TIDMLTHM
RNS Number : 1274V
Latham(James) PLC
30 November 2023
James Latham plc
("James Latham" or the "Company")
HALF YEARLY RESULTS FOR THE PERIODED 30 SEPTEMBER 2023
Chairman's statement
Unaudited results for the six months trading to 30 September
2023
Revenue for the six months ended 30 September 2023 was
GBP190.9m, down 10.3% on GBP212.8m for the same period last year.
Cost prices on both timber and panels have slowly fallen throughout
the first half of the year but they are now relatively stable and
there are currently few signs of price weakness. Sales volumes have
also remained at similar levels to the same period last year. We
have seen a change in the product mix of our sales, with some of
our customers moving to cheaper alternative products to counter the
effect of high inflation, which is the main reason for the
reduction in revenues.
Gross profit percentage, which includes warehouse costs, for the
six month period ended 30 September 2023 was 16.8% compared with
19.4% in the comparative six months. Increased competition in
weaker market conditions has led to the gross profit percentage
dipping slightly below the long term average of 17.5%.
Overheads have been well controlled during the six months, and
despite the stubbornly high inflation rates, the overheads are
slightly lower than the same period last year.
Operating profit was GBP14.5m, down GBP9m compared with GBP23.5m
profit for the same period last year. This reduction was
anticipated as we return to normal trading conditions after the
exceptional results of the last two years. Profit before tax was
GBP16.4m compared with GBP23.7m for the same period last year. The
tax charge of GBP4.0m represents an effective rate of 24.6%, and
reflects the increase in the UK basic rate of corporation tax.
Earnings per ordinary share were 61.5p compared with 95.6 p for the
same period last year.
As at 30 September 2023 net assets are GBP203.8m (2022:
GBP180.5m). Inventory levels of GBP66.1m have reduced from GBP74.6m
at the same period last year as supply chains have stabilised.
Trade and other receivables are also slightly down with bad debts
remaining at a low figure. Cash and cash equivalents have increased
to GBP66.0m (2022: GBP36.9m) and we continue to take advantage of
additional early settlement discount opportunities with our
suppliers as well as generating improved interest receipts.
There is a surplus in the IAS19 valuation of the pension scheme
at 30 September 2023 of GBP11.2m compared with GBP7.2m in the same
period last year. The triennial valuation at 31 March 2023 has been
completed, and is showing a surplus of GBP10.0m and a funding level
of 118%. This strong position has enabled the trustees to derisk
their investments to reduce the volatility of the IAS19 valuation.
In addition the deficit recovery funding payment of GBP3m a year
will cease from 1 December 2023.
Interim dividend
The Board has declared an increased interim dividend of 7.75p
per Ordinary Share (2022: 7.25p). The dividend is payable on 26
January 2024 to ordinary shareholders on the Company's Register at
close of business on 5 January 2024. The ex-dividend date will be 4
January 2024.
Current and future trading
The second half of 2023/24 has started with similar volumes to
the previous six month period to 30 September 2023, with similar
margins. Cost prices of the majority of our products are stable at
the moment, but we are mindful that the market in continental
Europe is quiet at the moment, with European Panel manufacturers
exporting more product to the UK, where the market is currently
more robust. There remain significant cost pressures on all our
manufacturers, so we expect any further price weakness to be
limited.
Our customers still have reasonable order books, but there are
still indications that some contracts are being postponed rather
than cancelled. We are seeing a continued shift in our market
sectors to more lower value products, where we have gained market
share, and we expect this trend to continue as customers look for
more cost effective solutions.
The strength of our customer base and the diverse markets in
which we operate will help us during the more challenging
macroeconomic climate that we are all facing.
The board anticipates that the results for the year ended 31
March 2024 will be in line with market expectations.
Nick Latham
Chairman
30 November 2023
This announcement contains inside information for the purposes
of Article 7 of the UK version of Regulation (EU) No 596/2014 which
is part of UK law by virtue of the European Union (Withdrawal) Act
2018, as amended.
For further information please visit www.lathamtimber.co.uk or
contact:
James Latham plc Tel: 01442 849 100
Nick Latham, Chairman
David Dunmow, Finance Director
SP Angel Corporate Finance LLP
Matthew Johnson / Charlie Bouverat (Corporate Tel: 0203 470 0470
Finance)
Abigail Wayne (Corporate Broking)
JAMES LATHAM PLC
CONSOLIDATED INCOME STATEMENT
For the six months to 30 September 2023
Six months Six months Year to
to 30 Sept. to 30 Sept. 31 March
2023 unaudited 2022 unaudited 2023 audited
GBP000 GBP000 GBP000
Revenue 190,882 212,797 408,370
Cost of sales (including warehouse costs) (158,832) (171,443) (328,361)
Gross profit 32,050 41,354 80,009
Selling and distribution costs (12,033) (12,147) (24,214)
Administrative expenses (5,558) (5,680) (12,097)
Operating profit 14,459 23,527 43,698
Finance income 2,063 231 1,071
Finance costs (126) (98) (258)
Profit before tax 16,396 23,660 44,511
Tax expense (4,030) (4,606) (8,593)
Profit after tax attributable to owners
of the parent company 12,366 19,054 35,918
Earnings per ordinary share (basic) 61.5p 95.6p 179.5p
Earnings per ordinary share (diluted) 61.4p 95.2p 179.2p
============================================== ================ ================ ==============
All results relate to continuing operations.
JAMES LATHAM PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE
INCOME
For the six months to 30 September 2023
Six months Six months Year to
to 30 Sept. to 30 Sept. 31 March
2023 unaudited 2022 unaudited 2023 audited
GBP000 GBP000 GBP000
---------------------------------------------- ---------------- ---------------- --------------
Profit after tax 12,366 19,054 35,918
Other Comprehensive income
Actuarial gains on defined benefit pension
scheme 1,982 3,242 1,407
Deferred tax relating to components of other
comprehensive income (495) (1,080) (632)
Foreign translation (charge)/credit (64) 492 233
---------------------------------------------- ---------------- ---------------- --------------
Other comprehensive income for the period,
net of tax 1,423 2,654 1,008
---------------------------------------------- ---------------- ---------------- --------------
Total comprehensive income, attributable
to owners of the parent company 13,789 21,708 36,926
============================================== ================ ================ ==============
JAMES LATHAM PLC
CONSOLIDATED BALANCE SHEET
At 30 September 2023
As at As at 30 As at 31
30 Sept. Sept. 2022 March 2023
2023 unaudited unaudited audited
GBP000 GBP000 GBP000
ASSETS
Non-current assets
Goodwill 1,181 1,363 1,193
Intangible assets 1,236 1,403 1,319
Property, plant and equipment 37,841 37,278 37,440
Right-of-use-asset 5,438 3,995 5,817
Retirement benefit surplus 11,212 7,318 7,221
Deferred tax asset 53 134 -
Total non-current assets 56,961 51,491 52,990
Current assets
Inventories 66,052 74,588 67,489
Trade and other receivables 64,220 69,380 66,782
Cash and cash equivalents 65,958 36,939 62,609
Tax receivable 13 - 490
Total current assets 196,243 180,907 197,370
Total assets 253,204 232,398 250,360
------------------------------------------- ---------------- ------------ ------------
Current liabilities
Lease liabilities 879 1,429 879
Trade and other payables 35,013 40,471 41,066
Current tax payable - 268 -
------------------------------------------- ---------------- ------------ ------------
Total current liabilities 35,892 42,168 41,945
Non-current liabilities
Interest bearing loans and borrowings 587 592 592
Lease liabilities 4,806 2,753 5,130
Deferred tax liabilities 8,124 6,369 7,118
------------------------------------------- ---------------- ------------ ------------
Total non-current liabilities 13,517 9,714 12,840
Total liabilities 49,409 51,882 54,785
Net assets 203,795 180,516 195,575
=========================================== ================ ============ ============
Capital and reserves
Issued capital 5,040 5,040 5,040
Share-based payment reserve 152 438 124
Own shares - (708) -
Capital reserve 398 398 398
Retained earnings 198,205 175,348 190,013
------------------------------------------- ---------------- ------------ ------------
Total equity attributable to shareholders
of the parent company 203,795 180,516 195,575
=========================================== ================ ============ ============
JAMES LATHAM PLC
CONSOLIDATED CASH FLOW STATEMENT
For the six months to 30 September 2023
Six months Six months Year to
to 30 Sept to 30 Sept 31 March
2023 unaudited 2022 unaudited 2023 audited
GBP000 GBP000 GBP000
-------------------------------------------------- ---------------- ---------------- --------------
Net cash flow from operating activities
Cash generated from operations 13,197 11,744 43,864
Interest paid (25) (26) (53)
Income tax paid (3,094) (4,043) (7,498)
Net cash inflow from operating activities 10,078 7,675 36,313
-------------------------------------------------- ---------------- ---------------- --------------
Cash flows from investing activities
Interest received and similar income 1,697 127 822
Purchase of property, plant and equipment (2,233) (1,782) (3,304)
Proceeds from sale of property, plant and
equipment 27 56 72
Net cash outflow from investing activities (509) (1,599) (2,410)
-------------------------------------------------- ---------------- ---------------- --------------
Cash flows before financing activities
Lease liability payments (425) (787) (1,499)
Equity dividends paid (5,789) (5,380) (6,825)
Purchase of own shares (6) - -
Cash outflow from financing activities (6,220) (6,167) (8,324)
-------------------------------------------------- ---------------- ---------------- --------------
Increase/(decrease) in cash and cash equivalents
for the period 3,349 (91) 25,579
==================================================
Cash and cash equivalents at beginning
of the period 62,609 37,030 37,030
Cash and cash equivalents at end of the
period 65,958 36,939 62,609
================================================== ================ ================ ==============
JAMES LATHAM PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Attributable to owners of the
parent company
Share-based
Issued payment Own Capital Retained Total
capital reserve shares reserve earnings equity
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
As at 1 April 2022 (audited) 5,040 387 (873) 398 159,019 163,971
Profit for the period - - - - 19,054 19,054
Other comprehensive income:
Actuarial gain on defined
benefit
pension scheme - - - - 3,242 3,242
Deferred tax relating to
components
of other comprehensive income - - - - (1,080) (1,080)
Foreign translation credit - - - - 492 492
--------------------------------- ------------ ---------------- ----------- ----------- ------------- ----------
Total comprehensive income for
the period - - - - 21,708 21,708
Transaction with owners:
Dividends - - - - (5,379) (5,379)
Deferred tax on share options - (37) - - - (37)
Change in investment in ESOP
shares - - 165 - - 165
Share-based payment expense - 88 - - - 88
--------------------------------- ------------ ---------------- ----------- ----------- ------------- ----------
Total transactions with owners - 51 165 - (5,379) (5,163)
--------------------------------- ------------ ---------------- ----------- ----------- ------------- ----------
Balance at 30 September 2022
(unaudited) 5,040 438 (708) 398 175,348 180,516
Profit for the period - - - - 16,864 16,864
Other comprehensive income:
Actuarial loss on defined
benefit
pension scheme - - - - (1,835) (1,835)
Deferred tax relating to
components
of other comprehensive income - - - - 448 448
Foreign translation charge - - - - (259) (259)
--------------------------------- ------------ ---------------- ----------- ----------- ------------- ----------
Total comprehensive income for
the period - - - - 15,218 15,218
Transactions with owners:
Dividends - - - - (1,446) (1,446)
Exercise of options - (386) 1,397 - 369 1,380
Deferred tax on share options - (22) - - - (22)
Transfer to retained earnings - - (524) - 524 -
Change in investment in ESOP
shares - - (165) - - (165)
Share-based payment expense - 94 - - - 94
--------------------------------- ------------ ---------------- ----------- ----------- ------------- ----------
Total transactions with owners - (314) 708 - (553) (159)
--------------------------------- ------------ ---------------- ----------- ----------- ------------- ----------
Balance at 31 March 2023
(audited) 5,040 124 - 398 190,013 195,575
Profit for the period - - - - 12,366 12,366
Other comprehensive income:
Actuarial gain on defined
benefit
pension scheme - - - - 1,982 1,982
Deferred tax relating to
components
of other comprehensive income - - - - (495) (495)
Foreign translation charge - - - - (64) (64)
Total comprehensive income for
the period - - - - 13,789 13,789
Transactions with owners:
Dividends - - - - (5,789) (5,789)
Exercise of options - (8) - - 8 -
Deferred tax on share options - (1) - - - (1)
Change in investment in ESOP
shares - - - 184 184
Share-based payment expense - 37 - - - 37
--------------------------------- ------------ ---------------- ----------- ----------- ------------- ----------
Total transactions with owners - 28 - - (5,597) (5,569)
--------------------------------- ------------ ---------------- ----------- ----------- ------------- ----------
Balance at 30 September 2023
(unaudited) 5,040 152 - 398 198,205 203,795
================================= ============ ================ =========== =========== ============= ==========
JAMES LATHAM PLC
NOTES TO THE HALF YEARLY REPORT
1. The results presented in this report are unaudited and they have
been prepared in accordance with the recognition and measurement principles
of International Accounting Standards in conformity with the requirements
of the Companies Act 2006 and on the basis of the accounting policies
expected to be used in the financial statements for the year ending
31 March 2024. The half yearly report does not include all the disclosures
that would be required for full compliance with IFRS. The figures
for the year ended 31 March 2023 are extracted from the statutory
accounts of the group for that period.
2. The directors propose an interim dividend of 7.75p per ordinary
share which will absorb GBP1,560,000 (2022: 7.25p absorbing GBP1,445,000),
payable on 26 January 2024 to shareholders on the Company's Register
at the close of business on 5 January 2024. The ex-dividend date is
4 January 2024.
3. This half yearly report does not constitute statutory financial
accounts within the meaning of section 434 of the Companies Act 2006.
The statutory accounts for the year ended 31 March 2023 were filed
with the Registrar of Companies. The audit report on those financial
statements was not qualified and did not contain a reference to any
matters to which the auditor drew attention by way of emphasis without
qualifying the report and did not contain a statement under section
498 (2) or (3) of the Companies Act 2006. The half yearly report has
not been audited by the Company's auditor.
4. Earnings per ordinary share is calculated by dividing the net profit
for the period attributable to ordinary shareholders by the weighted
average number of ordinary shares outstanding during the period.
Six months Six months Year to
to 30 Sept to 30 Sept 31 March
2023 unaudited 2022 unaudited 2023 audited
GBP000 GBP000 GBP000
Net profit attributable to ordinary shareholders 12,366 19,054 35,918
Number '000 Number '000 Number
'000
Weighted average share capital 20,123 19,926 20,009
Add: diluted effect of share capital options
issued 24 95 31
Weighted average share capital for diluted
earnings per ordinary share calculation 20,147 20,021 20,040
---------------- ---------------- --------------
5. Net cash flow from operating activities
Six months Six months Year to
to 30 Sept to 30 Sept 31 March
2023 unaudited 2022 unaudited 2023 audited
GBP000 GBP000 GBP000
Profit before tax 16,396 23,660 44,511
Adjustment for finance income and expenditure (1,937) (133) (813)
Depreciation and amortisation 2,272 2,091 4,173
Impairment - - 179
Loss/(profit) on disposal of property,
plant and equipment 7 (51) (46)
Decrease/(increase) in inventories 1,437 (358) 6,741
Decrease/(increase) in receivables 2,562 (1,048) 1,550
Decrease in payables (5,934) (9,652) (8,167)
Retirement benefits non cash amounts (1,643) (2,853) (4,446)
Share-based payments non cash amounts 37 88 182
Cash generated from operations 13,197 11,744 43,864
---------------- ---------------- --------------
6. Copies of this statement will be posted on our website, www.lathamtimber.co.uk/investors
A copy can be emailed or posted upon application to the Company Secretary,
James Latham plc, Unit C2, Breakspear Park, Breakspear Way, Hempstead,
Herts, HP2 4TZ, or by email to plc@lathams.co.uk
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