Interim Results

Braime (T.F.& J.H.) (Hldgs) PLC
25 August 2000

 
 
HALF-YEARLY REPORT 
 
Although sales for the first half of this year have decreased marginally,
group trading profit has reduced from £82,000 in 1999 to £32,000 in
2000. Investment income has also fallen from £59,000 to £48,000 due to an
increase in debtors while interest payable has risen from £24,000 to £33,000.
This very disappointing result, the worst for many years, is due to three
principal factors.
 
Margins have been further depressed by the continued rise in the value of the
pound against the euro and by the need to respond to fierce price competition
in order to retain our market share both in the UK and overseas.
 
Secondly we have faced higher short term costs in the restructuring of our
French business.
 
Thirdly we have been involved in a legal dispute with a former employee
concerning a gross breach of his contract of employment and the need to
confirm and protect the copyright in important design software. Although now
resolved in our favour the costs of this action have impacted on the first
half result.
 
Having regard to the disappointing result the directors feel it prudent to
reduce the interim dividend from 3.00p paid in 1999 to 1.80p which will be 
paid on 6th October 2000 to shareholders whose names appear on the register on
8th September 2000.
 
Efforts continue to be made to improve sales volume whilst reducing operating
costs. Trading conditions in engineering remain very difficult.
 

Consolidated Profit & Loss Account for the six months to 30th June 2000

                                    Unaudited results for the        Year to
                                      six months to 30th June  31st December
                                            2000         1999           1999 
                                               £            £              £
                                                                              
Group turnover                         4,200,478    4,267,271      7,959,004
 
Trading profit                            31,654       81,797         26,437

Investment income                         47,538       59,263        108,636
 
Profit before interest                    79,192      141,060        135,073

Interest payable                          33,295       24,203         51,578
 
Profit before taxation                    45,897      116,857         83,495

Taxation at 30.00% for interim            
figures(1999 - 30.25%)                    13,769       35,349         85,134
                                                             
Profit after taxation                     32,128       81,508         (1,639)

Dividends                                 30,420       47,700        161,640
 
Retained profit                            1,708       33,808       (163,279)
                                                               
Earnings per share                         1.92p        5.35p         (0.74p)


Notes to the Interim Report for the six months ended 30th June 2000 
 
The financial information for the six months ended 30th June 2000 has not
been audited, nor has the financial information for the six months ended 30th
June 1999. However, the interim report includes a review signed by the
auditors. The comparative figures for the year ended 31st December 1999 do
not constitute the company's statutory accounts for that year, but have been
extracted from the statutory accounts filed with the Registrar of Companies,
and which carried an unqualified audit report. The report has been prepared
in accordance with applicable accounting standards on a consistent basis
using the accounting policies set out in the 1999 annual report.
 

Independent review report to T.F. & J.H. Braime (Holdings) P.L.C. 
 
Introduction

We have been instructed by the company to review the financial information
set out on pages 1 to 4 and we have read the other information contained in
the interim report and considered whether it contains any apparent
mis-statements or material inconsistencies with the financial information.
 
Directors' responsibilities

The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the directors. The Listing
Rules of the London Stock Exchange require that the accounting policies and
presentation applied to the interim figures should be consistent with those
applied in preparing annual accounts except where any changes, and the
reasons for them, are disclosed.
 
Review work performed

We conducted our review in accordance with guidance contained in Bulletin
1999/4 issued by the Auditing Practices Board. A review consists principally
of making enquiries of management and applying analytical procedures to the
financial information and underlying financial data and, based thereon,
assessing whether the accounting policies and presentation have been
consistently applied unless otherwise disclosed. A review excludes audit
procedures such as tests of controls and verification of assets, liabilities
and transactions. It is substantially less in scope than an audit performed
in accordance with Auditing Standards and therefore provides a lower level of
assurance than an audit. Accordingly we do not express an audit opinion on
the financial information.
 
Review conclusion

On the basis of our review we are not aware of any material modifications
that should be made to the financial information as presented for the six
months ended 30th June 2000.
 
John Gordon Walton & Co.
Chartered Accountants
Yorkshire House
Greek Street
Leeds
LS1 5ST                                                    25th August 2000
 

Consolidated Balance Sheet as at 30th June 2000

                                       Unaudited    Unaudited
                                       30th June    30th June  31st December  
                                            2000         1999           1999 
                                               £            £              £
                                                                              
Fixed assets      Intangible assets       14,572       16,792         15,098  
                  Tangible assets        692,351      679,176        683,022
     
                                         706,923      695,968        698,120
     
Current assets    Stocks               1,959,263    1,862,115      1,756,612  
                  Debtors              2,129,631    1,865,231      1,729,802  
                  Cash at bank and       
                  in hand              1,634,226    2,166,096      2,062,619  
                                        
                                       5,723,120    5,893,442      5,549,033
   
Creditors         Amounts falling due    
                  within one year     (2,139,380)  (2,114,021)    (1,965,229) 
                                                    
Net current assets                     3,583,740    3,779,421      3,583,804  
                                                 
Total assets less current liabilities  4,290,663    4,475,389      4,281,924  
                                                                
Deferred income                          (32,234)     (33,890)       (33,062)
    
Net assets                             4,258,429    4,441,499      4,248,862
   
Capital and       Called up share         
reserves          capital                540,000      540,000        540,000  
                  Reserves             3,718,429    3,901,499      3,708,862
   
Shareholders'funds                     4,258,429    4,441,499      4,248,862 
                  Comprising:                                              
                  Non-equity              
                  shareholders'funds     180,000      180,000        180,000  
                  Equity                 
                  shareholders'funds   4,078,429    4,261,499      4,068,862  
                                                                              
                       

Consolidated Cash Flow Statement for the six months to 30th June 2000

                                       Unaudited    Unaudited        Year to
                                       30th June    30th June  31st December
                             Notes          2000         1999           1999
                                               £            £              £
Net cash outflow from                                        
operating activities             1      (224,302)    (137,440)      (146,242)
 
Returns on investments and servicing of finance                              
Interest received                         47,538       59,263        108,636  
Interest paid                            (33,295)     (24,203)       (51,578) 
Non-equity dividends paid                 (4,500)      (4,500)        (9,000)
  
                                           9,743       30,560         48,058
  
Taxation                                                   
Tax paid                                       -     (101,698)      (259,009) 
                                                                              
Capital expenditure                        
Purchase of tangible fixed assets        (96,664)     (79,960)      (129,043) 
Disposal of tangible fixed assets              -            -         19,450
           
                                         (96,664)     (79,960)      (109,593)
                               
Equity dividends paid                   (109,440)    (118,080)      (161,280)
        
Management of liquid resources                                              
Decrease in treasury deposits     2      369,461      293,682        288,589
     
Decrease in cash                  3       51,202      112,936        339,477
                                                        
 
Notes to Consolidated Cash Flow Statement

1. Reconciliation of operating profit                                Year to
   to net cash outflow from           Six months to 30th June  31st December
   operating activities                     2000         1999           1999 
                                               £            £              £
                                                                              
   Operating profit                       31,654       81,797         26,437  
   Depreciation of tangible and             
   intangible assets                      82,857       77,698        136,975  
   Profit on disposal of fixed assets          -            -        (19,445) 
   Government grants amortised              (828)        (828)        (1,656) 
   Increase in stocks                   (202,651)    (340,533)      (235,030) 
   (Increase)/decrease in debtors       (414,528)     (65,458)       106,701  
   Increase/(decrease) in creditors      274,190       94,367       (163,390) 
   Movement in value of assets caused by                                      
   foreign exchange movements              5,004       15,517          3,166
      
                                        (224,302)    (137,440)      (146,242) 

 
2. Analysis of changes in net funds     December    Cash flow           June
                                            1998                        1999 
                                               £            £              £ 
                                                                     
   Cash at bank and in hand              394,501      121,539        516,040  
   Bank loans and overdrafts            (710,399)    (224,314)      (934,713)
  
                                        (315,898)    (102,775)      (418,673)
   Treasury deposits                   1,943,738     (293,682)     1,650,056
  
                                       1,627,840     (396,457)     1,231,383  
 
 
                                        December    Cash flow           June
                                            1999                        2000 
                                               £            £              £
                                                                       
   Cash at bank and in hand              407,470      (58,932)       348,538
   Bank loans and overdrafts          (1,048,237)      15,589     (1,032,648)

                                        (640,767)     (43,343)      (684,110)
   Treasury deposits                   1,655,149     (369,461)     1,285,688

                                       1,014,382     (412,804)       601,578 
 
 
3. Reconciliation of net cash flow                       June           June
   to movement in net funds                              2000           1999 
                                                            £              £
     
                                                                        
   Decrease in cash                                   (51,202)      (112,936) 
   Effect of foreign exchange rate changes              7,859         10,161
    
                                                      (43,343)      (102,775) 
   Decrease in treasury deposits                     (369,461)      (293,682) 
                                                                       
   Movement in net funds in the year                 (412,804)      (396,457) 
   Net funds at 31st December 1999/1998             1,014,382      1,627,840 
 
   Net funds at 30th June 2000/1999                   601,578      1,231,383