TIDMLSC
RNS Number : 4637D
London Security PLC
27 April 2017
London Security plc
Final Results for the Year Ended 31 December 2016
CHAIRMAN'S STATEMENT
FINANCIAL HIGHLIGHTS
Financial highlights of the audited results for the year ended
31 December 2016 compared with the year ended 31 December 2015 are
as follows:
-- revenue of GBP114.8 million (2015: GBP101.2 million);
-- operating profit before depreciation and amortisation of
GBP26.3 million (2015: GBP23.2 million);
-- operating profit of GBP20.9 million (2015: GBP18.5 million);
-- profit after income tax of GBP13.8 million (2015: GBP12.3 million); and
-- a dividend per share of GBP0.80 (2015: GBP0.68).
TRADING REVIEW
The financial highlights illustrate that the Group's revenue
increased by GBP13.6 million (13.4%) to GBP114.8 million. However,
these results are impacted by the movement in the Euro to Sterling
average exchange rate, which has decreased from 1.38 to 1.23. This
movement in exchange rate had a favourable effect of GBP9.8 million
on reported revenue. If the 2016 results had been translated at
2015 rates, revenue would have been GBP105.0 million instead of
GBP114.8 million (increase of 3.8% on prior year).
Operating profit increased by GBP2.4 million (13.0%) to GBP20.9
million. Adjusting for the change in the exchange rate on the same
basis as above, operating profit would have been GBP18.7 million
instead of GBP20.9 million (increase of 1.1%). A more detailed
review of this year's performance is given in the Financial Review
and the Strategic Report.
ACQUISITIONS
It remains a principal aim of the Group to grow through
acquisition. Acquisitions are being sought throughout Europe and
the Group will invest at prices where an adequate return is
envisaged by the Board. In the year under review the Group has
consolidated its presence in Belgium, the Netherlands and the UK
with the acquisitions of service contracts from 15 smaller well
established businesses for integration into the Group's existing
subsidiaries. In addition, with the acquisition of One Protect in
France and Ludwig in Germany the Group has expanded its business
into two new countries.
MANAGEMENT AND STAFF
2016 was a year in which the staff performed well and, on your
behalf, I would like to express thanks and appreciation for their
contribution. The Group recognises that we can only achieve our
aims with talented and dedicated colleagues who provide outstanding
customer service in every area of the business.
DIVIDS
A final dividend in respect of 2015 of GBP0.40 per ordinary
share was paid to shareholders on 8 July 2016. An interim dividend
in respect of 2016 of GBP0.40 per ordinary share was paid to
shareholders on 8 December 2016. The Board is recommending the
payment of a final dividend in respect of 2016 of GBP0.40 per
ordinary share to be paid on 5 July 2017 to shareholders on the
register on 9 June 2017. The shares will be marked ex-dividend on 8
June 2017.
FUTURE PROSPECTS
We are experiencing increased competition in our core market and
customer care is becoming increasingly important. To retain our
valued customers we need to strive to serve them at the highest
possible level. We do not expect the economic environment to get
any easier in 2017. Nonetheless your Group remains in a strong
position and will continue to focus on meeting the needs of our
customers and our shareholders.
ANNUAL GENERAL MEETING
The Annual General Meeting will be held at 2 Eaton Gate, London
SW1W 9BJ on 21 June 2017 at 2 pm. You will find enclosed a form of
proxy for use at that Meeting which you are requested to complete
and return in accordance with the instructions on the form. Your
Directors look forward to meeting you at that time.
J.G. Murray
Chairman
27 April 2017
Consolidated income statement
for the year ended 31 December 2016
2016 2015
Note GBP'000 GBP'000
------------------------------------------- ---- -------- --------
Revenue 114,845 101,165
Cost of sales (23,638) (20,373)
------------------------------------------- ---- -------- --------
Gross profit 91,207 80,792
Distribution costs (42,191) (37,304)
Administrative expenses (28,154) (25,010)
------------------------------------------- ---- -------- --------
Operating profit 20,862 18,478
------------------------------------------- ---- -------- --------
EBITDA* 26,321 23,191
Depreciation and amortisation (5,459) (4,713)
-------------------------------------------- ---- -------- ----------
Operating profit 20,862 18,478
-------------------------------------------- ---- -------- ----------
Finance income 176 179
Finance costs (433) (446)
------------------------------------------- ---- -------- --------
Finance costs - net (257) (267)
Profit before income tax 20,605 18,211
Income tax expense (6,822) (5,942)
------------------------------------------- ---- -------- --------
Profit for the year attributable to equity
shareholders of the Company 13,783 12,269
------------------------------------------- ---- -------- --------
Earnings per share
Basic and diluted 1 112.4p 100.1p
------------------------------------------- ---- -------- --------
* Earnings before interest, tax, depreciation and
amortisation.
The above results are all as a result of continuing
operations.
Consolidated statement of comprehensive income
for the year ended 31 December 2016
2016 2015
GBP'000 GBP'000
------------------------------------------------- ------- -------
Profit for the financial year 13,783 12,269
-------------------------------------------------- ------- -------
Other comprehensive income/(expense):
Items that may be reclassified subsequently
to profit or loss:
- currency translation differences on
foreign currency net investments 4,441 (1,168)
Items that will not be reclassified subsequently
to profit or loss:
- actuarial gain/(loss) recognised in
the Nu-Swift pension scheme 263 (406)
- movement on deferred tax relating to
Nu-Swift pension scheme surplus (92) 142
- actuarial (loss)/gain recognised in
the Ansul pension scheme (200) 163
- movement on deferred tax relating to
Ansul pension scheme deficit 61 (56)
-------------------------------------------------- ------- -------
Other comprehensive income/(expense) for
the year, net of tax 4,473 (1,325)
-------------------------------------------------- ------- -------
Total comprehensive income for the year 18,256 10,944
-------------------------------------------------- ------- -------
Consolidated statement of changes in equity
for the year ended 31 December 2016
Share Capital
Share premium redemption Merger Other Retained Total
capital account reserve reserve reserve earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------- ----------------- ------- ---------- ------- ------- -------- -------
At 1 January 2015 123 344 1 2,033 3,758 79,157 85,416
Total comprehensive income
for the year
Profit for the financial
year - - - - - 12,269 12,269
Other comprehensive (expense)/income:
- exchange adjustments - - - - (1,168) - (1,168)
- actuarial loss on pension
schemes - - - - - (243) (243)
- net movement on deferred
tax relating to pension
asset - - - - - 86 86
------------------------------------- ----------------- ------- ---------- ------- ------- -------- -------
Total comprehensive income
for the year - - - - (1,168) 12,112 10,944
------------------------------------- ----------------- ------- ---------- ------- ------- -------- -------
Contributions by and
distributions to owners
of the Company:
- dividends - - - - - (8,337) (8,337)
------------------------------------- ----------------- ------- ---------- ------- ------- -------- -------
Total contributions by
and distributions to
owners of the Company - - - - - (8,337) (8,337)
------------------------------------- ----------------- ------- ---------- ------- ------- -------- -------
At 31 December 2015 and
1 January 2016 123 344 1 2,033 2,590 82,932 88,023
------------------------------------- ----------------- ------- ---------- ------- ------- -------- -------
Total comprehensive income
for the year
Profit for the financial
year - - - - - 13,783 13,783
Other comprehensive income/(expense):
- exchange adjustments - - - - 4,441 - 4,441
- actuarial gain on pension
schemes - - - - - 63 63
- net movement on deferred
tax relating to pension
asset - - - - - (31) (31)
------------------------------------- ----------------- ------- ---------- ------- ------- -------- -------
Total comprehensive income
for the year - - - - 4,441 13,815 18,256
------------------------------------- ----------------- ------- ---------- ------- ------- -------- -------
Contributions by and
distributions to owners
of the Company:
- dividends - - - - - (9,808) (9,808)
- release of accrual
for unclaimed dividends - - - - - 82 82
------------------------------------- ----------------- ------- ---------- ------- ------- -------- -------
Total contributions by
and distributions to
owners of the Company - - - - - (9,726) (9,726)
------------------------------------- ----------------- ------- ---------- ------- ------- -------- -------
At 31 December 2016 123 344 1 2,033 7,031 87,021 96,553
------------------------------------- ----------------- ------- ---------- ------- ------- -------- -------
The merger reserve is not a distributable reserve. The other
reserve relates entirely to the effects of changes in foreign
currency exchange rates.
Consolidated statement of financial position
as at 31 December 2016
2016 2015
GBP'000 GBP'000
-------------------------------------- -------- --------
Assets
Non-current assets
Property, plant and equipment 10,937 9,789
Intangible assets 62,749 60,594
Deferred tax asset 919 690
Retirement benefit surplus 3,574 3,196
--------------------------------------- -------- --------
78,179 74,269
-------------------------------------- -------- --------
Current assets
Inventories 11,095 9,689
Trade and other receivables 23,138 19,901
Cash and cash equivalents 22,602 19,736
--------------------------------------- -------- --------
56,835 49,326
-------------------------------------- -------- --------
Total assets 135,014 123,595
--------------------------------------- -------- --------
Liabilities
Current liabilities
Trade and other payables (19,344) (16,666)
Income tax liabilities (1,180) (1,335)
Borrowings (1,870) (1,679)
Provision for liabilities and charges (35) (35)
--------------------------------------- -------- --------
(22,429) (19,715)
-------------------------------------- -------- --------
Non-current liabilities
Trade and other payables (957) (669)
Borrowings (10,789) (11,417)
Derivative financial instruments (172) (190)
Deferred tax liabilities (1,705) (1,696)
Retirement benefit obligations (2,279) (1,684)
Provision for liabilities and charges (130) (201)
--------------------------------------- -------- --------
(16,032) (15,857)
-------------------------------------- -------- --------
Total liabilities (38,461) (35,572)
--------------------------------------- -------- --------
Net assets 96,553 88,023
--------------------------------------- -------- --------
Shareholders' equity
Ordinary shares 123 123
Share premium 344 344
Capital redemption reserve 1 1
Merger reserve 2,033 2,033
Other reserves 7,031 2,590
Retained earnings 87,021 82,932
--------------------------------------- -------- --------
Total shareholders' equity 96,553 88,023
--------------------------------------- -------- --------
Consolidated statement of cash flow
for the year ended 31 December 2016
2016 2015
GBP'000 GBP'000
--------------------------------------------- -------- --------
Cash flows from operating activities
Cash generated from operations 26,059 20,215
Interest paid (408) (425)
Income tax paid (7,213) (5,889)
---------------------------------------------- -------- --------
Net cash generated from operating activities 18,438 13,901
---------------------------------------------- -------- --------
Cash flows from investing activities
Acquisition of subsidiary undertakings
(net of cash acquired) (2,222) (1,301)
Purchases of property, plant and equipment (2,774) (2,363)
Proceeds from sale of property, plant and
equipment 323 236
Purchases of intangible assets (1,662) (974)
Interest received 43 27
---------------------------------------------- -------- --------
Net cash used in investing activities (6,292) (4,375)
---------------------------------------------- -------- --------
Cash flows from financing activities
Repayments of borrowings (1,819) (1,663)
Dividends paid to Company's shareholders (9,726) (8,337)
---------------------------------------------- -------- --------
Net cash used in financing activities (11,545) (10,000)
---------------------------------------------- -------- --------
Effects of exchange rates on cash and cash
equivalents 2,265 (768)
---------------------------------------------- -------- --------
Net increase/(decrease) in cash in the
year 2,866 (1,242)
Cash and cash equivalents at the beginning
of the year 19,736 20,978
---------------------------------------------- -------- --------
Cash and cash equivalents at end of the
year 22,602 19,736
---------------------------------------------- -------- --------
Notes to the financial statements
for the year ended 31 December 2016
1 Earnings per share
The calculation of basic earnings per ordinary share ("EPS") is
based on the profit on ordinary activities after taxation of
GBP13,783,000 (2015: GBP12,269,000) and on 12,261,477 (2015:
12,261,477) ordinary shares, being the weighted average number of
ordinary shares in issue during the year.
For diluted EPS, the weighted average number of shares in issue
is adjusted to assume conversion of all dilutive potential ordinary
shares. There was no difference in the weighted average number of
shares used for the calculation of basic and diluted earnings per
share as there are no potentially dilutive shares outstanding.
2016 2015
-------------- --------------
GBP'000 Pence GBP'000 Pence
------------------------------------ ------- ----- ------- -----
Profit on ordinary activities after
taxation 13,783 112.4 12,269 100.1
------------------------------------ ------- ----- ------- -----
2 This preliminary announcement does not constitute the
Company's statutory accounts within the meaning of Section 434 of
the Companies Act 2006.
The results for the year ended 31 December 2016 have been
extracted from the full accounts of the Group for that year which
received an unqualified auditor's report and which have not yet
been delivered to the Registrar of Companies. The financial
information for the year ended 31 December 2015 is derived from the
statutory accounts for that year, which have been delivered to the
Registrar of Companies. The report of the auditor on those filed
accounts was unqualified. The accounts for the year ended 31
December 2016 and 31 December 2015 did not contain a statement
under s498 (1) to (4) of the Companies Act 2006 or under s237(1) to
(4) of the Companies Act 1985.
This preliminary announcement has been prepared in accordance
with International Financial Reporting Standards. The Group will
post its annual report and accounts to shareholders on 11 May 2016.
A copy of the annual report and accounts can be found on the
company's webpage (www.londonsecurity.org).
Enquiries
London Security plc
Richard Pollard Tel: 01422 372 852
Company Secretary
WH Ireland Limited
Chris Fielding Tel: 0207 220 1666
This information is provided by RNS
The company news service from the London Stock Exchange
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