Interim Results - Pre-tax Profit Up 89%

Galliford PLC 29 February 2000 Excellent Interim Results from Galliford - earnings up 96% - Operating profit £2.5million up 64% - Pre-tax profit £2.1million up 89% - Earnings per share 1.35p up 96% - Construction order book at all time high - £80 million PPP multiple schools contract won - the largest in England - Heads of agreement signed with operator for Northampton RTI - Housing completions increased by 22% 'We anticipate a buoyant Spring housing market and so long as no adverse legislation is announced in the Budget, our housing will maintain its growth pattern. Our construction order book is at a record level and we look forward with confidence to steadily improving margins.' Tony Palmer, Chairman FULL STATEMENT ATTACHED Enquiries: George Marsh, Managing Director John Livingston, Financial Director Galliford plc Tel: 01455-222722 www.galliford.co.uk Galliford plc Interim Results six months ended 31 December 1999 STATEMENT BY THE CHAIRMAN, TONY PALMER I am delighted to be able to report in my first announcement to shareholders that excellent progress continues to be made. Operating profit for the six months to 31 December 1999 increased by 64% to £2.5m and pre-tax profit by 89% to £2.1m. Earnings per share increased by 96% to 1.35p. Dividend Whilst these results show an excellent increase in profits, we are declaring an unchanged interim dividend of 0.5p per share and any increase for the full year, which may be proposed, will be applied, as last year, to the final dividend. Private housing Operating profit increased by 55% to £2.0m on turnover which increased by 51% to £20.8m. The areas in which we operate are the Eastern Counties and the South West, which continue to show a steady demand for housing although they have not generally shown the rapid house price inflation reported in certain areas of London and the South East. Completions rose by 22% to 232 units at an average selling price of £90,134. Construction Operating profits increased by 70% to £1.2m on turnover which increased by 8% to £101.5m. The resultant margins of 1.2% (1998: 0.8%) are still short of our declared aim of obtaining maintainable margins in excess of 2% although great strides have been made towards achieving this. The following milestones will assist in progressing towards this objective: - Our order book is at an all time high of £200M and over 70% of this has been secured through partnerships and other value criteria. The skills utilised in servicing these markets enable us to provide a complete solution to a client's construction requirements at a lower all in cost whilst enabling the company to achieve superior returns. - We announced on 17 February that we had been awarded the largest multiple school building programme in England under the Private Public Partnership procedures. This contract, worth £80m, consists of a building programme for £37m and will be completed by May 2002. Our Facilities Management Division will then be responsible for the operation of the premises-related services over the 30-year term of the project. We are confident that the experience gained during these negotiations will enable further PPP projects to be obtained. - Our joint venture (RTI) promotion of guided bus projects continues to advance. Although the necessity for a public enquiry into the first two legs at Northampton will delay the start of construction until next year, we are delighted to be able to announce that Heads of Agreement have been signed with an operator who will acquire a 50% share in the company formed to develop the Northampton project. The operator will run the guided buses and has also agreed to share costs on initial studies for other cities. - Two of the areas in which we expect increased construction activity are the areas of Water and Social Housing. I am pleased to announce that Galliford Northern has been chosen as a potential partner by Hyder for the next phase of capital works in Wales. Galliford Hodgson and Midas, as leading providers of social housing, have secured partnering relationships with Kingsmead Homes, Toynbee Housing Association and Devon & Cornwall Housing Association. Systems As expected, our preparation for Year 2000 enabled us to operate normally through the Millennium changeover. After a substantial business process re-engineering study we have recently placed orders for new systems which will allow management information and contracts documentation to be accessed by sites and offices using web based technology. This will increase efficiency, reduce costs and provide the platform to enable the group to communicate electronically with clients and suppliers and to take advantage of e-business opportunities as they develop. Finance Our net debt of £6.9m at 31 December 1999 represented a gearing level of 31% (1998: 26%). The net interest of £0.4m was covered 6.4 times by operating profit. Prospects Our strategy continues to be based on developing leading local brands in housing and on being a recognised leader in defined sectors of the construction market. We anticipate a buoyant Spring housing market and so long as no adverse legislation is announced in the Budget, our housing will maintain its growth pattern. Our construction order book is at a record level and we look forward with confidence to steadily improving margins. Galliford plc Interim Results six months ended 31 December 1999 Analysis of Trading Results 6 months ended 6 months ended Year ended 31 December 31 December 30 June 1999 1999 1998 Turnover Profit Turnover Profit Turnover Profit £'000 £'000 £'000 £'000 £'000 £'000 Private housing 20,768 1,980 13,799 1,279 41,866 4,756 Construction 101,532 1,223 93,957 718 183,910 1,848 Group (726) (490) (1,161) 122,300 2,477 107,756 1,507 225,776 5,443 Net interest (390) (406) (901) 122,300 2,087 107,756 1,101 225,776 4,542 Note: Comparative trading results for the six months ended 31 December 1998 have been restated in accordance with the revised disclosures adopted for the year ended 0 June 1999, with group costs now shown separately. Group costs include the group's share of costs relating to the RTI project. Galliford plc Interim Results six months ended 31 December 1999 Consolidated Profit and Loss Account 6 months 6 months Year ended ended ended 30 June 1999 31 December 31 December 1999 1998 £'000 £'000 £'000 Turnover - continuing 122,300 107,792 225,812 operations Less: share of joint - 36 36 ventures' turnover Group turnover 122,300 107,756 225,776 Operating costs 119,732 106,249 220,289 Group operating profit - continuing operations 2,568 1,507 5,487 Share of operating losses (91) - (44) of joint ventures 2,477 1,507 5,443 Interest receivable 127 36 67 Profit before interest 2,604 1,543 5,510 payable Interest payable 517 442 968 Profit on ordinary activities 2,087 1,101 4,542 before taxation Tax on profit on ordinary 626 341 1,417 activities Profit on ordinary activities 1,461 760 3,125 after taxation attributable to members of Galliford plc Dividends 550 550 1,320 Transferred to reserves 911 210 1,805 Earnings per share 1.35p 0.69p 2.88p Diluted earnings per share 1.34p 0.69p 2.88p Dividend per share 0.5p 0.5p 1.2p Galliford plc Interim Results six months ended 31 December 1999 Consolidated Balance Sheet 31 December 1999 31 December 1998 30 June 1999 £'000 £'000 £'000 £'000 £'000 £'000 Fixed assets Tangible assets 4,258 4,031 3,966 Investments Investments in joint ventures Goodwill 285 - 293 Share of gross assets 1,142 253 794 Share of gross (1,338) (195) (896) liabilities Loan to joint ventur 1,900 - 850 1,989 58 1,041 Other investments 263 392 303 2,252 450 1,344 6,510 4,481 5,310 Current assets Stocks 34,820 28,223 28,421 Development land 21,606 20,093 23,097 Debtors 41,136 33,605 37,202 Cash at bank and in hand 2,595 751 1,528 100,157 82,672 90,248 Current liabilities Creditors: amounts falling due within one year Bank overdraft 8,283 3,981 2,934 Bank loans 76 736 383 Other 68,540 54,564 63,805 Net current assets 23,258 23,391 23,126 Total assets less current liabilities 29,768 27,872 28,436 Creditors: amounts 5,305 6,524 5,097 falling due after more than one year Provisions for 1,897 1,069 1,684 liabilities and charges 7,202 7,593 6,781 22,566 20,279 21,655 Capital and reserves Called up share capital 5,498 5,498 5,498 Share premium account 477 477 477 Revaluation reserve 167 171 167 Other reserves 35 35 35 Profit and loss account 16,389 14,098 15,478 Shareholders' funds 22,566 20,279 21,655 Galliford plc Interim Results six months ended 31 December 1999 Consolidated Cash Flow Statement 6 months ended 6 months ended Year ended 31 December 1999 31 December 1998 30 June 1999 £'000 £'000 £'000 £'000 £'000 £'000 Net cash (outflow)/inflow (1,002) (2,799) 1,850 from continuing operating activities (see note 7) Dividends from joint 4 - 50 ventures Returns on investments and servicing of finance Interest received 127 36 67 Interest paid (483) (398) (872) Loan note interest paid (33) (48) (90) Interest element of finance lease rental payments (1) (8) (16) Net cash outflow from returns on investments and servicing of finance (390) (418) (911) Taxation paid (35) (144) (567) Capital expenditure and financial investment Purchase of tangible fixed (712) (426) (998) assets Sale of tangible fixed 25 12 328 assets Increase in investment in (1,050) - (526) joint venture Purchase of own shares - (77) (217) Net cash outflow for capital (1,737) (491) (1,413) expenditure and financial investment Equity dividends paid (770) (660) (1,210) Cash outflow before (3,930) (4,512) (2,201) financing Financing Capital element of finance lease (19) (65) (135) rental payments Repayment of bank loans (307) (5,909) (6,262) Redemption of loan notes (26) (108) (172) (352) (6,082) (6,569) Decrease in cash (4,282) (10,594) (8,770) Galliford plc Interim Results six months ended 31 December 1999 Notes 1 The interim statement was approved by the board of directors on 29 February 2000. 2 The figures for the six months ended 31 December 1999 and 1998 have not been audited or reviewed. These figures have been prepared in accordance with the same accounting policies used in the financial statements for the year ended 30 June 1999. 3 The results for the year ended 30 June 1999 are an abridged version of the statutory accounts for that period on which the auditors gave an unqualified report and which have been filed with the Registrar of Companies. 4 A statement of total recognised gains and losses has not been provided as there were no recognised gains or losses other than those shown in the profit and loss accounts for each period. The reported profit for each period is not materially different from the profit on an unmodified historical cost basis. 5 Basic earnings per share is calculated using the profit on ordinary activities after taxation and the weighted average number of ordinary shares in issue during the period less the weighted average number of shares held by the Galliford Employee Share Trust. For diluted earnings per share, the basic weighted average number of shares is adjusted to assume conversion of all potential dilutive ordinary shares. The company has only one category of potential dilutive ordinary shares - those share options granted to employees where the exercise price is less than the average market price of the company's shares during the period. 6 The interim dividend of 0.5p per share will be paid on 4 April 2000 to shareholders on the register at 10 March 2000. 7 Notes to the cash flow statement 6 months 6 months Year ended ended ended 30 June 1999 31 December 31 December 1999 1998 £'000 £'000 £'000 Reconciliation of operating profit to cash flows Operating profit 2,568 1,507 5,487 Depreciation 393 387 814 Loss/(profit) on disposal of 2 (6) (112) tangible fixed assets Amortisation of own shares 40 16 45 held Amortisation of goodwill 8 - 2 Increase in stocks (6,399) (3,373) (3,571) Decrease/(increase) in 1,491 (1,718) (4,722) development land (Increase)/decrease in (3,934) 1,365 (2,582) debtors Increase/(decrease) in 9,314 (1,216) 2,612 creditors (Decrease)/increase in development land creditors (4,485) 239 3,877 (1,002) (2,799) 1,850 Notes (continued) 8 Analysis of net debt At 31 At 1 July December 1999 Cash flow 1999 £'000 £'000 £'000 Net bank overdraft (1,406) (4,282) (5,688) Loan notes (1,102) 26 (1,076) Bank loans (383) 307 (76) (2,891) (3,949) (6,840) Finance lease obligations (113) 19 (94) Net debt (3,004) (3,930) (6,934) 9 Reconciliation of net cash flow to movement in net debt 6 months 6 months Year ended ended ended 30 June 1999 31 December 31 December 1999 1998 £'000 £'000 £'000 Decrease in cash in period (4,282) (10,594) (8,770) Cash used to repay debt and 352 6,082 6,569 lease financing Change in net debt resulting (3,930) (4,512) (2,201) from cash flows Inception of finance lease - (112) (112) contracts Movement in net debt in the (3,930) (4,624) (2,313) period Net debt at start of period (3,004) (691) (691) Net debt at end of period (6,934) (5,315) (3,004) 10 Copies of the interim statement are being sent to shareholders on 10 March 2000 and further copies are available from the registered office of Galliford plc, Wolvey, Hinckley, Leicestershire LE10 3JH.

Companies

Galliford Try (GFRD)
UK 100
FTSE quotes by TradingView

Latest directors dealings

All directors dealings today