TIDMTXH
RNS Number : 0827W
Tex Holdings PLC
13 August 2020
TEX HOLDINGS PLC
INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
For the 6 months ended 30 June 2020
TEX HOLDINGS PLC
INDEX
Page
Chairman's Statement 2-3
Responsibility Statement 4
Consolidated Statement of Comprehensive Income 5
Consolidated Balance Sheet 6
Consolidated Statement of Changes in Equity 7
Consolidated Statement of Cash Flows 8
Notes to the Interim Condensed Consolidated Financial
Statements 9-12
TEX HOLDINGS PLC
CHAIRMAN'S STATEMENT
The business overall has been adversely impacted by the COVID-19
situation. As such, the board and senior management team have taken
swift and timely action to mitigate the impact caused by the
pandemic. The business has made use of the Government furlough
scheme and has managed costs tightly in all areas. It is expected
that the results of these measures will provide a solid base for
recovery and growth in 2021 although cashflow continues to be
critical.
The Plastics Division is trading at approximately 70% of
expected levels which is thanks to the increase in business from
the medical and hygiene sectors compensating for the slowdown in
other orders. With lockdown restrictions easing, business has
started showing signs of recovery. The cost control initiatives
previously announced have been implemented.
Tex Engineering is having a difficult year and a root and branch
review is being made of the cost and pricing structures to provide
a more efficient, lean and profitable operation. The orders are
improving with June intake recovering to pre COVID-19 levels, with
certain capital plant sales secured. The prospect of future
investment in major infrastructure projects gives grounds for
cautious optimism.
Eurotex trading during the first half of the year has been
better than budgeted levels with orders being received from a
number of sovereign navies. Work continues on the River class
vessels and the maintenance periods scheduled during lockdown are
now confirmed for the second half of the year.
The A.T.C. division continues to progress current contracts to
supply major international customers with seven Visual Control
Rooms which are in the final stages of completing the structural
calculations and design. Upon receipt of site-specific information
and client design approval, manufacturing will commence. Contracts
are ongoing in support of the Queen Elizabeth Class aircraft
carriers. The division is also working on a number of additional
tenders to supply specialist glass and Visual Control Rooms.
BSP started 2020 with a strong order book and continued to gain
good traction with order intake in Q1, which has resulted in us
completing the first half of the year slightly ahead of budgeted
sales despite the challenges of the pandemic. Cash collection has
been strong throughout the period and the second half of the year
is expected to be in line with budgeted levels.
G&M TEX has experienced a slowdown in orders, however the
orders for generators on six crab fishing vessels are expected to
be placed in Q3. The project for Colchester NHS Trust, whilst
delayed, is now expected to complete testing in July with
installation in August. Generally, the experience has been that
orders will still materialise but at a slower rate than
pre-pandemic expectations.
QK Honeycomb Products has been the one Group company hardest hit
by COVID-19. During the 1st quarter of the year trading was at
above budgeted levels. However, due to COVID-19, the majority of
QK's regular customers suspended production, resulting in a
significant drop in demand during the 2nd quarter. The easing of
government lockdown restrictions has seen a gradual return of some
customers, although normal operations are not anticipated to resume
until late August, after the annual summer shutdown period. The
main customer base - the 'leisure vehicle manufacturers' - are
reporting positive news from their dealers, advising a surge of
interest from new and existing customers as people consider the
'staycation' holiday.
As a Group, 2020 is no longer a year of planned growth, but a
year to review and consolidate the businesses, minimise costs
wherever possible and put measures in place to use COVID-19 as a
catalyst for change. This will build a far more lean and agile
business for when the recovery eventually materialises. In light of
the current uncertainties around COVID-19, the global economy and
Brexit, the Board has decided it needs additional working capital
and has approached the major shareholder for further funding.
The Board is not proposing to pay an interim dividend (2019:
GBPNil).
G.C. Gray
Chairman
12th August 2020
TEX HOLDINGS PLC
RESPONSIBILITY STATEMENT
In respect of the interim financial report
We confirm that to the best of our knowledge:
-- the interim condensed consolidated financial statements have
been prepared in accordance with IAS 34 "Interim Financial
Reporting" as adopted by the EU;
-- the interim management report includes a fair review of the
information required by Disclosure and Transparency Rules ("DTR")
4.2.7R (indication of the important events during the first six
months and description of principal risks and uncertainties for the
remaining six months of the year); and
-- the interim management report includes a fair review of the
information required by DTR 4.2.8R (disclosure of related parties'
transactions and changes therein).
G. C. Gray
Chairman
12th August 2020
TEX HOLDINGS PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
6 months
ended
6 months 30.06.19
ended
30.06.20 (Unaudited Year ended
& restated)
(Unaudited) GBP000 31.12.19
GBP000 (Audited)
Notes GBP000
Revenue 3 18,532 21,805 43,080
Cost of sales (13,425) (15,275) (32,446)
-------------- -------------- ------------
Gross profit 5,107 6,530 10,634
Selling and marketing costs (321) (502) (1,118)
Administrative expenses (5,663) (6,001) (9,789)
Operating (loss)/profit (877) 27 (273)
Finance costs (487) (378) (672)
-------------- -------------- ------------
Loss before taxation (1,364) (351) (945)
Taxation 4 - (1) (191)
-------------- -------------- ------------
Loss for the period (1,364) (352) (1,136)
Other comprehensive income:
Actuarial (loss)/gain arising
on defined benefit pension
scheme (1,886) - 2,149
Tax recognised on actuarial
loss/(gain) on defined pension
scheme 359 - (493)
-------------- -------------- ------------
Total comprehensive (loss)/income
for the period (2,891) (352) 520
============== ============== ============
Basic and diluted earnings
per share (21.5p) (5.5p) (17.9p)
============== ============== ============
TEX HOLDINGS PLC
CONSOLIDATED BALANCE SHEET
As at
As at 30.06.19 As at
30.06.20 (Unaudited 31.12.19
and restated)
(Unaudited) GBP000 (Audited)
Notes GBP000 GBP000
ASSETS
Non-current assets
Property, plant and equipment 7 12,265 12,931 12,780
Deferred tax assets - 213 -
------------------- ---------------- ------------
12,265 13,144 12,780
------------------- ---------------- ------------
Current assets
Inventories 7,790 8,272 7,946
Trade and other receivables 7,999 9,935 10,860
Corporation tax asset - 3 -
Cash in hand 2,536 - 1,017
18,325 18,210 19,823
------------------- ---------------- ------------
Total assets 30,590 31,354 32,603
=================== ================ ============
EQUITY
Capital and reserves attributable
to the equity holders of
the parent
Share capital 635 635 635
Capital redemption reserve 16 16 16
Other reserve 678 678 678
Share premium account 2,890 2,890 2,890
Retained earnings 1,438 3,457 4,329
------------------- ---------------- ------------
Total equity 5,657 7,676 8,548
=================== ================ ============
LIABILITIES
Non-current liabilities
Other interest-bearing loans
and borrowings 11,896 5,759 12,722
Deferred taxation 90 - 446
Employee benefits 1,511 1,843 -
Provisions 530 530 530
------------------- ---------------- ------------
14,027 8,132 13,698
------------------- ---------------- ------------
Current liabilities
Bank overdraft - 3,166 -
Other interest-bearing loans
and borrowings 1,291 2,677 1,310
Trade and other payables 9,568 9,575 8,954
Provision for other liabilities
and charges - 128 68
Taxation payable 47 - 25
10,906 15,546 10,357
------------------- ---------------- ------------
Total liabilities 24,933 23,678 24,055
------------------- ---------------- ------------
Total equity and liabilities 30,590 31,354 32,603
=================== ================ ============
TEX HOLDINGS PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Capital Other Reserve Share Premium
Share Capital Redemption Account Retained Total Equity
GBP000 Reserve GBP000 GBP000 Earnings GBP000
GBP000 GBP000
Balance at
1st January
2019
(restated) 635 16 678 2,890 3,885 8,104
Loss for the
period
(restated) - - - - (352) (352)
IFRS 16
adjustment - - - - (76) (76)
Dividends paid - - - - - -
---------------- --------------- -------------- --------------- --------------- ---------------
- - - - (428) (428)
---------------- --------------- -------------- --------------- --------------- ---------------
Balance at 30th
June 2019 635 16 678 2,890 3,457 7,676
================ =============== ============== =============== =============== ===============
Balance at 1st
January 2019
(restated) 635 16 678 2,890 3,885 8,104
Loss for the
period - - - - (1,136) (1,136)
IFRS16
adjustment to
opening
reserves - - - - (76) (76)
Pension fund
actuarial
movement net
of tax - - - - 1,656 1,656
Dividends paid - - - - - -
---------------- --------------- -------------- --------------- --------------- ---------------
- - - - 444 444
---------------- --------------- -------------- --------------- --------------- ---------------
Balance at 31st
December 2019 635 16 678 2,890 4,329 8,548
================ =============== ============== =============== =============== ===============
Balance at 1st
January 2020 635 16 678 2,890 4,329 8,548
Loss for the
period - - - - (1,364) (1,364)
Pension fund
actuarial
movement net
of tax - - - - (1,527) (1,527)
Dividends paid - - - - - -
---------------- --------------- -------------- --------------- --------------- ---------------
- - - - (2,891) (2,891)
---------------- --------------- -------------- --------------- --------------- ---------------
Balance at 30th
June 2020 635 16 678 2,890 1,438 5,657
================ =============== ============== =============== =============== ===============
TEX HOLDINGS PLC
CONSOLIDATED STATEMENT OF CASH FLOWS
6 months
ended
6 months 30.06.19
ended
30.06.20 (Unaudited Year ended
& restated)
(Unaudited) GBP000 31.12.19
GBP000 (Audited)
GBP000
Cash flows from operating activities
Loss for the period (1,364) (352) (1,136)
Adjustments for:
Depreciation 1,070 926 1,978
Profit on sale of fixed assets (12) (2) (7)
Finance costs 487 378 672
Taxation - 1 191
-------------- -------------- --------------
Operating profit before changes
in working capital and provisions 181 951 1,698
Movement in trade and other
receivables 2,494 509 (48)
Movement in inventories 156 (162) 164
Movement in trade and other
payables 613 50 (571)
Decrease in provisions (68) - (60)
Movement in employee benefits - (50) (100)
-------------- -------------- --------------
Cash generated from operations 3,376 1,298 1,083
Tax received/(paid) 25 (151) (147)
-------------- -------------- --------------
Net cash generated from operating
activities 3,401 1,147 936
-------------- -------------- --------------
Cash flows from investing activities
Purchases of property, plant
and equipment (PPE) (690) (2,032) (3,138)
Proceeds from sale of PPE 19 2 212
Net cash used in investing activities (671) (2,030) (2,926)
-------------- -------------- --------------
Cash flows from financing activities
New borrowings 349 1,058 8,765
Repayments of borrowings (894) (671) (2,698)
Finance lease payments (172) (247) (331)
Interest paid (494) (318) (624)
Net cash used in financing activities (1,211) (178) 5,112
-------------- -------------- --------------
Net decrease in cash and cash
equivalents 1,519 (1,061) 3,122
Cash and cash equivalents at
beginning of the period 1,017 (2,105) (2,105)
-------------- -------------- --------------
Cash and cash equivalents at
end of the period 2,536 (3,166) 1,017
============== ============== ==============
TEX HOLDINGS PLC
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
1. Basis of preparation
The condensed consolidated financial statements have been
prepared using accounting policies consistent with International
Financial Reporting Standards as adopted by EU and in accordance
with International Accounting Standard (IAS) 34 Interim Financial
Reporting. The condensed consolidated financial statements have not
been audited or reviewed.
They do not include all disclosures that would otherwise be
required in a complete set of financial statements and should be
read in conjunction with the 2019 annual report.
The comparative figures for the financial year ended 31st
December 2019 are the statutory financial statements for that
financial year. Those financial statements have been reported on by
the Company's auditors and delivered to the Registrar of Companies.
The report of the auditors was (i) a disclaimer of opinion, (ii)
did include a reference to any matters to which the auditors drew
attention by way of emphasis, and (iii) did contain a statement
under section 498 (2) or (3) of the Companies Act 2006.
2. Significant accounting policies
The condensed consolidated financial statements have been
prepared under the historical cost convention.
The same accounting policies, presentation and methods of
computation are followed in these condensed consolidated financial
statements as were applied in the preparation of the Group's
consolidated financial statements for the year ended 31st December
2019.
3. Segment information
The following is an analysis of the revenue and results for the
period analysed by business segment, the Group's primary basis of
segmentation.
Total for
Boards continuing
Plastics Engineering & Panels operations
6 months to 30th June GBP000 GBP000 GBP000 GBP000
2020
Revenue
Total revenue from
continuing operations 10,196 6,970 1,366 18,532
=========== ============== =========== ============
Result
Segment result from
continuing operations 372 (504) (219) (351)
Expenses pertaining
to the Company (526)
------------
Operating loss (877)
Finance costs (487)
------------
Profit before taxation (1,364)
Taxation -
------------
Loss for the period
from continuing operations (1,364)
============
TEX HOLDINGS PLC
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
3. Segment information (continued)
Segment information about the Group's continuing operations is
presented below.
Total for
Boards continuing
Plastics Engineering & Panels operations
6 months to 30th June GBP000 GBP000 GBP000 GBP000
2019
Revenue
Total revenue from
continuing operations 11,843 7,575 2,387 21,805
=========== ============== =========== ============
Result
Segment result from
continuing operations 652 (604) 82 130
Expenses pertaining
to the Company (103)
------------
Operating profit 27
Finance costs (378)
------------
Loss before taxation (351)
Taxation (1)
------------
Loss for the period
from continuing operations (352)
============
4. Taxation
Interim period corporation tax is accrued based on the estimated
average annual effective income tax rate of 19% (6 months ended
30th June 2019: 19%). We have not put in corporation tax assets
into the balance sheet as we do not believe that we will receive
refunds in relation to corporation tax. Losses will be utilised
within the Group.
5. Earnings per share
Basic earnings per share of (21.5p) (2019: (5.5p)) is based on
the following data.
Earnings 6 months 6 months
ended ended
30.06.20 30.06.19
(Unaudited) (Unaudited)
GBP000 GBP000
Earnings for the purposes of basic earnings
per share (1,364) (352)
============= =============
Number of shares 6 months 6 months
ended ended
30.06.20 30.06.19
(Unaudited) (Unaudited)
Weighted average number of ordinary
shares for the purposes of basic earnings
per share 6,351,452 6,351,452
============= =============
TEX HOLDINGS PLC
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
6. Dividends
During the interim period, no dividends were paid (2019:
GBPNil).
7. Property, plant and equipment
During the period, the Group spent GBP474,000 on additions.
It also disposed of certain machinery and equipment with a
carrying value of GBP7,000 for proceeds of GBP19,000.
8. Related party transactions
The Company has a related party relationship with its
subsidiaries and directors.
ARB Burrows has an interest in Edward Le Bas Properties Limited
through which the Group rents properties at normal commercial
rates. Transactions during the period ended 30th June 2020 that
require disclosure are detailed below:
Rentals paid GBP308,000 (30th June 2019: GBP257,000)
Other property related expenditure GBP84,000 (30th June 2019:
GBP93,000)
Trade payables GBP30,943 (30th June 2019: GBP14,692)
Rental of machinery GBP64,104 (30th June 2019: GBPNil)
ARB Burrows has an interest in IS&G Steel Stockholders
Limited through which the Group purchases steel. Transactions
during the period ended 30th June 2019 that require disclosure are
detailed below:
Purchases GBP54,137 (30th June 2019: GBP139,274)
Trade payables GBP2,566 (30th June 2019: GBP63,074)
ARB Burrows has an interest in Le Bas Investment Trust Limited
through which the Group has borrowed a short-term loan.
Transactions during the period ended 31st December 2019 that
require disclosure are detailed below:
Interest (3.75%) GBP13,556 (31st December 2018: GBP4,675)
Loan balance GBPNil (31st December 2018: GBP1,300,000)
ARB Burrows has an interest in Edward Le Bas Properties Limited
through which the Group has borrowed a term loan. Transactions
during the period ended 31st December 2019 that require disclosure
are detailed below:
Interest (8.00%) GBP52,165 (31st December 2018: GBPNil)
Loan organisation fees GBP2,166 (31st December 2018: GBPNil)
Loan balance GBP7,000,000 (31st December 2018: GBPNil)
ARB Burrows is a trustee and a beneficiary of the Pension and
Assurance Scheme of Edward Le Bas Limited, which is a substantial
shareholder in the Company.
All intra-group related party transactions and outstanding
balances are eliminated in the preparation of the consolidated
financial statements of the Group and therefore in accordance with
IAS 24 related party disclosures are not disclosed.
TEX HOLDINGS PLC
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
9. Significant events and transactions
The World Health Organisation declared coronavirus and COVID-19
a global health emergency on 30th January 2020. Since then, Tex
Holdings plc has experienced significant disruption to its
operations in the following respects:
Closure or partial closure of some of the Group's factories;
Disruptions in the supply of inventory from major suppliers;
and
Decreased demand for certain products.
The significant events and transactions that have occurred since
31st December 2019 relate to the effects of the global pandemic on
the Tex Holdings plc interim consolidated financial statements for
the six months ended 30th June 2020 and are summarised as
follows.
(a) Decrease in sales and cash flows
As disclosed in Note 3, most revenue streams have experienced
significant reductions since the pandemic's effects became
widespread.
(b) Government grants
Tex Holdings plc applied for various government support programs
introduced in response to the global pandemic. Included in profit
or loss is GBP688k of government grants obtained relating to
supporting the payroll of Tex Holdings plc employees. Tex Holdings
plc had to commit to spending the assistance on payroll
expenses.
10. Approval of interim financial statements
The interim financial statements were approved by the Board of
Directors on 12th August 2020.
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 BBGDICBBDGGX
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