Interim Results
August 07 2003 - 8:28AM
UK Regulatory
HIGHLAND TIMBER PLC
PRELIMINARY ANNOUNCEMENT OF INTERIM RESULTS
The Directors announce the unaudited statement of results for the six months
ended 30 June 2003 as follows:
PROFIT AND LOSS ACCOUNT
For the six months ended
30 June 30 June
2003 2002
�'000 �'000
Turnover 1,030 774
Cost of sales (719) (550)
Gross profit 311 224
Forestry and administration costs (321) (303)
Currency gain / (loss) 8 (36)
(313) (339)
Operating loss (2) (115)
Interest receivable 1 -
Interest payable (91) (107)
Loss before tax (92) (222)
Tax - -
Loss for the period (92) (222)
2003 2002
Pence per Pence per
share share
Loss per share 1.04 2.51
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
For the year ended
30 June 30 June
2003 2002
�'000 �'000
Loss for the financial period (92) (222)
Prior year adjustment - (176)
The total recognised gains and losses
recognised since
(92) (398)
since the last financial statement
BALANCE SHEET
As at 30 June As at 30 June
2003 2002
�'000 �'000
Fixed assets
Properties (at cost less depreciation) 10,048 11,573
Current assets
Debtors 250 129
Current liabilities
Creditors: amounts falling due within
one year
5% Convertible Unsecured Loan Stock - (1,850)
2003
Other creditors (2,991) (1,331)
(2,991) (3,181)
Net current liabilities (2,741) (3,052)
Total assets less current liabilities 7,307 8,521
Long-term liabilities
Secured bank loan (316) (750)
6,991 7,771
Capital and reserves
Called-up share capital 4,416 4,416
Share premium account 5,285 5,285
Profit and loss account (2,710) (1,930)
6,991 7,771
CASH FLOW STATEMENT
For the six months ended
2003 2002
�'000 �'000
Net cash inflow from operating 560 271
activities
Returns on investments and servicing of
finance
- Interest received 1 -
- Interest paid (91) (107)
(90) (107)
Financing
- 5% Convertible Unsecured Loan Stock (1,350) -
repaid
- Bank Loan 316 -
1,034 -
(Decrease)/ increase in cash for the (564) 164
period
Reconciliation of net cash outflow
movement to net debt
Decrease in cash in the year (564) 164
Cash inflow from debt financing of 600 (1,850)
under 1 year
Cash outflow from debt financing over 1 434 1,850
year
470 164
Net debt brought forward (3,560) (3,989)
Net debt carried forward (3,090) (3,825)
Analysis of net debt
At Cashflow At
30 June 2003 1 Jan 2003
�'000 �'000 �'000
Cash at bank and in hand and overdrafts (2,024) (564) (1,460)
Debt due in less than one year (750) 600 (1,350)
Debt due after more than one year (316) 434 (750)
(3,090) 470 (3,560)
NOTE TO THE ACCOUNTS
At 30 June 2003
The interim financial information does not comprise full financial statements
within the meaning of Section 240 of the Companies Act 1985. It has been
prepared on the basis of the accounting policies set out in the full accounts
of the Company for the year ended 31 December 2002. The auditors gave an
unqualified report on the full accounts for 2002, and these have been delivered
to the Registrar of Companies.
CHAIRMAN'S STATEMENT
As is the case with all internationally traded commodities, timber prices in
different countries are affected by currency movements. Recently sterling has
been weak and the New Zealand dollar strong. This has resulted in some improved
sentiment in the UK timber markets while in New Zealand strong domestic demand
has been offset by some weakening in export markets.
In the six months to 30 June 2003 the Company's turnover increased by 33%,
compared with the previous year, to �1,030,000 and the gross profit was 39%
higher at �311,000. Costs of improving existing plantations and replanting
after felling are put through the profit and loss account and, after these
forestry costs and administration costs, there was an operating loss of just �
2,000 compared with a loss of �115,000 last year. Lower interest rates have
reduced the interest payable and the overall loss for the period was cut from �
222,000 to �92,000.
The balance of the 5% Convertible Unsecured Loan Stock, amounting to �
1,350,000, was repaid at par on 30 June 2003 utilising an increase in the
borrowing facility from the Bank of Scotland which will mature in May 2004.
The sale of the final tranche of timber from the Kinleith forestry rights in
New Zealand took place in April 2003, yielding a profit of �183,000. The
resulting cash and other surplus funds in New Zealand totalling �740,000 were
remitted back to the UK to take advantage of the favourable exchange rate. The
Company is investigating the benefits of increasing the amount of its New
Zealand dollar borrowings in order to match more closely the proportion of its
assets held in New Zealand.
Your Directors are continuing to evaluate various options for the future of the
Company which will be determined by the vote of shareholders at the Annual
General Meeting in 2004. The Board's recommendations will be included in the
Annual Report for 2003. By then we shall have received independent valuations
as at 31 December 2003 of five of the six forests in the UK and three out of
nine in New Zealand.
In the meantime I can assure shareholders that the trees in our forests
continue to grow well and that the forestry plantations are being well managed.
.................******.
Ian Henderson
Chairman
7 August 2003
END