RNS Number:9736U
Chapelthorpe PLC
30 November 2000
Interim Results
Half-year ended 30 September 2000
Highlights
* Turnover increased by 21% to #70m (1999: #58m)
* Increased sales from North America
* Acquisition of American Fibers and Yarns in July,
allows accelerated penetration of strategically
important US automotive market
* New umbrella frame production capacity to allow for
increased penetration of US and European markets
and provides considerable organic growth potential
* Reorganisation of Specialist Coatings operations
in the UK provides base for improved future
operational performance
* Performance of Asota in line with expectations
* Interim dividend maintained at 0.63p per share
* Purchase and cancellation of 9.7m ordinary shares
which enhanced earnings for the remaining shareholders
* No firm proposals yet received re possible offer for
the Company, shareholders will be kept informed of
developments
Charles Godwin, Chairman commented:
" Over the past three years we have concluded a number of
strategically important moves to reduce our dependence on
manufacturing in the UK whilst at the same time building
and developing important businesses in North America and
Europe. Despite the high level of activity on these fronts,
our UK businesses, and in particular, the export led ones,
have still suffered from the twin impact of the strength
of sterling and increased raw material costs, damaging
turnover and margin.
"In our trading statement, issued 31 August 2000, we indicated
that we expected these negative conditions to improve as the year
progressed and looked forward to a much improved second
half. Thus far neither of these external factors have moved
in our favour. However, we still have grounds for belief
that raw material price pressure may well ease in the final
quarter, although we expect our operational performance in
the second half of the year will still be below our previously
expected levels.
"Looking ahead to the future, the strengthening of our North American
businesses combined with the success of our Austrian operation gives
us grounds for cautious optimism. We will continue to optimise the
return on the significant strategic investments made in our businesses
as well as examining other opportunities to maximise shareholder value."
For further information; please contact:
Chris Lynch/Josh Royston Square Mile Communications 0207 601 1000
Chairman's Statement
The results for the six months to 30 September 2000 reflect
the adverse macro economic factors currently affecting
operations, namely the strength of sterling against European
currencies and the sharp increase in the cost of raw
materials - particularly those related to oil prices, both
of which remain outside our control. Counter action, where
possible, has been taken to mitigate this continuing adverse
impact on performance. However, this action has led to the
current results being further affected by exceptional items,
mainly attributable to the reorganisation of the Specialist
Coatings division in the UK and, in particular, the costs
relating to mothballing one of the manufacturing units.
In addition, we have continued our declared strategy of
growing our North American operations by the acquisition of
the staple fibre business and assets of the American Fibers
and Yarns Company, as described below.
Results
Turnover in the six months to 30 September 2000 rose to
#70.0m (1999: #58.0m), an increase of #12.0m, assisted by a
full six-month contribution from Asota, when compared with
the same period last year. Increased sales, mainly from
North America, compensated for the decline in domestic sales
arising from the continuing depressed trading conditions
prevailing for our customers in the wallcoverings and carpet
markets. Pre-exceptional operating profit, before goodwill
amortisation, was #4.0m compared with #6.0m in the same
period last year, reflecting the two principal factors which
have been referred to above.
After taking account of a higher interest charge of #1.2m
(1999: #0.7m), arising from the increase in borrowings
relating to the acquisition of Asota and American Fibers and
Yarns, and the amortisation of goodwill resulting mainly
from the Chamberlain and Asota acquisitions, pre-tax profits
before exceptional items fell to #2.3m from #5.1m in 1999. A
#10.0m exceptional charge has been recorded in relation to
costs arising from the cessation of operations at
Chamberlain Coatings' facility. This charge includes the
full write down of tangible fixed assets and an impairment
review of goodwill, in accordance with FRS11, and provisions
for ongoing site, lease and other reorganisation costs. The
fixed assets will be retained for potential use in the
future and negotiations are ongoing to mitigate the
outstanding lease costs.
After exceptional items the pre-tax loss for the period was
#7.9m compared with a pre-tax profit of #4.9m in 1999.
Earnings per share, pre-exceptional items, fell to 0.67p
(1999: 1.64p), whilst, post exceptional items, losses per
share were 3.40p, compared with earnings per share in 1999
of 1.36p.
Purchase of own shares
Following the authority granted to us by shareholders to
purchase up to 15% of the issued share capital of the
Company, 9,746,556 ordinary shares were purchased and
cancelled between 9 June and 18 July 2000, which represented
4.5% of the issued share capital, at that time. These share
buy backs, given that the cost of capital is significantly
below the cost of dividends, are earnings enhancing and as
long as these circumstances prevail, subject to regulatory
constraints, we will consider additional share purchases up
to our authorised level when appropriate. Following the
above cancellation of ordinary shares, the number of shares
now in issue stands at 204,040,900.
Dividends
The Board is declaring an unchanged interim dividend of
0.63p per share, which will be payable on 12 February 2001
to shareholders on the register as at 15 December 2000.
Following the introduction of the Dividend Reinvestment Plan
(the "Plan") in July 2000, shareholders will once again have
the opportunity to reinvest the whole of their cash
dividends in the purchase of additional shares in the
Company in the open market at competitive dealing rates. The
last date for election to participate in the Plan is 22
January 2001.
Balance Sheet
The recent share buy backs referred to above and the
exceptional reorganisation and impairment provisions have
been the main contributory factors in the reduction of
shareholders' funds to #54.9m (1999: #61.2m). This reduction
when coupled with the increase in borrowings necessary to
complete the acquisition in the USA has resulted in gearing
of 76.9%. This level of borrowings was well within our
agreed facilities.
On 14 November 2000 revised banking facilities were put in
place, which provide longer term funding, resulting in a
debt profile maturing over a period of years and which is
more appropriate to the Group's requirement.
Acquisition
On 31 July 2000 our US subsidiary, Drake Extrusion, Inc.,
completed the strategically important acquisition of the
staple fibre business and assets of the American Fibers and
Yarns Company ("AFY") for a cash consideration of US $8.7m
(excluding costs). AFY is the preferred supplier of coloured
polypropylene fibre to the US automotive industry, in
particular to General Motors and Chrysler, and is an
excellent fit for our existing business. We are currently a
supplier to Ford of coloured polypropylene fibre, which is
used in the kick panels, parcel shelves and boot linings of
motor vehicles and this acquisition will accelerate our
penetration into this important market segment. The
business, which is currently based at Spartanburg, South
Carolina, has been integrated into our US fibres division.
Half-year review
As shareholders will be well aware, the economic climate
over the past two to three years has resulted in
increasingly challenging trading conditions for ourselves
and our UK customers. The strength of sterling over this
period against European currencies has had a major negative
impact on our UK export led manufacturing businesses and our
export volumes have been maintained only at the expense of
margin. In addition to this impact on our export business,
our UK customers' businesses have become increasingly
affected by import penetration.
Shareholders will also be aware that since 1995, when we
first developed a manufacturing base on a greenfield site in
the USA, we have taken a number of strategic steps to
develop stronger businesses outside the UK. The timeliness
of those steps is becoming more apparent day by day. The
duration of the problems in the UK is extremely difficult to
gauge and largely outside our control. Consequently, our UK
businesses have been streamlined but, being largely capital
intensive operations, they still retain the capability to
exploit rapidly any significant increase in demand.
Specialist Coatings
This division is principally involved in the manufacture of
vinyl coated base paper and plastisols, mainly for the
wallcoverings industry worldwide. Turnover in the period was
#24.2m (1999: #25.3m) and operating profit before
exceptional items and goodwill amortisation was #1.3m (1999:
#2.6m).
UK and Europe
In the last Annual Report we commented that the domestic
retail wallpaper market was the worst in living memory and
sadly there has been no sign of any improvement, if
anything, the market has worsened. In addition, the strength
of sterling has provided a number of opportunities for our
European competitors, particularly from France, to supply
the UK market. Despite these factors the division managed a
good sales performance in direct exports to European
manufacturers, albeit at lower margins than we would have
liked.
We do not anticipate that the second half of the year will
bring about any recovery in the domestic market as volumes
are expected to remain flat. However, we do believe that
better operational performance will arise following the
recent reorganisation of our UK manufacturing facilities.
North America
Our business in Canada continues to perform satisfactorily
as a consequence of our ability to respond to changing
demand directed to heavier vinyl and more specialised
products.
The US market has been less buoyant than anticipated and
currency has been the major determinant. The relative
strength of the US dollar has allowed some import
penetration. Consequently, we have taken the opportunity to
change the specification on our second coating line, prior
to its commissioning, in order to optimise the opportunities
in the commercial market for more value added specialist
products, not readily available through imports. This line
is now expected to be fully operational by early 2001.
Fibres
This division is involved in the manufacture of coloured
polypropylene fibres and filament yarns which are supplied
to the floorcoverings, automotive, technical textiles,
geotextiles and home furnishings markets worldwide. Turnover
was #40.3m (1999: #25.5m) and operating profit pre-
exceptional items and goodwill amortisation was #1.7m (1999:
#2.1m).
UK and Europe
Raw material cost increases and the rise in the value of
sterling made for extremely tough conditions in most of our
markets. In particular, the weakness in the UK carpet
sector, subjected to increased penetration of imported
products, impacted on profitability. Despite the
reorganisation of our UK businesses and the concentration of
the majority of production at one site, the continued
squeezing of export margins has seen operating profits fall.
Conversely, the acquisition of Asota has been very
beneficial with the major factors impacting on our UK
businesses working to our advantage in Continental Europe.
This business performed in line with expectations and,
although having only been part of the Group for just over 12
months, it now makes a significant contribution to the
division's profitability.
North America
Overall, the fibres business in the US continues to perform
satisfactorily although increases in the cost of raw
materials are having a negative effect. As the build up
phase in our Martinsville facility will be completed in the
second half of the year, we will be in a better position to
maximise the return on our strategic investment. The
acquisition of AFY represents a great opportunity for us in
the US automotive markets and will enable us to develop our
business still further. We will continue to work closely
with our customers and suppliers to ensure that we are in
the best possible position to reap the full benefit of this
acquisition.
Umbrella Frames
This division is involved in the manufacture of specialist
frames for sun and sporting umbrellas. Turnover in the
period was #5.6m (1999: #5.4m) and operating profit pre-
exceptional items was #1.0m (1999: #1.3m). Comparative
figures exclude Shaw Export Services, which was sold in July
1999. Despite the strength of sterling, our position as
market leader in Europe remains unchallenged and new markets
have been opened up in Eastern Europe and South America.
Profitability, however, has suffered in order to prevent
business being lost to major competitors, predominantly
based in Europe. With additional capacity coming on stream,
the constraints restricting further penetration of the US
and European markets will be removed and the potential for
continued organic growth is substantial.
Update on possible offer for the Company
On 21 November 2000, it was announced that Brian Leckie, the
Chief Executive, had been given permission to approach funders
with a view to making an offer for the Company. As previously
announced, a committee of independent Directors has been
formed to consider any proposal when received and shareholders
will be kept informed of developments.
Outlook
Over the past three years we have concluded a number of
strategically important moves to reduce our dependence on
manufacturing in the UK whilst at the same time building and
developing important businesses in North America and Europe.
Despite the high level of activity on these fronts, our UK
businesses, and in particular, the export led ones, have
still suffered from the twin impact of the strength of
sterling and increased raw material costs, damaging turnover
and margin. In our trading statement, issued 31 August 2000,
we indicated that we expected these negative conditions to
improve as the year progressed and looked forward to a much
improved second half. Thus far neither of these external
factors have moved in our favour. However, we still have
grounds for belief that raw material price pressure may well
ease in the final quarter, although we expect our
operational performance in the second half of the year will
still be below our previously expected levels.
Looking to the future, the strengthening of our North
American businesses combined with the success of our
Austrian operation gives us grounds for cautious optimism.
We will continue to optimise the return on the significant
strategic investments made in our businesses as well as
examining other opportunities to maximise shareholder value.
Charles Godwin
Chairman
Consolidated Profit and Loss Account
Half-year ended 30 September 2000
Operating Exceptional Half-year
activities items 30 September
2000 2000 2000
Notes #000 #000 #000
________________________________________________________________________
Turnover 2 70,044 - 70,044
________________________________________________________________________
Operating profit
continuing operations 4,013 - 4,013
exceptional items - (7,504) (7,504)
goodwill amortised (437) (3,002) (3,439)
_________________________________________________________________________
Total operating profit 2,6 3,576 (10,506) (6,930)
Exceptional items
relating to disposals
of businesses 6 - 297 297
Profit on sale of property - - -
Interest 1,228 - 1,228
_________________________________________________________________________
(Loss) profit on ordinary activities
before taxation
Profit before taxation
and exceptional items 2,348 - 2,348
Exceptional items - (10,209) (10,209)
Total (loss) profit on
ordinary activities
before taxation 2,348 (10,209) (7,861)
_________________________________________________________________________
Taxation on (loss) profit on
ordinary activities
Taxation on profit before
exceptional items 930 - 930
Taxation relating to
exceptional items - (1,788) (1,788)
Total taxation on (loss)
profit on ordinary activities 930 (1,788) (858)
_________________________________________________________________________
(Loss) profit for the period 1,418 (8,421) (7,003)
Dividends:
Preference 23
Ordinary 1,184
1,207
_________________________________________________________________________
Retained (deficit) profit (8,210)
_________________________________________________________________________
Consolidated Profit and Loss Account (Continued)
Half-year ended 30 September 2000
Half-year Year
30 September 31 March
1999 2000
Notes #000 #000
________________________________________________________________________
Turnover 2 58,010 125,545
________________________________________________________________________
Operating profit
continuing operations 6,025 12,528
exceptional items - (1,742)
goodwill amortised (281) (725)
_________________________________________________________________________
Total operating profit 2,6 5,744 10,061
Exceptional items
relating to disposals
of businesses 6 (221) (386)
Profit on sale of property - 1,740
Interest 660 1,698
_________________________________________________________________________
(Loss) profit on ordinary activities
before taxation
Profit before taxation
and exceptional items 5,084 10,105
Exceptional items (221) (388)
Total (loss) profit on
ordinary activities
before taxation 4,863 9,717
_________________________________________________________________________
Taxation on (loss) profit on
ordinary activities
Taxation on profit before
exceptional items 1,660 2,091
Taxation relating to
exceptional items 354 -
Total taxation on (loss)
profit on ordinary activities 2,014 2,091
_________________________________________________________________________
(Loss) profit for the period 2,849 7,626
Dividends:
Preference 23 46
Ordinary 1,346 5,465
1,369 5,511
_________________________________________________________________________
Retained (deficit) profit 1,480 2,115
_________________________________________________________________________
Operating Exceptional
Notes activities items Total
_________________________________________________________________________
(Loss) earnings per
ordinary share
Half-year ended
30 September 2000
- basic (pence) 8 0.67 (4.07) (3.40)
- diluted (pence) 8 0.67 (4.07) (3.40)
_________________________________________________________________________
Half-year ended
30 September 1999
- basic (pence) 8 1.64 (0.28) 1.36
- diluted (pence) 8 1.64 (0.28) 1.36
_________________________________________________________________________
Year ended 31 March 2000
- basic (pence) 8 3.80 (0.18) 3.62
- diluted (pence) 8 3.80 (0.19) 3.61
_________________________________________________________________________
Consolidated Balance Sheet
30 September 2000
30 September 30 September 31 March
2000 1999 2000
#000 #000 #000
Fixed assets
Intangible assets 14,381 17,455 16,384
Tangible assets 64,919 61,439 64,304
___________________________________________________________________________
79,300 78,894 80,688
___________________________________________________________________________
Current assets
Stocks 17,257 12,703 12,634
Debtors 36,355 37,547 40,080
Cash at bank and short-term
deposits 6,685 6,828 8,637
___________________________________________________________________________
60,297 57,078 61,351
Creditors
Amounts falling due within one year 70,916 63,244 69,531
___________________________________________________________________________
Net current (liabilities) (10,619) (6,166) (8,180)
___________________________________________________________________________
Total assets less current
liabilities 68,681 72,728 72,508
Creditors
Amounts falling due after more
than one year 3,191 6,159 3,503
Provisions for liabilities
and charges 10,565 5,299 5,949
Deferred income - 38 35
__________________________________________________________________________
Net assets 54,925 61,232 63,021
__________________________________________________________________________
Capital and reserves
Called up share capital 11,002 11,471 11,489
Reserves 43,923 49,761 51,532
__________________________________________________________________________
Total shareholders' funds 54,925 61,232 63,021
__________________________________________________________________________
Attributable to:
Equity interests 54,125 60,432 62,221
Non-equity interests 800 800 800
__________________________________________________________________________
54,925 61,232 63,021
__________________________________________________________________________
Consolidated Cash Flow Statement
Half-year ended 30 September 2000
Half-year Half-year Year
30 September 30 September 31 March
2000 1999 2000
Notes #000 #000 #000
____________________________________________________________________________
Net cash inflow from
operating activities 3 1,782 4,400 10,664
____________________________________________________________________________
Returns on investments and
servicing of finance
Interest received 102 207 345
Interest paid (1,316) (913) (2,124)
Interest element of finance
lease rental payments (2) (3) (9)
Dividends paid on non-equity
shares (23) (23) (46)
____________________________________________________________________________
Net cash (outflow) from
returns on investments
and servicing of finance (1,239) (732) (1,834)
_____________________________________________________________________________
Taxation (1,178) (5,554) (4,086)
_____________________________________________________________________________
Capital expenditure
Purchases of tangible fixed assets (1,816) (7,771) (13,816)
Sales of tangible fixed assets 4 64 76
Sales of properties held for resale 6,357 - -
_____________________________________________________________________________
4,545 (7,707) (13,740)
_____________________________________________________________________________
Acquisitions and disposals
Disposals of businesses - 3,856 3,939
Purchases of businesses 7 (6,303) (10,291) (10,370)
_____________________________________________________________________________
(6,303) (6,435) (6,431)
_____________________________________________________________________________
Equity dividends paid (4,066) (2,237) (3,414)
_____________________________________________________________________________
Financing
Purchase of own shares (2,956) - -
Issue of ordinary share capital - 4 7
Costs of share issues (5) (3) (15)
Increase in short-term deposits - (3,955) -
Loans advanced 3,973 - -
Repayment of amounts borrowed (5,296) (5,000) (12,744)
Capital element of finance lease
rental payments (5) (54) (129)
_____________________________________________________________________________
Net cash (outflow) from financing (4,289) (9,008) (12,881)
_____________________________________________________________________________
(Decrease) in cash 4 (10,748) (27,273) (31,722)
_____________________________________________________________________________
Total Recognised Gains and Losses
Half-year ended September 2000
Half-year Half-year Year
30 September 30 September 31 March
2000 1999 2000
#000 #000 #000
_____________________________________________________________________________
(Loss) profit for the period (7,003) 2,849 7,626
Exchange translation adjustments
on foreign currency net
investments 3,075 (706) 338
_____________________________________________________________________________
Total recognised gains
and losses for the period (3,928) 2,143 7,964
_____________________________________________________________________________
Movement in Shareholders' Funds
Half-year ended 30 September 2000
Half-year Half-year Year
30 September 30 September 31 March
2000 1999 2000
#000 #000 #000
____________________________________________________________________________
(Loss) profit for the period (7,003) 2,849 7,626
Dividends (1,207) (1,369) (5,511)
Scrip dividend adjustments - 1,822 1,941
____________________________________________________________________________
(8,210) 3,302 4,056
Purchase of own shares (2,956) - -
Issue of ordinary share capital - 4 7
Costs of share issues (5) (3) (15)
Goodwill reinstated on disposal
of business - 1,428 1,428
Exchange translation adjustments
on foreign currency net
investments 3,075 (706) 338
___________________________________________________________________________
(Decrease) increase in
shareholders' funds (8,096) 4,025 5,814
Shareholders' funds at
1 April 2000 63,021 57,207 57,207
___________________________________________________________________________
Shareholders' funds at
30 September 2000 54,925 61,232 63,021
___________________________________________________________________________
Notes to the Interim Accounts
1. Basis of preparation
The interim accounts for the half-year ended 30 September
2000 have been prepared using accounting policies
consistent with those set out in the 2000 Report &
Accounts and are unaudited. The consolidated profit and
loss account, cash flow statement and statement of total
recognised gains and losses for the year ended 31 March
2000 and the consolidated balance sheet as at that date
are an abridged version of the full historical cost
accounts which received an unqualified report by the
auditors and have been filed with the Registrar of
Companies.
2. Turnover and operating profit
Area of activity
Turnover
__________________________________________
Half-year Half-year Year
30 September 30 September 31 March
2000 1999 2000
#000 #000 #000
_____________________________________________________________________________
Continuing operations
Specialist Coatings 24,160 25,347 49,153
Fibres 40,260 25,481 61,359
Umbrella Frames 5,624 7,182 15,033
_____________________________________________________________________________
70,044 58,010 125,545
Goodwill amortised
_____________________________________________________________________________
70,044 58,010 125,545
_____________________________________________________________________________
Geographical area
Half-year Half-year Year
30 September 30 September 31 March
2000 1999 2000
Region of origin #000 #000 #000
_____________________________________________________________________________
Continuing operations
United Kingdom 33,805 37,860 76,107
North America 25,911 19,572 38,848
Europe 10,328 578 10,590
_____________________________________________________________________________
70,044 58,010 125,545
Goodwill amortised
____________________________________________________________________________
70,044 58,010 125,545
____________________________________________________________________________
2. Turnover and operating profit (continued)
Area of activity
Pre-exceptional
operating profit
__________________________________________
Half-year Half-year Year
30 September 30 September 31 March
2000 1999 2000
#000 #000 #000
_____________________________________________________________________________
Continuing operations
Specialist Coatings 1,330 2,622 5,034
Fibres 1,723 2,095 4,395
Umbrella Frames 960 1,308 3,099
_____________________________________________________________________________
4,013 6,025 12,528
Goodwill amortised (437) (281) (725)
_____________________________________________________________________________
3,576 5,744 11,803
_____________________________________________________________________________
Geographical area
Half-year Half-year Year
30 September 30 September 31 March
2000 1999 2000
Region of origin #000 #000 #000
_____________________________________________________________________________
Continuing operations
United Kingdom 1,597 3,973 7,892
North America 1,755 2,036 3,915
Europe 661 16 721
_____________________________________________________________________________
4,013 6,025 12,528
Goodwill amortised (437) (281) (725)
____________________________________________________________________________
3,576 5,744 11,803
____________________________________________________________________________
Half-year Half-year Year
30 September 30 September 31 March
2000 1999 2000
Region of destination #000 #000 #000
________________________________________________________________________
United Kingdom 19,989 22,500 43,005
Europe 21,081 14,623 40,580
North America 26,938 19,907 39,576
Africa and Middle East 491 355 562
Australia and Far East 1,545 625 1,822
________________________________________________________________________
70,044 58,010 125,545
________________________________________________________________________
Following the acquisition of the staple fibre business of
American Fibers and Yarns Company, the business,
operational and management systems of this facility were
totally integrated within an existing operation.
Therefore, it has not been possible to separately identify
the results of the acquired business. These results are
combined within the continuing operations of the Fibres
division.
3. Reconciliation of operating profit to net cash inflow
from operating activities
Half-year Half-year Year
30 September 30 September 31 March
2000 1999 2000
#000 #000 #000
______________________________________________________________________________
Operating profit before
exceptional items 3,576 5,744 11,803
Depreciation 3,478 2,914 6,064
Amortisation of goodwill 437 281 725
Net cash (outflow) in respect
of operating exceptional items (480) - -
Net cash (outflow) in respect
of prior year aborted
acquisition bid (1,409) - (540)
Net cash (outflow) in respect
of previous fundamental
reorganisation (3) (773) (743)
Capital grants transfer (5) (6) (9)
(Increase) in stocks (2,502) (1,550) (1,405)
Decrease (increase) in debtors 596 805 (662)
(Decrease) in creditors (1,906) (3,015) (4,569)
_____________________________________________________________________________
Net cash inflow from
operating activities 1,782 4,400 10,664
_____________________________________________________________________________
4. Reconciliation to net debt
Half-year Half-year Year
30 September 30 September 31 March
2000 1999 2000
#000 #000 #000
____________________________________________________________________________
(Decrease) in cash in the period (10,748) (27,273) (31,722)
Decrease in debt and finance
leasing 1,328 9,009 12,873
____________________________________________________________________________
Change in net debt from cash flows (9,420) (18,264) (18,849)
Loans relating to business acquired - (4,713) (4,713)
Exchange adjustments 207 (302) 469
____________________________________________________________________________
Movement in net debt in the period (9,213) (23,279) (23,093)
Net debt at 1 April 2000 (33,044) (9,951) (9,951)
____________________________________________________________________________
Net debt at 30 September 2000 (42,257) (33,230) (33,044)
____________________________________________________________________________
5. Analysis of net debt
1 April Cash Other Exchange 30 September
2000 flow non-cash movement 2000
#000 #000 #000 #000 #000
______________________________________________________________________________
Cash at bank and in hand 8,637 (2,205) 253 6,685
Overdrafts and short-term
facilities (30,515)(8,543) 21 (39,037)
_____________________________________________________________________________
(10,748)
_____________________________________________________________________________
Debt due after more than
one year (3,496) - 291 16 (3,189)
Debt due within one year (7,584) 1,323 (291) (83) (6,635)
Finance leases (86) 5 (81)
______________________________________________________________________________
1,328
______________________________________________________________________________
(33,044)(9,420) 207 (42,257)
______________________________________________________________________________
6. Exceptional items
As part of a Group reorganisation during the period, the
business of Chamberlain Coatings Limited was transferred
to Speciality Coatings (Darwen) Limited and production
ceased at Chamberlain's premises in Bishop Auckland.
An analysis of the exceptional costs in relation to the
closure of the Bishop Auckland operation and other
reorganisation costs for the period ended 30 September
2000 is as follows:
Costs
Costs relating to prior
Chamberlain relating to year aborted 2000
Coatings reorganisation acquisition bid Total
#000 #000 #000 #000
______________________________________________________________________________
Impairment provisions
provided:
Intangible fixed assets (3,002) - - (3,002)
Tangible fixed assets (2,359) - - (2,359)
Debtors (128) - - (128)
Provisions for liabilities (4,321) - - (4,321)
Capital grants 30 - - 30
______________________________________________________________________________
(9,780) - - (9,780)
Other costs (paid)
relating to operating
exceptional items (220) (82) (209) (511)
Other costs (accrued)
relating to operating
exceptional items - (215) - (215)
______________________________________________________________________________
Costs relating to
operating exceptional
items (10,000) (297) (209)(10,506)
______________________________________________________________________________
Release of provision against
deferred consideration from
prior year disposal - 300 - 300
(Loss) relating to previous
fundamental reorganisation - (3) - (3)
______________________________________________________________________________
Costs relating to non-operating
exceptional items - 297 - 297
______________________________________________________________________________
Total exceptional items (10,000) - (209)(10,209)
______________________________________________________________________________
Reconciliation to cash flow statement
Costs
Costs relating to prior
Chamberlain relating to year aborted 2000
Coatings reorganisation acquisition bid Total
#000 #000 #000 #000
______________________________________________________________________________
Costs (paid) above (220) (82) (209) (511)
Net cash (outflow)
relating to costs
provided in previous
years - (178) (1,200) (1,378)
______________________________________________________________________________
Net cash (outflow)
relating to operating
exceptional items (220) (260) (1,409) (1,889)
Net cash (outflow)
relating to previous
fundamental
reorganisation - (3) - (3)
______________________________________________________________________________
(220) (263) (1,409) (1,892)
______________________________________________________________________________
7. Acquisition of business
On 31 July 2000 the Group acquired the staple fibre
business and assets of American Fibers and Yarns Company,
a producer of coloured polypropylene fibre for supply
primarily to the automotive industry.
Goodwill arising during the period, the majority of which
relates to the acquisition of the staple fibre business of
American Fibers and Yarns Company, has been capitalised as
an intangible asset in the balance sheet and is being
amortised over a period of 20 years.
Analysis of the provisional fair values of the net assets
acquired
Provisional
fair value to
the Group
#000
______________________________________________________________________________
Tangible fixed assets 1,930
Stocks 1,767
Debtors 2,441
Creditors due within one year (24)
______________________________________________________________________________
Net assets 6,114
______________________________________________________________________________
Consideration:
Cash (including costs) 7,564
______________________________________________________________________________
Goodwill arising on acquisition 1,450
______________________________________________________________________________
Cash flows relating to the acquisition
#000
______________________________________________________________________________
Cash outflow on acquisition of business:
Consideration 7,564
Less costs accrued (1,264)
Cash outflow relating to prior year acquisition 3
______________________________________________________________________________
Consideration per cash flow statement 6,303
______________________________________________________________________________
8. (Loss) earnings per ordinary share
Basic earnings per share
_____________________________________________
Half-year Half-year Year
30 September 30 September 31 March
2000 1999 2000
#000 #000 #000
_____________________________________________________________________________
(Loss) profit for
the period (7,003) 2,849 7,626
Dividends on preference
shares (23) (23) (46)
Exceptional items - - -
_____________________________________________________________________________
(Loss) earnings
attributable to
ordinary shareholders (7,026) 2,826 7,580
_____________________________________________________________________________
Weighted average
number of ordinary
shares in issue during
the period (000's) 206,867 207,716 209,463
______________________________________________________________________________
(Loss) earnings per
ordinary share (pence) (3.40) 1.36 3.62
______________________________________________________________________________
8. (Loss) earnings per ordinary share (continued)
Earnings per share before exceptional items
_____________________________________________
Half-year Half-year Year
30 September 30 September 31 March
2000 1999 2000
#000 #000 #000
_____________________________________________________________________________
(Loss) profit for
the period (7,003) 2,849 7,626
Dividends on preference
shares (23) (23) (46)
Exceptional items 8,421 575 388
_____________________________________________________________________________
(Loss) earnings
attributable to
ordinary shareholders 1,395 3,401 7,968
_____________________________________________________________________________
Weighted average
number of ordinary
shares in issue during
the period (000's) 206,867 207,716 209,463
______________________________________________________________________________
(Loss) earnings per
ordinary share (pence) 0.67 1.64 3.80
______________________________________________________________________________
Diluted earnings per share
__________________________________________________
Half-year Half-year Year
30 September 30 September 31 March
2000 1999 2000
#000 #000 #000
______________________________________________________________________________
(Loss) profit for the
period (7,003) 2,849 7,626
Dividends on preference
shares (23) (23) (46)
______________________________________________________________________________
(Loss) earnings attributable
to ordinary shareholders (7,026) 2,826 7,580
______________________________________________________________________________
Weighted average number of
ordinary shares in issue during
the period (000's) 206,867 207,716 209,463
Dilutive effect of
share options (000's) - 290 224
______________________________________________________________________________
Adjusted weighted average
number of ordinary shares in issue
during the period (000's) 206,867 208,006 209,687
______________________________________________________________________________
(Loss) earnings per ordinary
share (pence) (3.40) 1.36 3.61
______________________________________________________________________________
The effect of the exceptional items on the earnings per
share for the current period is (4.07)p (1999: (0.28)p).
Distribution to shareholders
The Interim report will be despatched to shareholders on 6
December 2000. Copies may be obtained from the Company's
registered office: Chapelthorpe Hall, Church Lane,
Chapelthorpe, Wakefield, West Yorkshire, WF4 3JB.
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