TIDMLPA
RNS Number : 0569S
LPA Group PLC
21 June 2018
LPA GROUP PLC
Half-Yearly Report for the six months ended 31 March 2018
LPA Group PLC ("LPA" or the "Group"), the high reliability LED
lighting and electro-mechanical system manufacturer and
distributor, announces a strong performance for the six months to
31 March 2018, GBP1.8m of LED Lighting and power socket contracts
from a new customer and board reorganisation.
KEY POINTS
-- Revenue increased 28.9% to GBP13.93m (2017: GBP10.81m)
-- Operating profit before exceptional items increased 45.4%
to GBP1.122m (2017: GBP0.77m).
-- Exceptional costs GBP111,000 (2017: GBP115,000 costs less
GBP341,000 of property gain; net GBP226,000 gain)
-- Profit before tax increased 1.1% to GBP987,000 (2016: GBP976,000)
-- Diluted earnings per share decreased 0.30p to 6.51p (2017:
6.81p) due to increased profits chargeable to tax
-- Interim dividend increased 0.05p to 1.10p (2017: 1.05p)
-- Order entry decreased 43.4% to GBP8.40m (2017: GBP14.85m)
-- Order book stands at GBP16m (2017: GBP22m)
-- Gearing remains unchanged at 31.2% (2017: 31.6%) despite
significant increases in working capital and plant and equipment
Michael Rusch, Chairman, comments:
"In my comments at the Annual General Meeting, I reported that
output was at record levels and that this had been sustained during
the first half. I am pleased to report that operating profits have
also been at record levels and that this performance is continuing
during the third quarter and should result in an outstanding result
for the year. All parts of the Group are performing well.
However, as previously reported, the medium term maybe more
challenging. Order entry in Electro-Mechanical and to a lesser
extent in LED Lighting has not kept pace with sales and the Group
order book has declined. Successive changes in Government
procurement policy have impacted domestic supply chains for both
new and refurbished trains and there is increased competition in
our Asian markets. Nevertheless, we are rising to this challenge
and have been selected for GBP1.8m of new LED Lighting and power
socket export contracts for trains being imported to the UK, for
delivery commencing in the next financial year.
Following the appointment of Chris Buckenham as Chief Financial
Officer and Company Secretary in March 2018, we are continuing our
board reorganisation. Paul Curtis, Managing Director of LPA Channel
Electric Equipment Limited ("LPA Channel"), our highly successful
distribution business is appointed Chief Operating Officer with
effect from 1(st) October 2018, subject to standard due diligence.
Paul was apprenticed at LPA Channel, achieved an MBA and had a
successful spell as Sales and Marketing Director of LPA Connection
Systems before returning to LPA Channel as Managing Director. At
the same time, Peter Pollock, our Chief Executive will become
Chairman in succession to me, while I become Group President,
remaining a major shareholder and non-executive director. Len
Porter remains Senior Non-Executive Director. Once these board
appointments have bedded in, we expect to promote Paul to Chief
Executive Officer and to appoint a further non-executive director.
We shall be adopting the QCA Corporate Governance Code and a road
map to compliance.
We have committed a further GBP1m to capital expenditure as a
measure of our confidence in the future and we are increasing the
interim dividend by 0.05p to 1.10p."
MICHAEL RUSCH - Chairman - 21 June 2018
ENQUIRIES: Tel:
LPA Group plc
Peter Pollock, Chief Executive 01799 512844
Chris Buckenham, Chief Financial
Officer 01799 512859
Cairn Financial (Nominated Adviser) 020 7213 0880
James Caithie / Tony Rawlinson
WH Ireland (Broker) 0113 394 6600
Tim Feather / James Sinclair-Ford
Instinctif Partners (PR Advisors) 020 7457 2020
Mark Garraway / Helen Tarbet
CHAIRMAN'S STATEMENT
In my comments to the Annual General Meeting, I reported that
output was at record levels and that this had been sustained during
the first half. I am pleased to report that operating profits have
also been at record levels and that this performance is continuing
during the third quarter and should result in an outstanding result
for the year.
During the first half, Sales increased 29% to a record GBP13.9m
(2017: GBP10.8m) reflecting the exceptionally strong order book at
the start of the year and Operating Profit increased 45% to
GBP1.1m, also a new record, (2017: GBP0.8m). Exceptional costs
amounted to GBP0.1m (2017: Exceptional gain GBP0.2m). Profit before
tax amounted to GBP0.99m (2017 GBP0.98m) and diluted earnings per
share were 6.51p (2018: 6.81p). The dividend is increased by 0.05p
to 1.10p. All parts of the Group are performing well.
However, as previously indicated, the medium term maybe more
challenging. Order entry in Electro-Mechanical, and to a lesser
extent in LED Lighting, has not kept pace with sales and while
Distribution is doing well, the Group order book has declined.
Government procurement policy has changed impacting domestic supply
chains for both new and refurbished trains. The "long term through
life" cost approach used on Cross Rail and London Overground, which
favoured our reliable, long lived sustainable products has changed
to one requiring only support for the franchise period, typically
seven years. In addition, the procurement of 7000 new trains,
significantly more than the running annual average of around 700
trains, has exceeded domestic capacity to supply, necessitating
import from overseas train builders who are not yet existing
customers, presenting us with the challenge of displacing existing
suppliers to achieve orders.
The flood of new trains has meant the early retirement of some
existing trains which would otherwise have required refurbishment
and upgrade and provided us with more routine orders. This has
particularly impacted Transport+. Some of our export markets,
particularly Japan have suffered from increased competition from
China and Korea in their export markets and this has presented us
with additional challenges.
However, this scenario had been identified for some time and the
Group has acted to mitigate it. We have pursued other export
opportunities created by imported trains and have won GBP1.8m of
orders for LED Lighting and power sockets from a new entrant to the
UK market for delivery in the next financial year. We have
identified other similar opportunities which we are pursuing. We
have invested in new products development and in opening new
markets.
We are investing GBP1m in processes and automation to reduce
manufacturing costs.
We are continuing to follow a progressive dividend policy: the
interim dividend will be increased by 0.05p to 1.10p (2017: 1.05p)
which will be paid on 26 September 2018 to those shareholders
registered at the close of business on 5 September 2018.
Following the appointment of Chris Buckenham as Chief Financial
Officer and Company Secretary in March 2018, we are continuing our
board reorganisation. Paul Curtis, Managing Director of LPA Channel
Electric Equipment Limited, our highly successful distribution
business is appointed Chief Operating Officer with effect from 1st
October 2018. Paul was apprenticed at LPA Channel achieved an MBA
and had a successful spell as Sales and Marketing Director of LPA
Connection Systems before returning to LPA Channel as Managing
Director. At the same time, Peter Pollock, our Chief Executive will
become Chairman in succession to me, while I become Group
President, remaining a major shareholder and Non-Executive
Director. Len Porter remains Senior Non-Executive Director. Once
these board appointments have bedded in, we expect to promote Paul
to Chief Executive Officer and to appoint a further non-executive
director.
We shall be adopting the QCA Corporate Governance Code and a
road map to full compliance.
As previously reported the levels of sales and profits in the
current year are exceptional and may be under pressure next year,
but the funnel of opportunities, which leads to the pipeline of
orders and order entry, is very encouraging. The Group is in robust
shape and we look forward to the future with great confidence.
MICHAEL RUSCH
Chairman - 21 June 2018
CONSOLIDATED
INCOME
STATEMENT
6 months
6 months to to Year to
31 March 31 March 30 Sept
2018 2017 2017
Unaudited Unaudited Audited
GBP000 GBP000 GBP000
Revenue 13,929 10,807 22,482
----------------------------------- -------------------------------- -----------------------------
Operating
profit before
exceptional
items 1,122 772 1,895
Gain on sale
of property - 341 341
Relocation and
other
nonrecurring
costs (111) (115) (268)
Operating
profit 1,012 998 1,968
Finance costs (43) (32) (75)
Finance income 18 10 21
Profit before
tax 987 976 1,914
Taxation (127) (78) (146)
Profit for the
period 860 898 1,768
=================================== ================================ =============================
Attributable
to:
- Equity
holders of
the parent 860 898 1,768
=================================== ================================ =============================
Earnings per
share (see note
2)
- Basic 6.95p 7.37p 14.40p
- Diluted 6.51p 6.81p 13.42p
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
6 months to 6 months Year to
31 March to 31 March 30 Sept
2018 2017 2017
Unaudited Unaudited Audited
GBP000 GBP000 GBP000
Profit for the
period 860 898 1,768
----------------------------------- --------------------------------- -------------------------------
Other
comprehensive
income /
(expense)
Items that
will not be
reclassified
to profit or
loss - - -
Actuarial gain
/ (loss) on
pension
scheme (396) 294 349
Tax on
actuarial
gain / (loss) 65 (57) (77)
Other
comprehensive
income /
(expense) net
of tax (331) 237 272
----------------------------------- --------------------------------- -------------------------------
Total
comprehensive
income for
the period 529 1,135 2,040
=================================== ================================= ===============================
Attributable
to:
- Equity
holders of
the parent 529 1,135 2,040
=================================== ================================= ===============================
CONSOLIDATED
BALANCE SHEET
As at As at As at
31 March 30 Sept
31 March 18 17 17
Unaudited Unaudited Audited
GBP000 GBP000 GBP000
Non-current
assets
Intangible
assets 1,187 1,190 1,185
Property, plant
and equipment 6,843 6,686 6,851
Retirement
benefits 983 1,195 1,311
9,013 9,071 9,347
---------------------------------- --------------------------------- -----------------------------
Current assets
Inventories 4,821 3,593 4,417
Trade and other
receivables 6,041 4,721 5,054
Cash and cash
equivalents 44 138 119
---------------------------------- --------------------------------- -----------------------------
10,905 8,452 9,590
---------------------------------- --------------------------------- -----------------------------
Total assets 19,917 17,523 18,937
Current
liabilities
Bank overdraft (817) (640) (216)
Bank loans and
other
borrowings (251) (265) (277)
Current tax
payable (188) (199) (64)
Trade and other
payables (4,947) (4,061) (4,969)
(6,203) (5,165) (5,526)
---------------------------------- --------------------------------- -----------------------------
Non-current
liabilities
Bank loans and
other
borrowings (2,420) (2,327) (2,379)
Deferred tax
liabilities (159) (251) (221)
Other payables (90) - (90)
(2,669) (2,578) (2,690)
---------------------------------- --------------------------------- -----------------------------
Total
liabilities (8,871) (7,743) (8,216)
---------------------------------- --------------------------------- -----------------------------
Net assets 11,046 9,780 10,721
================================== ================================= =============================
Equity
Share capital 1,238 1,231 1,238
Share premium
account 628 610 628
Un-issued
shares reserve 134 183 134
Merger reserve 230 230 230
Retained
earnings 8,816 7,526 8,491
Equity
attributable
to
shareholders
of the parent 11,046 9,780 10,721
================================== ================================= =============================
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
6 months to 6 months to Year to
31 March 2018 31 March 2017 30 Sept 2017
Unaudited Unaudited Audited
GBP000 GBP000 GBP000
Opening equity 10,721 8,689 8,689
Total
comprehensive
income 529 1,135 2,040
Transactions with
owners:
Dividends (204) (185) (315)
Proceeds from
issue of shares - 141 166
Tax benefit on
share based
payments - - 141
Closing equity 11,046 9,780 10,721
================================== ================================ ===========================
CONSOLIDATED
CASH FLOW
STATEMENT
6 months
6 months to to Year to
31 March 31 March 30 Sept
2018 2017 2017
Unaudited Unaudited Audited
GBP000 GBP000 GBP000
Profit before
tax 987 976 1,914
Finance costs 43 32 75
Finance
income (18) (10) (21)
Operating
profit 1,012 998 1,968
Adjustments
for:
Depreciation 319 230 543
Amortisation
of
intangible
assets 6 17 36
(Gain) on
sale of
property,
plant
and
equipment (8) (341) (321)
Loan
arrangement
fees - 4 4
1,329 908 2,230
Movements in
working
capital:
Change in
inventories (404) (563) (1,387)
Change in
trade and
other
receivables (987) (43) (376)
Change in
trade and
other
payables (22) 259 1,237
Cash
generated
from
operations (83) 561 1,704
Income taxes
paid - - (112)
Retirement
benefits (50) (50) (100)
Net cash from
operating
activities (133) 511 1,492
----------------------------------- --------------------------------- ------------------------------
Purchase of
property,
plant and
equipment (173) (1,354) (1,643)
Proceeds from
sale of
property,
plant and
equipment 8 524 525
Capitalised
development
expenditure (8) (13) (27)
Net cash
(used in) /
from
investing
activities (173) (843) (1,145)
----------------------------------- --------------------------------- ------------------------------
Drawdown of
bank loans - 500 500
Repayment of
bank loans (98) (603) (702)
Repayment of
obligations
under
finance
leases (53) (27) (81)
Interest paid (15) (7) (23)
Proceeds from
issue of
share
capital - 141 166
Dividends
paid (204) (185) (315)
Net cash
(used in) /
from
financing
activities (370) (181) (455)
----------------------------------- --------------------------------- ------------------------------
Net
(decrease) /
increase in
cash and
cash
equivalents (676) (513) (108)
Cash and cash
equivalents
at
start of the
period (97) 11 11
Cash and cash
equivalents
at
end of the
period (773) (502) (97)
=================================== ================================= ==============================
Reconciliation of
cash and cash
equivalents
6 months
6 months to to Year to
31 March 31 March 30 Sept
2018 2017 2017
Unaudited Unaudited Audited
GBP000 GBP000 GBP000
Cash and cash
equivalents in
current assets 44 138 119
Bank overdraft in
current
liabilities (817) (640) (216)
Cash and cash
equivalents at
end of the period (773) (502) (97)
================================= =============================== =============================
NOTES
1 - BASIS OF PREPARATION
These interim consolidated financial statements are for the six
months ended 31 March 2018. They do not include all of the
information required for full annual financial statements and
should be read in conjunction with the consolidated financial
statements of the Group, for the year ended 30 September 2017.
They have been prepared in accordance with International
Financial Reporting Standards as adopted by the EU and applicable
law (IFRS) and in accordance with the provisions of the Companies
Act 2006 applicable to companies applying IFRS. These financial
statements have been prepared under the historical cost convention
with the exception of certain items which are measured at fair
value.
These consolidated interim financial statements have been
prepared in accordance with the accounting policies adopted in the
last annual financial statements for the year to 30 September 2017.
The accounting policies have been applied consistently throughout
the Group for the purposes of preparation of these interim
financial statements and are expected to be followed throughout the
year ending 30 September 2018.
2 - EARNINGS PER SHARE
The calculations of earnings per share are based upon the profit
after tax attributable to ordinary equity shareholders and the
weighted average number of ordinary shares in issue during the
period. Details are as follows:
6 months
6 months to to Year to
31 March 31 March 30 Sept
2018 2017 2017
Unaudited Unaudited Audited
Profit for the period
- GBP000 860 898 1,768
-------------------------------- ------------------------------ ---------------------------
Weighted average
number of ordinary
shares in issue
during the period
(million) 12.377 12.186 12.276
Dilutive effect of
share options 0.831 0.995 0.903
Number of shares for
diluted
earnings per share 13.208 13.181 13.179
================================ ============================== ===========================
Basic earnings per
share 6.95p 7.37p 14.40p
Diluted earnings per
share 6.51p 6.81p 13.42p
3 - ANALYSIS OF NET DEBT
Finance Cash and
Bank loans lease obligations cash equivalents Net debt
GBP000 GBP000 GBP000 GBP000
At 1 October
2017 2,311 345 97 2,753
New finance
lease
obligations - 138 - 138
Draw down of
bank loans - - - -
Interest and
arrangement
fees 28 - - 28
Repayment of
borrowings (98) (53) 151 -
Cash
absorbed - - 525 525
At 31 March
2018 2,241 430 773 3,444
========================== ============================== ============================== =========================
4 - INFORMATION
LPA Group plc is the Group's ultimate parent company. It is
incorporated in England and Wales and domiciled in the UK. The
address of LPA Group plc's registered office, which is also its
principal place of business, is Light & Power House, Shire
Hill, Saffron Walden, CB11 3AQ. LPA Group plc's shares are quoted
on the AIM market of the London Stock Exchange.
LPA Group plc's consolidated interim financial statements are
presented in Pounds Sterling (GBP000), which is also the functional
currency of the parent company. These consolidated interim
financial statements have been approved for issue by the Board of
Directors on 21 June 2018. The financial information for the year
ended 30 September 2017 set out in this interim report does not
constitute statutory accounts as defined in Section 434 of the
Companies Act 2006. The Group's statutory financial statements for
the year ended 30 September 2017 have been filed with the Registrar
of Companies. The auditor's report on those financial statements
was unqualified and did not contain statements under Section 498(2)
or Section 498(3) of the Companies Act 2006.
Summarised copies of this Interim Report are being sent to
shareholders. Copies are also available from the Company's
registered office address as above, or are available on the
Company's website (www.lpa-group.com).
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR EAKKEAFPPEFF
(END) Dow Jones Newswires
June 21, 2018 02:00 ET (06:00 GMT)
Lpa (LSE:LPA)
Historical Stock Chart
From Mar 2024 to Apr 2024
Lpa (LSE:LPA)
Historical Stock Chart
From Apr 2023 to Apr 2024