon business
* Secured a #1.1 million order for the London Fire Brigade
* Proceeds of #1.3 million from the sale of the Todd property in Chelmsford
* Interim dividend of 1.0 pence per share
Commenting on the interim results for the six months to 30 September 2006, Tim
Wightman, Chairman said: "In the first six months of this financial year the
Company has made significant steps to grow both organically and through
acquisition. The acquisition of Collins Youldon increases the range of quality
products we supply our key markets. The strength of the order book, and the
continuing improvement in the Company's markets, give the Directors confidence
in the prospects for the second half of the year."
For further information, please contact:
Enquiries:
Asfare Group plc
Tony O'Neill, Chief Executive www.asfare.com
Tim O'Connor, Finance Director Tel: +44 (0) 2380 861 966
Seymour Pierce
Mark Percy Tel: +44 (0) 20 7107 8000
Media enquiries:
Abchurch Communications
Charlie Jack Tel: +44 (0) 20 7398 7700
charlie.jack@abchurch-group.com
- Ends -
Chairman's Interim Statement
The Company reported turnover of #3,580,000 for the six months ended 30
September 2006, which was over 100% higher than the previous year (#1,698,000).
This was driven by a buoyant fire equipment market and the acquisitions of Todd
Research and Collins Youldon. Gross margins remained strong at 54%. After
accounting for the profit on the sale of the Todd Research building, profit
before tax, interest and goodwill amortisation was #487,000, up from #8,000 in
the previous year. Profit after taxation was #228,000 compared to a loss of
#98,000 in the six months ended 30 September 2005.
In June Asfare acquired the business and assets of Collins Youldon Limited and
Ewart F Youldon Limited ("Collins Youldon"). The total cost of the acquisition
was #941,000 which was financed through bank debt of #700,000 and cash reserves.
These results include three months contribution from Collins Youldon.
In September Asfare sold the Todd Research premises in Chelmsford for
#1,300,000. The sale realised a net profit of #209,000, with #850,000 of the
proceeds being used to repay bank debt.
After fulfilling the working capital requirements associated with the
acquisition of Collins Youldon, cash outflow from operating activities was
#167,000 during the period (2005: inflow #89,000), the overall cash balance fell
by #420,000 to #81,000. Net debt rose in the period from #1,329,000 to
#1,369,000 and the gearing remained at 33%.
The Board has decided to pay an interim dividend of 1.0 pence per share.
The Market
The Asfare Group is split into two divisions; the Fire, Search & Rescue
Division, made up of AS Fire and Collins Youldon and the Detection and
Protection Division, made up of Todd Research.
Fire, Search & Rescue
Asfare consolidated its strong position in the UK fire equipment market through
the acquisition of the Collins Youldon business in June 2006 and the
announcement of two large contract wins for its subsidiary AS Fire and Rescue.
Collins Youldon adds hose reels and cable drums to the existing AS-Fire range of
ladders, beam gantries, roller shutter products and ancillary fire brigade
equipment. Furthermore, Collins Youldon broadens the Company's geographical
sales, as 40% of its revenue is in Europe and it also serves the oil tanker
industry.
The contract wins include a 5 year maintenance contract for ladders and a #1.1m
order for supplying equipment to the new fleet of London Fire Brigade
appliances. The majority of the equipment order is expected to be delivered in
the second half of the current financial year.
Detection & Protection
The Todd Research business which sells X-ray equipment for scanning postage and
baggage, continues to progress with the launch of a series of new products that
includes a value for money range designed for smaller businesses. The level of
opportunity with high profile blue chip companies remains strong and the
management believes Todd Research is well positioned to take advantage of this.
The sale of the Chelmsford property occupied by Todd Research was agreed
simultaneously with a leaseback arrangement for part of the building. The space
requirements and cost base for the business have been reduced through the
outsourcing of the manufacturing of the production of the metal cabinets.
Strategy and Acquisitions
With the Homeland Security and emergency services continuing to develop a
coordinated purchasing approach, Asfare will look to leverage its strong
position in the fire, search and rescue market to meet the continued demand for
equipment and services for international agencies, rescue services and
end-users. Increasingly, customers are looking for value-added services, for
example, training and long-term maintenance contracts, in addition to the
provision of equipment. The Company will also continue to seek acquisitions that
compliment its portfolio of products and services so as to take full advantage
of this developing market.
Outlook
The Board is pleased with the performance in the first half of the year. The
strength of the order book and the continuing improvement in the Company's
markets give the Directors confidence in the prospects for the second half of
the year. The Board believes the organisation has a sound platform to continue
its growth in 2007.
Tim Wightman
Chairman
28 November 2006
CONSOLIDATED PROFIT AND LOSS ACCOUNT
(Unaudited) (Unaudited) (Audited)
Six Months Six Months Year
Ended Ended Ended
30-Sep 30-Sep 31-Mar
2006 2005 2006
#000 #000 #000
Turnover 3,580 1,698 4,905
Cost of sales (1,656) (766) (2,069)
Gross profit 1,924 932 2,836
Administration and establishment expenses (1,745) (998) (2,380)
Operating profit before goodwill amortisation &
curtailment gain 278 8 574
Curtailment gain - - 141
Goodwill amortisation (99) (74) (259)
Operating profit / (loss) 179 (66) 456
Profit on disposal of fixed asset 209 - -
Profit / (loss) on ordinary activities before interest 388 (66) 456
Interest receivable 3 3 8
Interest payable (96) (35) (106)
Profit / (loss) on ordinary activities before taxation 295 (98) 358
Tax on ordinary activities (67) - (45)
Retained Profit / (loss) on ordinary activities after
taxation 228 (98) 313
Basic earnings / (loss) per share 4.6p (2.3p) 7.0p
Diluted earnings / (loss) per share 4.6p (2.3p) 7.0p
CONSOLIDATED BALANCE SHEET
(Unaudited) (Unaudited) (Audited)
As at As at As at
30-Sep 30-Sep 31-Mar
2006 2005 2006
#000 #000 #000
FIXED ASSETS
Intangible assets 3,704 2,689 3,510
Tangible assets 328 120 1,280
4,032 2,809 4,790
CURRENT ASSETS
Stock and work in progress 1,384 500 697
Debtors 2,031 776 1,269
Cash at bank and in hand 81 100 501
3,496 1,376 2,467
CREDITORS: amounts falling due within one year (2,418) (801) (1,786)
NET CURRENT ASSETS 1,078 575 681
TOTAL ASSETS LESS CURRENT LIABILITIES 5,110 3,384 5,471
CREDITORS:
amounts falling due after more than one year (954) (520) (1,443)
Pension Liability (62) - (62)
NET ASSETS 4,094 2,864 3,966
CAPITAL AND RESERVES
Called up share capital 1,243 1,050 1,243
Share premium account 2,346 1,872 2,346
Retained Profit 278 40 40
Profit and loss account 227 (98) 337
SHAREHOLDERS' FUNDS 4,094 2,864 3,966
CONSOLIDATED CASH FLOW STATEMENT
(Unaudited) (Unaudited) (Audited)
Six Months Six Months Year
Ended Ended Ended
30-Sep 30-Sep 31-Mar
2006 2005 2006
#000 #000 #000
Net cash (outflow)/inflow from operating
activities (167) 89 774
Returns on investment and servicing of finance
Interest received 3 3 8
Interest paid (77) (31) (92)
New Loans issue costs (14) - (18)
(88) (28) (102)
Taxation
Corporation tax paid - - (4)
Capital expenditure and financial investment
Purchase of tangible fixed assets (40) (16) (73)
Sale of tangible fixed assets 1,300 - -
1,260 (16) (73)
Acquisitions and disposals
Purchase of subsidiary undertakings - - (2,168)
Purchase of trade and assets (941) - -
Net cash acquired with subsidiaries - - 262
(941) 0 (1,906)
Equity dividends paid (99) - -
Net cash (outflow)/inflow before
management of liquid resources and financing (35) 45 (1,311)
Financing
Placing Costs - - (27)
Share Issue - - 694
New long term loan 700 - 1,250
Long term loan repayments (1,085) (120) (280)
Net cash (outflow) from financing (385) (120) 1,637
Increase / ( decrease ) in cash for the period (420) (75) 326
NET CASHFLOW FROM OPERATING ACTIVITIES
(Unaudited) (Unaudited) (Audited)
Six Months Six Months Year
Ended Ended Ended
30-Sep 30-Sep 31-Mar
2006 2005 2006
#000 #000 #000
Operating profit / (loss) 388 (66) 411
Depreciation 60 25 72
Goodwill amortisation 99 74 164
Loan cost amortisation - 4 -
Profit on sale of tangible fixed assets (209) - -
Decrease / (increase) in stock (216) 6 86
Decrease / (increase) in debtors (688) 138 (226)
(Decrease) / increase in creditors 399 (92) 267
Net cash inflow from operating activities (167) 89 774
RECONCILIATION OF NET CASH
FLOW TO MOVEMENT IN NET DEBT
(Unaudited) (Unaudited) (Audited)
Six Months Six Months Year
Ended Ended Ended
30-Sep 30-Sep 31-Mar
2006 2005 2006
#000 #000 #000
Increase / ( decrease ) in cash in the period (420) (75) 326
Cash inflow from increase in loans (700) - (1,250)
Repayment of new long term loans 1,085 120 280
Issue costs of long term loans 14 - 18
Amortisation of new loans issue costs (19) (4) (10)
Movement in net debt in the period (40) 41 (636)
Net debt brought forward (1,329) (693) (693)
Net debt carried forward (1,369) (652) (1,329)
ANALYSIS OF CHANGES IN NET DEBT
At Other At
Consolidated Cash flow 2006 01-Apr Non-Cash 30-Sep
2006 Cash Flow Movements 2006
#000 #000 #000 #000
Cash at bank and in hand 501 (420) - 81
Bank Overdrafts
Cash 501 (420) - 81
Loans (1,830) 385 (5) (1,450)
(1,329) (35) (5) (1,369)
NOTES TO THE UNAUDITED INTERIM ACCOUNTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2006
1. BASIS OF PREPARATION OF INTERIM ACCOUNTS
The accounts for the Group for the six months ended 30 September 2006, which are
unaudited, have been prepared on the basis of the accounting policies set out in
the 2006 Annual Report and Accounts and have taken into account any regulatory
changes expected to alter the 2007 Annual Report and Accounts.
The Group is required to adopt FRS 20, Share-based Payment for the year ended 31
March 2007. Under the transitional provisions contained within the Standard,
all share-based payment arrangements granted after 7 November 2002 that had not
vested prior to 1 April 2006 are recognised in the financial statements.
All goods and services received in exchange for the grant of any share-based
remuneration are measured at their fair values. Fair values of employee
services are indirectly determined by reference to the fair value of the share
options awarded. Their value is appraised at the grant date and excludes the
impact of non-market vesting conditions (for example, profitability and sales
growth targets).
All share-based remuneration is ultimately recognised as an expense in the
income statement with a corresponding credit to "other reserve".
If vesting periods or other non-market vesting conditions apply, the expense is
allocated over the vesting period, based on the best available estimate of the
number of share options expected to vest. Estimates are subsequently revised
if there is any indication that the number of share options expected to vest
differs from previous estimates. Any cumulative adjustment prior to vesting is
recognised in the current period. No adjustment is made to any expense
recognised in prior periods if share options ultimately exercised are different
to that estimated on vesting.
Upon exercise of share options the proceeds received net of attributable
transaction costs are credited to share capital.
The Directors have evaluated the accounting entries required under FRS 20, and
have concluded that these are not material. No adjustment has therefore been
reflected in the interim accounts.
2. EARNINGS PER SHARE
(Unaudited) (Unaudited) (Audited)
Six Months Six Months Year
Ended Ended Ended
30-Sep 30-Sep 31-Mar
2006 2005 2006
#000 #000 #000
Profit / (loss) after taxation 228 (98) 313
Adjustments :
Goodwill amortisation 99 74 164
Adjusted profit / (loss) 327 (24) 477
Number Number Number
Basic weighted average number of shares 4,971,112 4,200,000 4,496,582
Dilutive potential ordinary shares:
Share options - - -
Warrants - - -
4,971,112 4,200,000 4,496,582
Basic earnings / (loss) per share
Based on profit / (loss) after taxation 4.6p (2.3p) 7.0p
Loss per share on goodwill 2.0p 1.7p 3.6p
Adjusted earnings / (loss) per share 6.6p (0.6p) 10.6p
Diluted earnings / (loss) per share
Diluted basic earnings / (loss) per share 4.6p (2.3p) 7.0p
Diluted loss per share on goodwill 2.0p 1.7p 3.6p
Diluted adjusted earnings / (loss) per share 6.6p (0.6p) 10.6p
3. PUBLICATION OF NON-STATUTORY ACCOUNTS
The financial information contained in this interim statement does not
constitute statutory accounts as defined in section 240 of the Companies Act
1985. The financial information for the full preceding year is based on
statutory accounts for the financial period ended 31 March 2006. Those accounts,
upon which the auditors issued an unqualified opinion, have been delivered to
the Registrar of Companies.
INDEPENDENT REVIEW report to ASFARE GROUP PLC
INTRODUCTION
We have been instructed by the company to review the financial information for
the six months ended 30 September 2006 which comprises the balance sheet, profit
and loss account, cash flow statement and the related notes 1 to 3. We have
read the other information contained in the interim report which comprises only
the Chairman's statement and considered whether it contains any apparent
misstatements or material inconsistencies with the financial information. Our
responsibilities do not extend to any other information.
This report is made solely to the company's members, as a body, in accordance
with guidance contained in APB Bulletin 1999/4 "Review of Interim Financial
Information". Our review work has been undertaken so that we might state to the
company's members 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 and the
company's members as a body, for our review work, for this report, or for the
conclusion we have formed.
DIRECTORS' RESPONSIBILITIES
The interim report including the financial information contained therein is the
responsibility of, and has been approved by, the directors. The Listing Rules
of the Financial Services Authority require that the accounting policies and
presentation applied to the interim figures should be consistent with those
applied in preparing the preceding annual accounts except where any changes, and
the reasons for them, are disclosed.
REVIEW WORK PERFORMED
We conducted our review in accordance with guidance contained in Bulletin 1999/4
"Review of Interim Financial Information" issued by the Auditing Practices Board
for use in the United Kingdom. A review consists principally of making
enquiries of management and applying analytical procedures to the financial
information and underlying financial data and, based thereon, assessing whether
the accounting policies and presentation have been consistently applied unless
otherwise disclosed. A review excludes audit procedures such as tests of
controls and verification of assets, liabilities and transactions. It is
substantially less in scope than an audit performed in accordance with United
Kingdom auditing standards and therefore provides a lower level of assurance
than an audit. Accordingly, we do not express an audit opinion on the financial
information.
REVIEW CONCLUSION
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 September 2006.
GRANT THORNTON UK LLP
CHARTERED ACCOUNTANTS
Portsmouth
28th November 2006
This information is provided by RNS
The company news service from the London Stock Exchange
END
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