Preliminary announcement
Camellia PLC
24 April 2008
Camellia Plc
Preliminary results for year ended 31 December 2007
Highlights from the results:-
Year ended Year ended
31 December 31 December
2007 2006
£'000 £'000
Revenue 161,936 160,552
Profit before tax 30,651 19,982
Profit for the year 27,446 15,174
Earnings per share 910.8 p 464.2 p
Dividends 92 p 90 p
Chairman's statement
The profit before tax for 2007 amounted to £30.65 million and compares with the
previous year of £19.98 million. The profit for 2007 includes a number of
exceptional items, the larger being the profit of £4.80 million on the disposal
of our shareholding in Getaz Romang SA and the sale of a surplus London property
resulting in a profit of £1.68 million. The profit consolidated in respect of
our interest in Siegfried Holding AG also includes exceptional items amounting
to £3.68 million.
The underlying trading profit of the group is less than that of the previous
year, reflecting the weakness of the US dollar and the costs of integrating new
businesses within Duncan Lawrie.
Dividend
The board is recommending a final dividend of 72p per share, which, together
with the interim dividend already paid of 20p per share, brings the total
distribution for the year to 92p per share compared with 90p per share in
respect of 2006.
Agriculture and horticulture
Tea
India
Tea production in India amounted to 33.3m kilos, an increase of nearly 9% over
the previous year. Weather conditions were reasonably favourable and prices were
comparable to the previous year. The market for orthodox tea remained firm. The
programme of upgrading factories continues and results have so far been
encouraging and fully justify the capital investment. Political disruption in
Assam and parts of West Bengal make life difficult for management.
Bangladesh
Tea production in Bangladesh was the same as for 2006, which is disappointing,
as we experienced a major drought at the beginning of that year. Tea prices
reduced during the year by 13% resulting in a reduction of profitability. The
programme for increasing production and quality continues.
The political situation remains quiet and it is expected that elections will be
held towards the end of 2008.
Africa
Both Kenya and Malawi produced excellent crops in 2007. The previous year was,
however, impacted by a serious drought in Kenya. Prices drifted downwards during
the year but due to the increased production, profitability was satisfactory.
The comparatively high cost of labour remains a concern.
Tea prices increased substantially at the beginning of 2008 partly as a result
of the tense political situation in Kenya. However, an extended period of dry
weather resulting in low production seems to be an equally valid reason for the
increase in prices, which have in any event recently moderated.
The phased sale by Kakuzi of the Siret Tea Company to members of the local
community received Presidential Consent in September 2007 and the initial part
of this transaction has been implemented.
At the time of writing the political impasse regarding the Presidential
elections has been resolved by a power sharing agreement. It is to be hoped that
this agreement can be fully implemented without further conflict and it is
encouraging that, after prolonged negotiations, a new cabinet has been
appointed. Our tea estates are operating normally although a small number of our
employees were evacuated at the time of the greatest tension. None of our
personnel were injured and damage to property was very limited.
The logistical problems of moving tea from Malawi have improved. However, there
is presently heavy congestion in the Port of Mombasa mainly as a result of
delays in moving goods through Mombasa to surrounding countries.
Edible nuts
2007 was an 'off' year for pistachio production in California but nonetheless
the final output exceeded the budgeted expectation.
Macadamia production in Malawi exceeded that in 2006 but in South Africa
production declined. Prices continue at low levels but we remain confident of
the long term prospects for this crop. Macadamia planting at Kakuzi in Kenya
commenced during the year.
Other horticulture
Kakuzi's gradually maturing avocado orchards in Kenya improved their production
and prices were approximately 20% higher than in 2006 resulting in a
satisfactory profit. The new packhouse continued to perform well and is
currently being expanded to cater for the projected increase in production.
Rubber production in Bangladesh increased as a result of maturing plantations
and prices increased by approximately 8%. New areas of rubber are being
established and the prospects for this crop remain encouraging.
In Brazil we benefited from good maize and soya crops with firm prices. Our
timber operations also showed good results although we are now entering a period
of three years when no timber will be harvested.
Our citrus operations in California produced good results with higher production
and firm prices. We were unaffected by inclement weather in early 2008 and the
prospects for this crop remain encouraging.
In South Africa our wine grape harvest was below the previous year due to the
removal of vines that had come to the end of their useful productive life.
Replanting of these and additional areas has commenced.
Table grape production in Chile improved and prices in dollar terms also showed
an increase. However, the Chilean currency has appreciated substantially against
the US dollar and this gives cause for concern.
Food storage and distribution
Our food storage and distribution operations in the UK continue to show an
improving trend. Substantial reorganisation costs were incurred in 2007 and this
should hopefully put the company in a position to make profits from 2008. The
cold storage and transport market remains very competitive and increased energy
costs remain a concern.
The progress made by our two food distribution companies in The Netherlands in
2006 continued into 2007.
Engineering
It is pleasing to report that our engineering subsidiaries again increased their
overall profitability in 2007.
Our operations remain busy particularly in the North Sea oil and gas sectors and
in the aerospace markets. There remains a distinct shortage of skilled
operatives in the engineering sector and this is causing particular problems for
our operations both in Aberdeen and Lowestoft. The local cost of labour in
Aberdeen continues to escalate and some projects are being diverted to other
production areas as Aberdeen has become just too expensive.
After many false starts we have at last received planning consent for the
development of our galvanising operation at Great Yarmouth. It is hoped that
this plant will be operational towards the latter part of 2008.
Banking and financial services
Duncan Lawrie's profits for 2007 were below those for the previous year. This is
principally as a result of additional expenditure in anticipation of the
proposed integration of the three operating companies in 2008. The consolidation
of the operating subsidiaries will continue throughout 2008 and further
expenditure will have to be incurred particularly in respect of premises and IT
costs. Duncan Lawrie has no exposure to sub-prime mortgages but the fall in
stock market values will have an adverse impact on its investment management
fees.
Pharmaceuticals
The Siegfried Group's primary focus for 2007 was in the development, scale-up
and production of active pharmaceutical ingredients and the development and
production of complex generics, including those based on inhalation technology
in the field of asthma. During the year Siegfried disposed of its Sidroga
Division and also its Biologics subsidiary based in Germany. Work has commenced
in Zofingen on a new laboratory building which will greatly assist Siegfried in
increasing its capability in the pharmaceutical research industry.
Other associated undertakings and investments
The profitability of United Leasing in Bangladesh was comparable to the previous
year. Also in Bangladesh, the profit of United Insurance was reduced on account
of a lower contribution from its subsidiary, Surmah Valley Tea Company due to
reduced tea prices. The share capital of United Insurance has been increased to
comply with government requirements and further increases may be required in due
course.
BF&M Limited, a Bermudian insurance company, is now treated as an associate
company and has recently announced net earnings for the year of 27.3 million
Bermudian dollars, a record for the company. All insurance and non insurance
lines of business recorded excellent results. The diversification into other
countries in lines of business in which they have expertise has opened up new
avenues for profitability in future years.
Our other investments in Bermuda generally enjoyed another successful year.
Development
The tea factory development programme in India will continue over the next few
years. Kakuzi in Kenya is presently finalising a new development plan which will
encompass all the land originally planted to coffee. Our farm in Brazil is
expanding its centre pivot irrigation operations and in Chile we have recently
opened a new winery for the processing of our own grapes. The success of these
developments and indeed our operations generally are being considerably affected
by the declining value of the US dollar. Whilst the value of our exports in US
dollar is reducing when translated into local currency, the cost of labour,
power and fertilisers continues to increase.
Pensions
During 2007 a number of changes were made to the three UK final salary schemes,
including the closure of one scheme to future accrual. Each of these schemes has
been closed to new entrants since November 2006. Alternative defined
contribution arrangements have been put into place. Management of the
liabilities of these schemes will remain a concern particularly against the
background of the recent volatility in stock market values and bond pricing.
Staff
My thanks are due to our staff throughout all the countries in which we operate
for their invaluable contribution to another successful year.
For those that may not have had the opportunity to read my 2007 interim
statement, I repeat with great sadness that our Chairman Emeritus, Mr Keith
FitzGerald passed away in September last year. Keith's contribution to the
success of the Camellia Group was immeasurable and he will be greatly missed by
all his friends and colleagues.
M C Perkins
Chairman
24 April 2008
Consolidated income statement
for the year ended 31 December 2007
2007 2006
Notes £'000 £'000
Revenue 2 161,936 160,552
Cost of sales (107,497) (106,239)
----------- -----------
Gross profit 54,439 54,313
Other operating income 1,631 1,657
Distribution costs (9,665) (8,987)
Administrative expenses (37,261) (36,141)
----------- -----------
Trading profit 2 9,144 10,842
Share of associates' results 3 10,568 4,932
Profit on disposal of non-current assets 4 2,029 929
Profit on disposal of non-current assets
held for sale 5 327 952
Profit on disposal of available-for-sale
investments 6 5,259 364
Profit on part disposal of a subsidiary 7 170 -
Gain arising from changes in fair value of
biological assets 2,770 1,176
----------- -----------
Profit from operations 30,267 19,195
Investment income 867 1,606
Finance income 8 701 709
Finance costs 8 (1,921) (2,544)
Pension schemes' net financing income 8 737 1,016
----------- -----------
Net finance costs 8 (483) (819)
----------- -----------
Profit before tax 30,651 19,982
Taxation 9 (3,205) (4,808)
----------- -----------
Profit for the year 27,446 15,174
=========== ===========
Profit attributable to minority interests 2,129 2,271
Profit attributable to equity shareholders 25,317 12,903
----------- -----------
27,446 15,174
=========== ===========
Earnings per share - basic and diluted 11 910.8 p 464.2 p
Consolidated balance sheet
at 31 December 2007
2007 2006
£'000 £'000
Non-current assets
Intangible assets 8,246 7,865
Property, plant and equipment 76,233 76,257
Biological assets 80,633 75,553
Prepaid operating leases 982 969
Investments in associates 90,367 63,672
Deferred tax assets 1,356 1,344
Other investments 41,186 55,466
Retirement benefit surplus 5,766 3,585
Trade and other receivables 634 526
----------- -----------
Total non-current assets 305,403 285,237
----------- -----------
Current assets
Inventories 20,137 19,067
Trade and other receivables 67,893 52,416
Current income tax assets 1,616 1,786
Cash and cash equivalents 235,612 210,560
----------- -----------
325,258 283,829
Non-current assets classified as held for sale - 167
----------- -----------
Total current assets 325,258 283,996
----------- -----------
Current liabilities
Borrowings (14,771) (16,688)
Trade and other payables (275,913) (235,008)
Current income tax liabilities (1,786) (2,488)
Other employee benefit obligations (169) (142)
Provisions (123) (58)
----------- -----------
Total current liabilities (292,762) (254,384)
----------- -----------
Net current assets 32,496 29,612
----------- -----------
Total assets less current liabilities 337,899 314,849
----------- -----------
Non-current liabilities
Borrowings (11,797) (14,951)
Deferred tax liabilities (26,719) (25,161)
Retirement benefit obligations (10,608) (17,781)
Other employee benefit obligations (1,293) (1,163)
Other non-current liabilities (341) (417)
Provisions - (112)
----------- -----------
Total non-current liabilities (50,758) (59,585)
----------- -----------
Net assets 287,141 255,264
=========== ===========
Equity
Called up share capital 284 284
Reserves 265,987 235,677
----------- -----------
Shareholders' funds 266,271 235,961
Minority interests 20,870 19,303
----------- -----------
Total equity 287,141 255,264
=========== ===========
Consolidated cash flow statement
for the year ended 31 December 2007
2007 2006
Notes £'000 £'000
Cash generated from operations
Cash flows from operating activities 14 14,171 9,235
Interest paid (2,271) (2,857)
Income taxes paid (3,442) (3,416)
Interest received 697 665
Dividends received from associates 2,252 1,835
----------- -----------
Net cash flow from operating activities 11,407 5,462
Cash flows from investing activities
Purchase of intangible assets (208) (237)
Purchase of property, plant and equipment (6,953) (8,657)
Proceeds from sale of non-current assets 2,948 2,564
Proceeds from sale of non-current assets
held for sale 489 1,634
Part disposal of a subsidiary 400 -
Acquisition of subsidiary (net of cash acquired) (549) (3,670)
Purchase of minority interests (193) -
Minority share subscription - 541
Purchase of shares in associate (2) (23)
Proceeds from sale of investments 8,235 9,596
Purchase of investments (7,915) (4,378)
Income from investments 867 1,606
----------- -----------
Net cash flow from investing activities (2,881) (1,024)
Cash flows from financing activities
Equity dividends paid (2,502) (2,474)
Dividends paid to minority interests (1,132) (1,055)
Net (repayment of)/increase in debt (3,625) 4,971
Purchase of own shares - (31)
----------- -----------
Net cash flow from financing activities (7,259) 1,411
----------- -----------
Net increase in cash and cash equivalents 1,267 5,849
Cash and cash equivalents at beginning of year 13 (542) (6,435)
Exchange gains on cash 33 44
----------- -----------
Cash and cash equivalents at end of year 758 (542)
=========== ===========
For the purposes of the cash flow statement, cash and cash equivalents are
included net of overdrafts repayable on demand. These overdrafts are excluded
from the definition of cash and cash equivalents disclosed on the balance sheet.
Statement of recognised income and expense
for the year ended 31 December 2007
2007 2006
£'000 £'000
Foreign exchange translation differences 5,407 (26,348)
Actuarial movement on defined benefit pension schemes 6,030 3,540
Movement on deferred tax relating to defined benefit
pension schemes (639) (1,185)
Available-for-sale investments:
Valuation gains taken to equity 2,044 4,401
Transferred to profit or loss on sale (3,630) (124)
Other fair value adjustment - 69
Share of associate's net movement in defined benefit
pension schemes 372 257
Share of associates' fair value adjustments 932 (73)
Share of associate's (loss)/profit on cash flow hedges (115) 378
Share of associate's income taxes on items recorded in
equity (29) (27)
----------- -----------
Net income/(expense) recognised directly in equity 10,372 (19,112)
Profit for the year 27,446 15,174
----------- -----------
Total recognised income and expense for the year 37,818 (3,938)
=========== ===========
Attributable to:
Minority interests 2,505 (1,109)
Equity shareholders 35,313 (2,829)
----------- -----------
37,818 (3,938)
=========== ===========
1 General information
The consolidated income statement, consolidated balance sheet, consolidated cash
flow statement, consolidated statement of recognised income and expense and
extracts from the notes to the accounts for 31 December 2007 and 31 December
2006 do not constitute the group's annual report and accounts. The auditors have
reported on the group's statutory accounts for each of the years 2007 and 2006
under section 235 of the Companies Act 1985, which do not contain statements
under sections 237 (2) or (3) of the Companies Act and are unqualified. The
statutory accounts for 2006, which were prepared under International Financial
Reporting Standards adopted for use in the EU, have been delivered to the
Registrar of Companies.
The statutory accounts for 2007, prepared under International Financial
Reporting Standards adopted for use in the EU, will be filed with the Registrar
in due course. Copies of the annual report and accounts will be posted to
shareholders on 1 May 2008. From that date copies will be available from the
registered office, Linton Park, Linton, Near Maidstone, Kent ME17 4AB.
2 Business and geographical segments
The principal activities of the group are as follows:
Agriculture and horticulture
Engineering
Food storage and distribution
Banking and financial services
For management reporting purposes these activities form the basis on which the
group reports its primary divisions.
Segment information about these businesses is presented below:
2007
Agriculture and Engineering Food storage Banking and Other Consolidated
horticulture and financial operations
distribution services
£'000 £'000 £'000 £'000 £'000 £'000
Revenue
External sales 89,004 20,109 38,561 13,949 313 161,936
=========== =========== =========== =========== =========== ===========
Trading profit
Segment profit 9,072 2,124 (133) 1,431 (113) 12,381
----------- ----------- ----------- ----------- -----------
Unallocated corporate expenses (3,237)
-----------
Trading profit 9,144
Share of associates' results (6) 3,882 6,692 10,568
Profit on disposal of
non-current assets 2,029
Profit on disposal of assets
held for resale 327
Profit on disposal of
available-for-sale investments 5,259
Profit on part dispoal of a
subsidiary 170
Gain arising from changes in
fair value of biological
assets 2,770 2,770
Investment income 867
Net finance costs (483)
-----------
Profit before tax 30,651
Taxation (3,205)
-----------
Profit after tax 27,446
===========
Other information
Segment assets 152,009 15,197 26,975 282,259 3,440 479,880
Investments in associates 935 20,721 68,711 90,367
Unallocated assets 60,414
-----------
Consolidated total assets 630,661
===========
Segment liabilities (23,001) (2,828) (7,006) (253,203) (268) (286,306)
Unallocated liabilities (57,214)
-----------
Consolidated total liabilities (343,520)
===========
Capital expenditure 4,189 1,152 1,095 425
Depreciation (3,084) (834) (3,111) (264) (14)
Amortisation (31) (4) (348)
2006
Agriculture and Engineering Food storage Banking and Other Consolidated
horticulture and financial operations
distribution services
£'000 £'000 £'000 £'000 £'000 £'000
Revenue
External sales 88,549 20,255 39,266 11,096 1,386 160,552
=========== =========== =========== =========== =========== ===========
Trading profit
Segment profit 12,682 1,744 (512) 1,766 (9) 15,671
----------- ----------- ----------- ----------- -----------
Unallocated corporate expenses (4,829)
-----------
Trading profit 10,842
Share of associates' results 18 395 4,519 4,932
Profit on disposal of non-current
assets 929
Profit on disposal of assets
held for resale 952
Profit on disposal of
available-for-sale investments 364
Profit on part dispoal of a
subsidiary -
Gain arising from changes in
fair value of biological
assets 1,176 1,176
Investment income 1,606
Net finance costs (819)
-----------
Profit before tax 19,982
Taxation (4,808)
-----------
Profit after tax 15,174
===========
Other information
Segment assets 144,721 14,347 29,622 241,774 2,686 433,150
Investments in associates 920 2,566 60,186 63,672
Unallocated assets 72,411
-----------
Consolidated total assets 569,233
===========
Segment liabilities (23,284) (2,813) (7,683) (212,355) (151) (246,286)
Unallocated liabilities (67,683)
-----------
Consolidated total liabilities (313,969)
===========
Capital expenditure 3,809 904 1,981 137 102
Depreciation (3,161) (830) (2,997) (214) (16)
Amortisation (16) (6) (243)
Segment assets consist primarily of intangible assets, property, plant and
equipment, biological assets, prepaid operating leases, inventories, trade and
other receivables and cash and cash equivalents. Receivables for tax have been
excluded. Investments in associates, valued using the equity method, have been
shown separately in the segment information. Segment liabilities are primarily
those relating to the operating activities and generally exclude liabilities
for taxes, short-term loans, finance leases and non-current liabilities.
Geographical segments
The group operations are based in nine main geographical areas. The United
Kingdom is the home country of the parent. The principal geographical areas in
which the group operates are as follows:
United Kingdom
Continental Europe
India
Kenya
Malawi
Bangladesh
North America and Bermuda
South Africa
South America
The following table provides an analysis of the group's sales by geographical
market, irrespective of the origin of the goods/services:
2007 2006
£'000 £'000
United Kingdom 71,682 66,908
Continental Europe 18,174 19,055
India 37,802 35,241
Kenya 11,876 12,908
Malawi 3,120 4,485
Bangladesh 7,057 7,944
North America and Bermuda 1,951 3,390
South Africa 1,718 2,512
South America 3,400 3,184
Other 5,156 4,925
----------- -----------
161,936 160,552
=========== ===========
The following is an analysis of the carrying amount of segment assets, and
additions to property, plant and equipment, analysed by the geographical area in
which the assets are located:
Carrying amount of Additions to property,
segment assets plant and equipment
2007 2006 2007 2006
£'000 £'000 £'000 £'000
United Kingdom 320,463 280,918 2,550 2,815
Continental Europe 4,219 4,179 111 192
India 46,851 40,495 1,804 825
Kenya 36,788 37,603 661 699
Malawi 26,778 24,955 688 659
Bangladesh 20,170 19,743 229 826
North America and Bermuda 3,924 4,148 8 305
South Africa 7,360 9,495 179 273
South America 13,327 11,614 631 339
----------- ----------- ----------- -----------
479,880 433,150 6,861 6,933
=========== =========== =========== ===========
3 Share of associates' results
The group's share of the results of associates is analysed below:
2007 2006
£'000 £'000
Operating profit 8,561 6,570
Net finance costs (650) (780)
----------- -----------
Profit before tax 7,911 5,790
Taxation (1,026) (858)
----------- -----------
Profit after tax 6,885 4,932
Net profit from discontinued operations 3,683 -
----------- -----------
10,568 4,932
=========== ===========
The net profit from discontinued operations relates to the disposal by the
Siegfried Group of its Sidroga division and its biologics business unit. The
profit resulting from the disposal of the Sidroga division of £4,804,000,
included in net profit from discontinued operations, is provisional due to an
arbitration procedure being initiated by the purchaser.
The results include the group's share of the profits of BF&M Limited, a
Bermudian based insurance company, which became an associate with effect from
1 January 2007.
4 Profit on disposal of non-current assets
2007 2006
£'000 £'000
Profit on disposal of property 2,029 929
=========== ===========
5 Profit on disposal of non-current assets held for sale
A profit of £327,000 (2006: £952,000) was realised in relation to property,
plant and equipment of Eastern Produce South Africa (Pty) Limited which had
previously been used in the group's production of tea in South Africa and were
reclassified as being held for sale in 2005.
6 Profit on disposal of available-for-sale investments
The profit of £5,259,000 includes a profit of £4,801,000 relating to the
disposal of the group's entire shareholding in Getaz Romang Holding SA, a
public quoted company on the SWX Swiss Exchange.
7 Profit on part disposal of a subsidiary
A profit of £170,000 was realised in relation to the disposal by Kakuzi Limited
of 14 per cent. of its interest in Siret Tea Company Limited to EPK Outgrowers
Empowerment Project Company Limited, a company mainly owned by smallholders
in Kenya.
8 Finance income and costs
2007 2006
£'000 £'000
Interest payable on loans and bank overdrafts (2,141) (2,341)
Interest payable on obligations under finance leases (180) (144)
----------- -----------
Total borrowing costs (2,321) (2,485)
Net exchange gain/(loss) on foreign currency borrowings 400 (59)
----------- -----------
Finance costs (1,921) (2,544)
Finance income - interest income on short-term
bank deposits 701 709
Pension schemes net financing income 737 1,016
----------- -----------
Net finance costs (483) (819)
=========== ===========
The above figures do not include any amounts relating to the banking
subsidiaries.
9 Taxation on profit on ordinary activities
Analysis of charge in the year 2007 2006
£'000 £'000 £'000
Current tax
UK corporation tax
UK corporation tax at 30.0 per cent.
(2006:30.0 per cent.) 1,681 2,004
Adjustment in respect of prior years (14) (152)
Double tax relief (1,560) (1,709)
---------- ----------
107 143
Foreign tax
Corporation tax 2,936 3,789
Adjustment in respect of prior years (1) 263
---------- ----------
2,935 4,052
---------- ----------
Total current tax 3,042 4,195
Deferred tax
Origination and reversal of timing differences
United Kingdom (483) (486)
Overseas 646 1,099
---------- ----------
Total deferred tax 163 613
---------- ----------
Tax on profit on ordinary activities 3,205 4,808
---------- ----------
Factors affecting tax charge for the year
Profit on ordinary activities before tax 30,651 19,982
Less: share of associated undertakings profit 10,568 4,932
---------- ----------
Group profit on ordinary activities before tax 20,083 15,050
---------- ----------
Tax on ordinary activities at the standard rate
of corporation tax in the UK of 30.0 per cent.
(2006: 30.0 per cent.) 6,025 4,515
Effects of:
Adjustment to tax in respect of prior years (15) 111
Expenses not deductible for tax purposes 479 256
Adjustment in respect of foreign tax rates 251 460
Additional tax arising on dividends from
overseas companies 316 353
Profit on disposal of non taxable assets (2,173) (702)
Other income not charged to tax (1,168) (246)
Increase in tax losses carried forward 400 635
Decrease in tax losses carried forward (226) (462)
Effect of abolition of industrial buildings
allowance on deferred tax (732) -
Movement in other timing differences 48 (112)
---------- ----------
Current tax charge for the year 3,205 4,808
========== ==========
10 Equity dividends 2007 2006
£'000 £'000
Amounts recognised as distributions to equity
holders in the period:
Final dividend for the year ended 31 December 2006 of
70.00p (2005: 69.00p) per share 1,946 1,918
Interim dividend for the year ended 31 December 2007
of 20.00p (2006: 20.00p) per share 556 556
----------- -----------
2,502 2,474
=========== ===========
Dividends amounting to £56,000 (2006: £56,000) have not been included as group
companies hold 62,500 issued shares in the company. These are classified as
treasury shares.
Proposed final dividend for the year ended
31 December 2007 of 72.00p (2006: 70.00p) per share 2,046 1,989
========== ===========
The proposed final dividend is subject to approval by the shareholders at the
annual general meeting and has not been included as a liability in these
financial statements and will be payable on 3 July 2008 to shareholders on the
register of members at the close of business on 13 June 2008.
11 Earnings per share (EPS)
2007 2006
Weighted Weighted
average average
number of number of
Earnings shares EPS Earnings shares EPS
£'000 Number Pence £'000 Number Pence
Basic and diluted EPS
Attributable to ordinary
shareholders 25,317 2,779,500 910.8 12,903 2,779,784 464.2
========= ========= ========= ========= ========= =========
Basic and diluted earnings per share are calculated by dividing the earnings
attributable to ordinary shareholders by the weighted average number of
ordinary shares in issue during the period, excluding 62,500 held by the group
as treasury shares.
12 Investments in associates and other investments
With effect from 1 January 2007, the group has representation on the board of BF
&M Limited and is in a position to exert significant influence. As a result the
investment in this company has been reclassified from other investments to an
investment in associate. The result of this reclassification is that investments
in associates increase by £14,449,000, being the equity value and other
investments decline by £17,231,000, being the market value. The difference of
£2,782,000 has been transferred to reserves.
13 Cash and cash equivalents
2007 2006
£'000 £'000
Cash at bank and in hand 203,786 179,318
Short-term bank deposits 3,944 6,696
Short-term liquid investments 27,882 24,546
----------- -----------
235,612 210,560
=========== ===========
Included in the amounts above are cash and short-term funds, time deposits
with banks and building societies and certificates of deposit amounting to
£223,849,000 (2006: £198,422,000) which are held by the group's banking
subsidiaries and which are an integral part of the banking operations.
Cash, cash equivalents and bank overdrafts include the following for the
purposes of the cash flow statement:
2007 2006
£'000 £'000
Cash and cash equivalents (excluding banking
operations) 11,763 12,138
Bank overdrafts (11,005) (12,680)
----------- -----------
758 (542)
=========== ===========
14 Reconciliation of profit from operations to cash flow
2007 2006
£'000 £'000
Profit from operations 30,267 19,195
Share of associates' results (10,568) (4,932)
Depreciation and amortisation 7,868 7,673
Impairment of non-current assets - 117
Gain arising from changes in fair value of
biological assets (2,770) (1,176)
Profit on disposal of non-current assets (2,029) (929)
Profit on disposal of non-current assets held
for sale (327) (952)
Profit on part disposal of a subsidiary (170) -
Profit on disposal of investments (5,259) (364)
Increase in working capital (7,949) (2,743)
Net decrease/(increase) in funds of banking
subsidiaries 5,108 (6,654)
----------- -----------
14,171 9,235
=========== ===========
15 Reconciliation of net cash flow to movement in net debt
2007 2006
£'000 £'000
Increase in cash and cash equivalents in the
year 1,266 5,849
Cash outflow/(inflow) from decrease/(increase) in
debt 4,310 (3,486)
----------- -----------
Decrease in net debt resulting from cash flows 5,576 2,363
New finance leases (685) (1,734)
Exchange rate movements (196) 881
----------- -----------
Decrease in net debt in the year 4,695 1,510
Net debt at beginning of year (19,500) (21,010)
----------- -----------
Net debt at end of year (14,805) (19,500)
=========== ===========
Press Enquiries: Malcolm Perkins, Chairman
Tel: 01622 746655
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