Interim Results
Dewhurst PLC
08 June 2006
Dewhurst plc
Directors' Interim Report
FIRST HALF
This report is prepared under International Financial Reporting Standards for
the first time. The main substantive changes for the Group are that goodwill is
no longer amortised in the accounts and the pension scheme deficit is shown on
the face of the consolidated balance sheet. Comparative figures for last year
have been adjusted to the new standards.
Turnover at the Group was slightly down at £15.0 million compared to £15.1
million last year. Profit before tax rose 18% to £1.80 million (£1.52 million).
Earnings per share grew 13% to 11.7p (10.3p).
Lift and Rail Division sales were broadly flat in the first half with overseas
sales showing a small increase and sales in the UK slightly lower.
Keypad Division sales were down a little over 10%, reflecting the significant
price reductions that we have implemented over the last 12 months. However the
volume of sales at the Keypad Division remains steady. Two years ago we reported
that we had lost the contract to provide keyboard products for the next
generation of machines for a major ATM customer. We are delighted to report that
we have now won this business back, albeit at lower prices.
Acquisitions provided £1.0 million of sales in the first half, with a full 6
months contribution from Lift Material and two months from Traffic Management
Products (TMP). Both acquisitions are performing satisfactorily to date.
AIM
Following shareholder approval at the EGM on 24th January 2006, the company
transferred trading in its shares to AIM on 22nd February 2006.
OUTLOOK
The profit on continuing operations was slightly up in a difficult market of
declining prices and significant cost pressures. We have continued, in the first
half, to generate efficiency and sourcing improvements to offset these adverse
impacts. We will need further improvements in the second half to maintain our
position.
As stated at the year-end, we expect growth to come from our acquisitions. We
believe there are good prospects for the products of our latest acquisition,
TMP, but it will take a little time for these sales to build.
DIVIDENDS
The Directors have declared an interim dividend of 1.71p which amounts to £168k,
compared with 1.63p last year (£161k). The interim dividend is payable on 29th
August 2006 and warrants will be posted on 24th August 2006 to shareholders
appearing in the Register at 3:00 p.m. on 14th July 2006.
By Order of the Board
J C SINCLAIR
Finance Director & Secretary
8 June 2006
Dewhurst plc
The unaudited consolidated income statement, balance sheet and cash flow
statement of Dewhurst plc and its subsidiaries for the half-year ended 31st
March 2006, as compared with the corresponding half-year ended 31st March 2005
and the year ended 30th September 2005, shows the following results:
Consolidated income statement
Half year ended Half year ended Year
ended
31st March 2006 31st March 2005 30th September
2005
£(000)'s £(000)'s £(000)'s
(Restated) (Restated)
----------------------- ---------- ---------- -----------
Revenue
- Continuing operations 13,876 15,134 29,649
- Acquisitions 1,074 - 345
----------------------- ---------- ---------- -----------
14,950 15,134 29,994
Operating costs
- Continuing operations (12,387) (13,706) (26,296)
- Acquisitions (848) - (243)
----------------------- ---------- ---------- -----------
(13,235) (13,706) (26,539)
Operating profit
- Continuing operations 1,489 1,428 3,353
- Acquisitions 226 - 102
----------------------- ---------- ---------- -----------
1,715 1,428 3,455
Net interest 88 97 190
----------------------- ---------- ---------- -----------
Profit before tax 1,803 1,525 3,645
Taxation Est. (654) Est. (510) (1,250)
----------------------- ---------- ---------- -----------
Profit for the period 1,149 1,015 2,395
----------------------- ---------- ---------- -----------
Basic earnings per
share (Restated) 11.66p 10.30p 24.31p
Diluted earnings per
share (Restated) 11.66p 10.30p 24.31p
Dividends per share 1.71p 1.63p 4.89p
Dewhurst plc
Consolidated balance sheet
Half year Half year Year
ended ended ended
31st March 31st March 30th September
2006 2005 2005
£(000)'s £(000)'s £(000)'s
(Restated) (Restated)
------------------------ --------- ---------- -----------
Non-current assets
Goodwill 5,342 839 1,531
Property, plant and equipment 2,872 2,955 2,911
Deferred tax asset 1,886 1,916 2,129
------------------------ --------- ---------- -----------
10,100 5,710 6,571
Current assets
Inventories 3,575 4,067 3,778
Trade and other receivables 5,846 5,083 5,726
Cash and cash equivalents 3,867 5,323 6,438
------------------------ --------- ---------- -----------
13,288 14,473 15,942
------------------------ --------- ---------- -----------
Total assets 23,388 20,183 22,513
------------------------ --------- ---------- -----------
Non-current liabilities
Retirement benefit deficit (6,286) (6,384) (7,098)
Long term provisions (200) (210) (200)
------------------------ --------- ---------- -----------
(6,486) (6,594) (7,298)
Current liabilities
Trade and other payables (2,417) (1,881) (2,143)
Current tax liabilities (602) (326) (464)
Short term provisions (1,331) (1,350) (1,445)
------------------------ --------- ---------- -----------
(4,350) (3,557) (4,052)
------------------------ --------- ---------- -----------
Total liabilities (10,836) (10,151) (11,350)
------------------------ --------- ---------- -----------
Net assets 12,552 10,032 11,163
------------------------ --------- ---------- -----------
Capital and reserves
Share capital 985 985 985
Share premium account 157 157 157
Revaluation reserve 423 423 423
Capital redemption reserve 152 152 152
Retained earnings 10,835 8,315 9,446
------------------------ --------- ---------- -----------
Equity shareholders' funds 12,552 10,032 11,163
------------------------ --------- ---------- -----------
The results for the 2005 year set out above are abridged. Full accounts for that
year reported under UK GAAP, on which the auditors of the company made an
unqualified report, have been delivered to the Registrar of Companies.
Dewhurst plc
Consolidated cash flow statement
Half year ended Half year ended Year ended
31st March 2006 31st March 2005 30th September
2005
£(000)'s £(000)'s £(000)'s
(Restated) (Restated)
----------------------- ---------- ----------- ----------
Cash flows from operating activities
Operating profit 1,715 1,428 3,455
Depreciation 182 236 441
Foreign exchange (profit)/loss (11) 129 397
(Profit)/loss on sale of fixed assets 1 (1) (3)
----------------------- ---------- ----------- ----------
1,887 1,792 4,290
(Increase)/decrease
in inventories 587 97 663
(Increase)/decrease in trade
and other receivables 496 (20) (717)
Increase/(decrease) in trade
and other payables (263) (930) (611)
----------------------- ---------- ----------- ----------
Cash generated from operations 2,707 939 3,625
Interest paid - - (1)
Income tax paid (557) (754) (1,298)
----------------------- ---------- ----------- ----------
Net cash from operating activities 2,150 185 2,326
Cash flows from investing activities
Purchase of subsidiary undertakings (4,352) - (913)
Sale of property,
plant and equipment 1 10 18
Purchase of property,
plant and equipment (137) (112) (166)
Interest received 88 97 191
----------------------- ---------- ----------- ----------
Net cash used in investing activities (4,400) (5) (870)
Cash flows from financing activities
Dividends paid (321) (305) (466)
----------------------- ---------- ----------- ----------
Net cash used in
financing activities (321) (305) (466)
----------------------- ---------- ----------- ----------
Net increase/(decrease)in cash
and cash equivalents (2,571) (125) 990
----------------------- ---------- ----------- ----------
Cash and cash equivalents at
beginning of period 6,438 5,448 5,448
----------------------- ---------- ----------- ----------
Cash and cash equivalents at
end of period 3,867 5,323 6,438
----------------------- ---------- ----------- ----------
Dewhurst plc
Notes to the accounts
1. Basis of preparation
Dewhurst plc's consolidated financial statements were prepared in accordance
with United Kingdom Generally Accepted Accounting Practice (UK GAAP) until 30
September 2005.
The 30 September 2006 consolidated financial statements will be prepared in
accordance with International Financial Reporting Standards (IFRSs). The
transition date was 1 October 2004 being the start date of the earliest period
for which the group presents full comparative information in its 2006 Annual
Report and Accounts.
In preparing this interim report in accordance with IFRS 1, the group has
applied the mandatory exceptions from full retrospective application of IFRS.
UK GAAP differs in some areas from IFRS and so in preparing these interim
statements management has amended certain accounting, valuation and
consolidation methods applied in the UK GAAP financial statements to comply with
the recognition and measurement criteria of IFRS. The comparative figures in
respect of 2005 are restated to reflect these adjustments.
Presentation - IAS 1, Presentation of Financial Statements
The presentation format of IFRS is different from UK GAAP. Apart from the
obvious key heading changes in the primary statements, the following information
is designed to assist the reader to understand the format and numerical changes.
Goodwill - IAS 38, Intangible assets
Goodwill arising on acquisitions before the date of transition to IFRS has been
retained at the previous UK GAAP amounts subject to being tested for impairment
at that date.
Goodwill arising on consolidation represents the excess of the cost of
acquisition over the group's interest in the fair value of the identifiable
assets and liabilities of a subsidiary at the date of acquisition.
Under IAS 38 goodwill is not amortised. Instead it is subject to an annual
impairment review. Any impairment is recognised immediately in the income
statement and is not subsequently reversed. An adjustment has been made to
remove the goodwill amortisation charge.
Pension Costs - IAS 19, Employee Benefits
Under IAS 19, the group has shown the full actuarial value of the surplus or
deficit of the pension scheme on the balance sheet. Any movements in the pension
assets and liabilities arising from actuarial gains and losses will be
recognised immediately in full through the statement of recognised income and
expense (SORIE).
Dividends - IAS 10, Events After the Balance Sheet Date
Under IFRS dividends proposed are not recognised as liabilities. Accordingly the
2005 proposed interim and final dividend amounts reported under UK GAAP have
been removed from the IFRS income statements.
Cash Flow
The differences between UK GAAP and IFRS cash flows relate to the
reclassification of some of the headings and the inclusion of some of the UK
GAAP notes to the cash flow statement. There is no impact on the final cash
position nor the movement in the period.
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