Final Results

Solid State Supplies PLC                            

Preliminary Announcement for the year ended 31 March 2003

CHAIRMAN'S STATEMENT

Results

The audited profit before tax of the Group was £240,000 (2002: £116,000) on a
turnover of £9,009,000 (2002: £5,986,000). The basic earnings per share
amounted to 3.8p (2002: 1.4p).

Trading Review

Solid State Supplies

Trading conditions within the electronic components distribution industry
remain difficult. Following the close review of overheads undertaken last year,
the Company has been able to continue trading profitably through the last year.
There is evidence of improvement in several sectors of the industry, and we
believe that the Company is well placed to gain useful new business as the
markets recover.

Steatite

Steatite relocated to new premises at Redditch in Worcestershire during the
second half of the year. Steatite had to deal with unanticipated problems on a
sub-contract which relates to an amount receivable of £428,254 on the balance
due under a sub-contract which will be payable when the main contractor has
been paid. The Directors are satisfied that the contract has been
satisfactorily completed in terms of the Group's commitments and are confident
that the main contractor will be able to successfully complete the remaining
work and that the debt will therefore be fully recoverable.

Despite the cost of relocation and of overhead reduction, the Company remained
profitable and has now been successful in obtaining significant new orders both
in distribution and in manufacturing. This has been reflected in a good start
to the new financial year. There are further prospects of significant new
orders, particularly in the military sector.

Management changes

Bill Marsh, having reached the age of 65, has decided to step down as Deputy
Chairman at the annual general meeting in July. I would like to thank Bill for
his contribution to the running of the Group while in the Deputy Chairman role,
which he has occupied since 1997 when he stood down as the managing director.
To assist the smooth handover to the new management, I have decided to step
down at the same time. Bill and I will be remaining on the board and continuing
to contribute to the management of the Group.

In our place, Peter Haining will take over as Chairman and Cyril Newnham as
Deputy Chairman. Peter has been involved with Solid State Supplies for 15 years
and has been our finance director since 1996. Cyril has been a non executive
director of Solid State Supplies since 1996, and has extensive experience of
holding senior positions in businesses within our industry.

Dividends

The Directors are recommending a final dividend of 2p per share which, together
with the interim dividend, makes a total for the year of 3.5p per share. This
compares with a total of 8p per share last year which included a special
interim dividend of 5p per share. The final dividend will be paid on 25th July
2003 to shareholders on the register at the close of business on 11th July
2003.

Conclusion

The Board believes that the Group is well placed to take full advantage of
opportunities in all its areas of operation during the current year.

I would like to thank my fellow Directors and the staff in general for their
continued support.

Gordon L Comben

Chairman

30th June 2003

 


CONSOLIDATED PROFIT AND LOSS ACCOUNT

For the year ended 31st March 2003

                           Continuing operations        Total        Total
                                                                          
                                    Acquisitions         2003         2002
                                                                          
                              2003          2003                          
                                                                          
                                 £             £            £            £
                                                                          
                 Notes                                                    
                                                                          
Turnover           2     4,774,193     4,234,796    9,008,989    5,985,568
                                                                          
Cost of sales          (3,293,564)   (2,954,876)  (6,248,440)  (4,367,370)
                                                                          
GROSS PROFIT             1,480,629     1,279,920    2,760,549    1,618,198
                                                                          
Selling expenses                                                          
and distribution                                                          
costs                    (749,989)     (386,396)  (1,136,385)    (943,103)
                                                                          
Administrative                                                            
expenses                 (569,969)     (758,080)  (1,328,049)    (574,525)
                                                                          
                                                                          
                                                                          
OPERATING PROFIT   3       160,671       135,444      296,115      100,570
                                                                          
Other interest                                                            
receivable and                                                            
similar income                                          5,316       15,788
                                                                          
Interest payable                                     (60,955)            -
                                                                          
PROFIT ON                                                                 
ORDINARY                                                                  
ACTIVITIES                                                                
BEFORE TAXATION                                       240,476      116,358
                                                                          
Tax on profit on                                                          
ordinary                                                                  
activities                                            (4,856)     (31,990)
                                                                          
PROFIT ON                                                                 
ORDINARY                                                                  
ACTIVITIES AFTER                                                          
TAXATION                                              235,620       84,368
                                                                          
Dividends -                                                               
Equity             4                                (217,875)    (498,500)
                                                                          
                                                                          
                                                                          
RETAINED PROFIT/                                                          
(LOSS) FOR THE                                                            
YEAR                                                   17,745    (414,132)
                                                                          
EARNINGS PER                                                              
SHARE                                                                     
                                                                          
Basic              5                                     3.8p         1.4p
                                                                          
Diluted            5                                     3.7p         1.3p
                                                                          

                                                                       

There were no recognised gains or losses other than the profit for the year as
stated above.

 


RECONCILIATION OF MOVEMENT IN GROUP SHAREHOLDERS' FUNDS

For the year ended 31st March 2003

                                               2003       2002
                                                              
                                                  £          £
                                                              
Profit for the year                         235,620     84,368
                                                              
Less: Dividends                           (217,875)  (498,500)
                                                              
          Purchase of own shares              -       (13,630)
                                                              
Net addition to/(reduction in)                                
shareholders' funds                       17,745.00  (427,762)
                                                              
Opening shareholders' funds               2,061,831  2,489,593
                                                              
Closing shareholders' funds               2,079,576  2,061,831
                                                              

 


CONSOLIDATED BALANCE SHEET

at 31st March 2003

 

                               2003                  2002           
                                                                    
                    Notes         £          £          £          £
                                                                    
FIXED ASSETS                                                        
                                                                    
Intangible assets                      663,016                     -
                                                                    
Tangible assets                        559,466               278,457
                                                                    
Investments                                500                   100
                                                                    
                                     1,222,982               278,557
                                                                    
CURRENT ASSETS                                                      
                                                                    
Stocks                    1,193,606             1,002,870           
                                                                    
Debtors               6   2,049,142             1,019,924           
                                                                    
Cash at bank and in                                                 
hand                         16,385               655,478           
                                                                    
                          3,259,133             2,678,272           
                                                                    
CREDITORS: Amounts                                                  
falling due within                                                  
one year              7   1,814,592               894,998           
                                                                    
NET CURRENT ASSETS                   1,444,541             1,783,274
                                                                    
Total assets less                                                   
current liabilities                  2,667,523             2,061,831
                                                                    
Creditors: Amounts                                                  
falling due after                                                   
more than one year    8                587,947                     -
                                                                    
                                     2,079,576             2,061,831
                                                                    
CAPITAL AND                                                         
RESERVES                                                            
                                                                    
Called up share                                                     
capital                                311,250               311,250
                                                                    
Share premium                                                       
account                                756,980               756,980
                                                                    
Capital redemption                                                  
reserve                                  1,250                 1,250
                                                                    
Profit and loss                                                     
account                              1,010,096               992,351
                                                                    
SHAREHOLDERS'                                                       
FUNDS-EQUITY                         2,079,576             2,061,831
                                                                    

 

The financial statements were approved by the Board on 30th June 2003

G L Comben

Director


CONSOLIDATED CASH FLOW STATEMENT

For the year ended 31st March 2003

                                        2003                   2002           
                                                                              
                             Notes         £            £         £          £
                                                                              
Net cash inflow from                                                          
operating activities                              293,730            2,024,261
                                                                              
Return on investments and                                                     
servicing                                                                     
                                                                              
 of finance:                                                                  
                                                                              
 Interest received                     5,316                 15,788           
                                                                              
 Interest paid                      (60,955)                      -           
                                                                              
Net cash (outflow)/inflow                                                     
from return on investments                                                    
and servicing of finance                         (55,639)               15,788
                                                                              
Taxation                                                                      
                                                                              
 Corporation tax paid                            (31,990)            (281,761)
                                                                              
Capital expenditure and                                                       
financial investment                                                          
                                                                              
 Payments to acquire                                                          
tangible fixed assets              (119,075)               (64,324)           
                                                                              
 Payments to acquire                                                          
investments                            (400)                      -           
                                                                              
 Receipts from sales of                                                       
tangible fixed assets                 30,882                 11,500           
                                                                              
 Net cash outflow from                                                        
capital expenditure and                                                       
financial investment                             (88,593)             (52,824)
                                                                              
                                                                              
                                                                              
Acquisitions and disposals                                                    
                                                                              
Purchase of business                                                          
operation                                     (1,312,458)                    -
                                                                              
Equity dividends paid                           (280,125)            (499,250)
                                                                              
Net cash (outflow)/inflow                                                     
before financing                              (1,475,075)            1,206,214
                                                                              
Financing                                                                     
                                                                              
Medium term loan received            750,000                      -           
                                                                              
Repayments of medium term                                                     
loan: capital element              (102,307)                      -           
                                                                              
Hire purchase finance                                                         
repaid: capital element             (57,317)                      -           
                                                                              
Purchase of own shares                     -               (13,630)           
                                                                              
Net cash inflow/(outflow)                                                     
from financing                                    590,376             (13,630)
                                                                              
(Decrease)/increase in cash                     (884,699)            1,192,584
                                                                              


 

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 31st March 2003

1.

The attached preliminary announcement is prepared on the same basis as set out
in the previous year's annual accounts and does not constitute statutory
accounts within the meaning of Section 240 of the Companies Act 1985; the
statutory accounts for the year ended 31 March 2003, upon which an unqualified
audit opinion has been given and which did not contain a statement under
Section 235, 237(2) or 237(3) of the Companies Act 1985, will be delivered to
the Registrar of Companies at a later date.  A duly appointed and authorised
committee of the Board of Directors approved the preliminary announcement on 30
June 2003. 

2.            SEGMENTAL ANALYSIS

The turnover and profit before taxation are attributable to the one principal
activity of the Group.  All operations are located in the United Kingdom. An
analysis of sales by destination is as follows:

                              2003       2002
                                             
                                 £          £
                                             
United Kingdom           7,939,739  5,506,869
                                             
Europe                     741,536    478,699
                                             
United States of America    42,450          -
                                             
Asia                       281,989          -
                                             
Africa                       3,275          -
                                             
                         9,008,989  5,985,568
                                             

                       

3.            OPERATING PROFIT

           

The operating profit is stated after charging/(crediting):         
                                                                   
                                                      2003     2002
                                                                   
                                                         £        £
                                                                   
Depreciation                                       146,199   86,822
                                                                   
Loss on disposal of fixed assets                     2,396    1,604
                                                                   
Amortisation of goodwill                            29,602        -
                                                                   
Auditors' remuneration:                                            
                                                                   
  Audit services                                    22,045   11,069
                                                                   
Operating lease rentals:                                           
                                                                   
  Plant and machinery                               43,107   30,767
                                                                   
  Other                                            153,133   38,000
                                                                   
Foreign exchange gains                            (27,336)  (1,259)
                                                                   
Employment termination costs                        30,000   66,773
                                                                   
Shares for All Employee Share Plan                   7,833   11,422
                                                                   
Relocation expenses                                 16,388        -
                                                                   

 

Included in audit fees is an amount of £12,045 (2002: £11,069) in respect of
the Company. Additional non-audit services regarding the purchase of Steatite
Limited were £5,500 and have been capitalised in investments in the Company,
and added to the goodwill figure on consolidation.

 

4.            DIVIDENDS   

                                                             2003     2002
                                                                          
                                                                £        £
                                                                          
Special interim dividend paid of nil per share (2002: 5p)       -  311,750
                                                                          
Interim dividend paid of 1.5p per share (2002: nil)        93,375        -
                                                                          
Final dividend proposed of 2p per share (2002: 3p)        124,500  186,750
                                                                          
                                                          217,875  498,500
                                                                          

5.      EARNINGS PER SHARE

                                                       2003       2002
                                                                      
                                                          £          £
                                                                      
The earnings per share is based on the following:                     
                                                                      
  Earnings                                          235,620     84,368
                                                                      
  Weighted average number of shares               6,225,000  6,239,412
                                                                      
  Diluted number of shares                        6,424,000  6,477,412
                                                                      
  Earnings per share                                   3.8p       1.4p
                                                                      
  Diluted earnings per share                           3.7p       1.3p
                                                                      

                       

Earnings per ordinary share has been calculated using the weighted average
number of shares in issue during the year. The weighted average number of
equity shares in issue was 6,225,000 (2002: 6,239,412).

The Diluted earnings per share is based on 6,424,000 (2002: 6,477,412) ordinary
shares which allow for the exercise of all dilutive potential ordinary shares.

6.           DEBTORS: Amounts receivable within one year

                            Group      Group    Company    Company
                                                                  
                             2003       2002       2003       2002
                                                                  
                                £          £          £          £        
                                                                  
Trade debtors           1,953,738    981,531    884,881    981,531
                                                                  
Amounts owed by Group                                             
                                                                  
undertakings                    -          -  1,263,906          -
                                                                  
Other debtors               9,945      1,730          -      1,730
                                                                  
Prepayments and accrued                                           
                                                                  
income                     85,459     36,663     47,307     36,663
                                                                  
                        2,049,142  1,019,924  2,196,094  1,019,924
                                                                  

Trade debtors include an amount receivable of £428,254 which relates to the
balance due under a sub-contract which will be payable when the main contractor
has been paid. The Directors are satisfied that the contract has been
satisfactorily completed in terms of the Group's commitments and are confident
that the main contractor will be able to successfully complete the remaining
work and that the debt will therefore be fully recoverable.

Group trade debtors include £474,562 which are subject to an invoice
discounting agreement. Under this agreement, borrowing equal to 80% of the
relevant book debts can be taken with interest charged at 1.75% over bank base
rate and an administration fee of 0.3% of the gross value of debts per month.
There was an initial arrangement fee of £1,000. At 31st March 2003, borrowing
under the agreement of £379,650 was available of which £159,126 was taken up
leaving unused borrowing liabilities of £220,524. Interest charges in the year
amounted to £14,477 and administration fees to £12,091. There was no invoice
discounting agreement in place during the year ended 31st March 2002.

7.             CREDITORS: Amounts falling due within one year

                                              Group     Group   Company   Company
                                                                                 
                                               2003      2002      2003      2002
                                                                                 
                                                  £         £         £         £
                                                                                 
Bank overdrafts (secured)                    86,480         -    86,480         -
                                                                                 
Bank loan (secured)                         133,781         -    91,148         -
                                                                                 
Trade creditors                             999,592   521,930   397,562   521,930
                                                                                 
Amounts due to invoice discounters          159,126         -         -         -
                                                                                 
Corporation tax                               4,856    31,990     4,856    31,990
                                                                                 
Other taxes and social security costs       177,964   107,547    92,828   107,547
                                                                                 
Proposed dividend                        124,500      186,750   124,500   186,750
                                                                                 
Obligations under hire purchase                                                  
                                                                                 
contracts                                    12,804         -         -         -
                                                                                 
Other creditors                              37,287     2,026    13,989     2,026
                                                                                 
Accruals and deferred income                 78,202    44,755    38,478    44,755
                                                                                 
                                          1,814,592   894,998   849,841   894,998
                                                                                 

The bank loan and overdraft are secured by a fixed and floating charge over the
assets of the Company and the Group. At the balance sheet date, the Group had
an undrawn overdraft facility of £576,020 (2002: £450,000), which enables
flexibility in the management of liquidity.

8.            CREDITORS: Amounts falling due after more than one year

                                                  Group   Group   Company   Company
                                                                                   
                                                   2003    2002      2003      2002
                                                                                   
                                                      £       £         £         £
                                                                                   
Bank loan (secured)                             556,545       -   556,545         -
                                                                                   
                                                                                   
                                                                                   
Obligations under hire purchasecontracts         31,402       -         -         -
                                                                                   
                                                587,947       -   556,545         -
                                                                                   
Bank loan repayments are due:                                                      
                                                                                   
In more than one year but not                                                      
                                                                                   
more than two years                              91,148       -    91,148         -
                                                                                   
In more than two year but not                                                      
                                                                                   
more than five years                            340,397       -   340,397         -
                                                                                   
In more than five years                         125,000       -   125,000          
                                                                                   
                                                556,545       -   556,545         -
                                                                                   

The whole of the obligations under hire purchase contracts is due in less than
two years.

The bank loan was for £750,000 taken out in May 2002 and repayable by
instalments over seven years. The loan is secured by a fixed and floating
charge over the assets of the Company and the Group.

9.The Annual Report will be sent to shareholders on 1 July 2003 and made
available to the public at the registered office of the Company at Unit 2,
Eastlands Lane, Paddock Wood, Kent, TN12 6BU