TIDMPEG
RNS Number : 2474P
Petards Group PLC
30 September 2011
PETARDS GROUP PLC
INTERIM RESULTS ANNOUNCEMENT
Petards Group plc ('Petards'), the AIM quoted developer of
advanced security and surveillance systems, reports its interim
results for the six months to 30 June 2011.
Highlights
-- Revenues of GBP5.2m (2010: GBP5.3m)
-- Gross margins 40.5% (2010: 41.1%)
-- Profit before tax of GBP5,000 (2010: GBP115,000)
-- Basic and diluted earnings per share of 0.08p (2010 as
restated: 1.81p)
-- Net cash inflow from operating activities of GBP0.4m (2010:
GBP0.9m outflow)
-- Net debt of GBP1.8m (31 December 2010: GBP2.0m)
Commenting on the current outlook, Tim Wightman, Chairman,
said:
"Our order prospects remain encouraging with a number of large
UK programmes in both the rail and defence markets having now
obtained Government approval. However, the indicated delivery
schedules of trains on the prospective large rail projects mean
that those would be unlikely to have any material impact on
revenues until 2013.
In the shorter term, the increasing global economic uncertainty
over recent weeks leads us to be cautious over the timing of
customer order placement for our products although we believe those
orders will be secured. Despite this we expect year-on-year revenue
growth in 2011, although that growth will be lower than previously
expected."
Contacts:
Petards Group plc www.petards.com
Andy Wonnacott, Finance Director +44 (0) 191 420 3000
WH Ireland Limited www.wh-ireland.co.uk
Mike Coe / Marc Davies +44 (0) 117 945 3470
Chairman's Statement
Overview of the Results
The financial information contained within this interim report
is based upon the Group's unaudited results
for the six months to 30 June 2011.
In the first six months of 2011 the Group performed ahead of our
expectations albeit on lower than expected revenues. Profit before
tax for the period was GBP5,000 (2010: GBP115,000) on revenues of
GBP5.2m which remained at a similar level to those achieved for the
same period last year (2010: GBP5.3m). The profit after tax was
GBP5,000 (2010: GBP115,000) and both basic and diluted earnings per
share were 0.08p (2010 as restated: 1.81p).
Our revenues in June were approximately GBP0.3m lower than
expected due to a major fire at the end of May at one of our key
suppliers which impacted upon deliveries of our Transport products.
Alternative suppliers have been brought on stream and shipments of
product have now re-commenced. This interruption of supply has
necessitated some amendment to customers' build schedules which
will have some effect on our full year revenues of Transport
products.
Overall gross margins were 40.5% and while slightly lower than
those achieved in the same period last year (2010: 41.1%), were
higher than in the second half of 2010 and were ahead of our
expectations.
Cash generated from operations resulted in a GBP0.4m inflow in
the period (2010: GBP0.9m outflow) and the Group's net debt at 30
June 2011 was GBP1.8m (31 December 2010: GBP2.0m).
Operating Review
During the period we completed deliveries of the eyeTrain
equipment that is installed on the Electrostar EMU trains that
Bombardier are supplying to National Express East Anglia and the
first of those trains entered into service on Stansted Express
services. Initial deliveries were also made to Transys Projects and
Bombardier for the vehicle upgrades they are undertaking for
Southeastern Trains' fleet. Revenues from eyeTrain products were
slightly lower than the first six months of 2010 due to the impact
of the fire referred to above.
At this stage last year I commented upon the well publicised
deferral of the Intercity Express and Thameslink new train
programmes arising from the UK governments Comprehensive Spending
Review. We are pleased that during the first half of 2011 the
Department of Transport has given approval for both of those
programmes and confirmed Hitachi and Siemens as the preferred
bidders as these are important projects in which we would hope to
be involved.
Revenues from Provida products were similar to those experienced
in the first half of 2010 and continue to be affected by
significant budgetary pressures faced by UK police forces. Outside
of the UK we have been pleased to receive additional orders from
new partners we established last year and have identified a number
of strong prospects for the future.
While the overall defence market remains challenging, revenues
were up on the same period last year. Another positive was that in
June we received our first order for electronic countermeasures
systems since the Strategic Defence and Security Review was
undertaken. The upgrade forms part of the Puma helicopter life
extension programme and will integrate existing systems to
significantly improve the Defensive Aids Suite on the aircraft. We
are also encouraged by the announcement in July of the Government's
commitment to provide increased funding for the MoD's equipment
budget, as two of the programmes benefiting from this are the
upgrades to Warrior armoured vehicles and the acquisition of
Chinook helicopters, which are platforms to which we have
previously supplied equipment.
Research and Development
A key element of the Group's growth strategy is its commitment
to its product development programme and capitalised development
expenditure in the first six months of 2011 was GBP0.1m (2010:
GBP0.2m). We continue to invest in our products with the resources
available to us.
Capital Reorganisation
At the General Meeting held on 30 June 2011 a special resolution
was passed by shareholders to undertake a capital reorganisation,
details of which are set out in note 4 of this Interim Results
Statement.
Outlook
Our order prospects remain encouraging with a number of large UK
programmes in both the rail and defence markets having now obtained
Government approval. However, the indicated delivery schedules of
trains on the prospective large rail projects mean that those would
be unlikely to have any material impact on revenues until 2013.
In the shorter term, the increasing global economic uncertainty
over recent weeks leads us to be cautious over the timing of
customer order placement for our products although we believe those
orders will be secured. Despite this we expect year-on-year revenue
growth in 2011, although that growth will be lower than previously
expected.
Tim Wightman
29 September 2011
Condensed Consolidated Income Statement
for the six months ended 30 June 2011
Unaudited Unaudited Audited
6 months 6 months Year
ended ended ended
30 June 30 June 31 December
Note 2011 2010 2010
GBP000 GBP000 GBP000
Revenue 5,229 5,311 11,392
Cost of sales (3,112) (3,130) (7,069)
Gross profit 2,117 2,181 4,323
Administrative expenses (2,073) (2,077) (4,238)
Operating profit 44 104 85
Financial income 27 42 53
Financial expenses (66) (31) (85)
Profit before income
tax 5 115 53
Income tax 3 - - 311
Profit for the period attributable
to equity
holders of the company 5 115 364
Earnings per share
Basic and diluted (2010 5 0.08p 1.81p 5.72p
as restated)
The above results are derived from continuing operations.
Condensed Consolidated Statement of Comprehensive Income
for the six month period ended 30 June 2011
Unaudited Unaudited Audited
6 months 6 months Year
ended ended ended
30 June 30 June 31 December
2011 2010 2010
GBP000 GBP000 GBP000
Profit for period 5 115 364
Other comprehensive income
Currency translation on foreign
currency net investments 27 (83) (34)
Total comprehensive income for
the period 32 32 330
Condensed Consolidated Statement of Changes in Equity
for the six month period ended 30 June 2011
Currency
Share Share Retained translation Total
capital premium earnings differences equity
GBP000 GBP000 GBP000 GBP000 GBP000
Balance at 1 January
2010 (audited) 6,367 23,255 (29,724) (190) (292)
Profit for the period - - 115 - 115
Other comprehensive
income - - - (83) (83)
Total comprehensive
income for the
period - - 115 (83) 32
Equity-settled share
based payments - - 9 - 9
Balance at 30 June
2010 (unaudited) 6,367 23,255 (29,600) (273) (251)
Balance at 1 January
2010 (audited) 6,367 23,255 (29,724) (190) (292)
Profit for the year - - 364 - 364
Other comprehensive
income - - - (34) (34)
Total comprehensive
income for the year - - 364 (34) 330
Equity-settled share
based payments - - 18 - 18
Balance at 31
December 2010
(audited) 6,367 23,255 (29,342) (224) 56
Balance at 1 January
2011 (audited) 6,367 23,255 (29,342) (224) 56
Profit for the period - - 5 - 5
Other comprehensive
income - - - 27 27
Total comprehensive
income for the
period - - 5 27 32
Equity-settled share
based payments - - 7 - 7
Capital reorganisation
costs - (25) - - (25)
Balance at 30 June
2011 (unaudited) 6,367 23,230 (29,330) (197) 70
Condensed Consolidated Balance Sheet
at 30 June 2011
Unaudited Unaudited Audited
30 June 30 June 31 December
Note 2011 2010 2010
ASSETS GBP000 GBP000 GBP000
Non-current assets
Property, plant and equipment 149 237 182
Goodwill 401 401 401
Development costs 651 720 701
Deferred tax assets 790 356 790
1,991 1,714 2,074
Current assets
Inventories 1,030 1,706 911
Trade and other receivables 2,542 1,859 2,408
Cash and cash equivalents 3 21 -
3,575 3,586 3,319
Total assets 5,566 5,300 5,393
EQUITY AND LIABILITIES
Equity attributable to equity
holders of the parent
Share capital 4 6,367 6,367 6,367
Share premium 23,230 23,255 23,255
Currency translation reserve (197) (273) (224)
Retained earnings deficit (29,330) (29,600) (29,342)
Total equity 70 (251) 56
Non-current liabilities
Interest-bearing loans and
borrowings 295 799 550
Deferred tax liabilities 189 66 189
484 865 739
Current liabilities
Interest-bearing loans and
borrowings 1,471 1,119 1,453
Trade and other payables 3,541 3,567 3,145
5,012 4,686 4,598
Total liabilities 5,496 5,551 5,337
Total equity and liabilities 5,566 5,300 5,393
Condensed Consolidated Statement of Cash Flows
for the six month period ended 30 June 2011
Unaudited Unaudited Audited
6 months 6 months Year
ended ended ended
30 June 30 June 31 December
2011 2010 2010
GBP000 GBP000 GBP000
Cash flows from operating activities
Profit for the period 5 115 364
Adjustments for:
Depreciation 45 61 138
Amortisation of intangible assets 155 120 250
Financial income (27) (42) (53)
Financial expense 66 31 85
Profit on sale of property, plant
and equipment - - (4)
Equity settled share-based payment
expenses 7 9 18
Income tax credit - - (311)
Operating cash flows before movement in
working capital 251 294 487
Change in trade and other
receivables (134) 1,591 1,042
Change in inventories (119) (765) 30
Change in trade and other payables 450 (2,044) (2,408)
Cash generated from operations 448 (924) (849)
Interest received - 42 53
Interest paid (66) (31) (83)
Income tax received - 9 -
Net cash from operating activities 382 (904) (879)
Cash flows from investing activities
Sale of property, plant and
equipment - - 4
Acquisition of property, plant and
equipment (12) (31) (53)
Capitalised development expenditure (105) (219) (330)
Net cash outflow from investing activities (117) (250) (379)
Cash flows from financing activities
Repayment of bank borrowings (250) (201) (400)
Capital reorganisation expenses (25) - -
Net cash outflow from financing activities (275) (201) (400)
Net decrease in cash and cash
equivalents (10) (1,355) (1,658)
Cash and cash equivalents at start
of period (953) 701 701
Effect of exchange rate fluctuations
on cash held - 6 4
Cash and cash equivalents at end of period (963) (648) (953)
Cash and cash equivalents comprise:
Cash and cash equivalents 3 21 -
Overdraft (966) (669) (953)
(963) (648) (953)
Notes
1 General
The interim financial information set out in this statement for
the six months ended 30 June 2011 and the comparative figures for
the six months ended 30 June 2010 are unaudited. This financial
information does not constitute statutory accounts as defined in
Section 435 of the Companies Act 2006.
The comparative figures for the financial year ended 31 December
2010 are not the Company's statutory accounts for that financial
year. Those accounts have been reported on by the Company's
auditors and delivered to the Registrar of Companies. The report of
the auditors was (i) unqualified, (ii) did not include a reference
to any matters to which the auditors drew attention by way of
emphasis without qualifying their report, and (iii) did not contain
a statement under section 498(2) or (3) of the Companies Act
2006.
Copies of this interim statement will be available on the
Company's website (www.petards.com) and from the Company's
registered office at 390 Princesway, Team Valley, Gateshead, Tyne
and Wear, NE11 0TU.
2 Basis of preparation
This interim statement, which is neither audited nor reviewed,
has been prepared in accordance with the measurement and
recognition criteria of Adopted IFRSs. It does not include all the
information required for the full annual financial statements, and
should be read in conjunction with the financial statements of the
Group as at and for the year ended 31 December 2010. It does not
comply with IAS 34 'Interim Financial Reporting' as is permissible
under the rules of the AIM Market ("AIM").
The accounting policies applied in preparing these interim
financial statements are the same as those applied in the
preparation of the annual financial statements for the year ended
31 December 2010, as described in those financial statements other
than standards, amendments and interpretations which became
effective after 1 January 2011 and were adopted by the Group. These
have had no significant impact on the Group's profit for the period
or equity. The Board approved these interim financial statements on
29 September 2011.
3 Taxation
No provision for taxation has been made in the Condensed
Consolidated Income Statement for the six months to 30 June 2011
based on the estimated tax provision required for the year ending
31 December 2011. No provision was required in the six months to 30
June 2010.
4 Share capital
At 30 June At 30 June At 31 December
2011 2010 2010
No. No. No.
Number of shares in issue
- allotted, called up and
fully paid
New Ordinary Shares of 1p
each 6,367,100 - -
Deferred Shares of 1p each 630,342,900 - -
Ordinary Shares of 1p each - 636,710,000 636,710,000
636,710,000 636,710,000 636,710,000
GBP000 GBP000 GBP000
Number of shares in issue
- allotted, called up and
fully paid
New Ordinary Shares of 1p
each 64 - -
Deferred Shares of 1p each 6,303 - -
Ordinary Shares of 1p each - 6,367 6,367
6,367 6,367 6,367
On 30 June 2011 shareholders passed a resolution to reorganise
the Company's share capital. Under this reorganisation, the
Existing Ordinary Shares of 1p each were consolidated into New
Consolidated Ordinary Shares of GBP100 each on the basis of one New
Consolidated Ordinary Share for each 10,000 Existing Ordinary
Shares. Each New Consolidated Ordinary Share was then sub-divided
into 100 New Ordinary Shares of 1p each and 9,900 Deferred Shares
of 1p each.
Following the reorganisation, the Company's issued share capital
comprises 6,367,100 Ordinary Shares of 1p each and 630,342,900
Deferred Shares of 1p each. The Ordinary Shares have equal voting
rights. The Deferred Shares have no voting rights and are not
entitled to any dividends and have no other right or participation
in the profits of the Company.
5 Earnings per share
Basic earnings per share is calculated by dividing the profit
for the period attributable to the shareholders by the weighted
average number of shares in issue. The calculation of diluted
earnings per share assumes conversion of all potentially dilutive
ordinary shares, all of which arise from share options.
The calculation of earnings per share is based on the profit for
the period and on the weighted average number of ordinary shares
outstanding in the period.
The weighted average number of ordinary shares for the 6 months
ended 30 June 2010 and the year ended 31 December 2010 have been
restated to reflect the reorganisation of the Company's share
capital on 30 June 2011 described in note 4.
Unaudited Unaudited Audited
6 months 6 months Year
ended ended ended
30 June 30 June 31 December
2011 2010 2010
Earnings
Profit for the period (GBP000) 5 115 364
Number of shares
Weighted average number of ordinary
shares ('000) as restated 6,367 6,367 6,367
Weighted average number of ordinary
shares ('000) as originally stated 636,707 636,708
Earnings per share
Basic and diluted as originally stated
(pence) 0.02 0.06
Diluted earnings per share is identical to the basic earnings
per share. None of the share options are dilutive as the exercise
prices are higher than the average market price of the shares.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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