Final Results
Holders Technology PLC
19 February 2008
Holders Technology plc
Providers of specialised materials, equipment and services to the electronics
industry
Audited results for the year ended 30 November 2007
Holders Technology plc announces its audited results for the year ended 30
November 2007.
2007 was a year of solid progress for the group, with improved profitability and
strong cash flow.
• Operating profit grew 20% to £1.2m
• Revenue was steady at £18.9m
• £2.0m cash generated from operations
• Indian Joint Venture established
• Proposed 8.3% increase in final dividend to 3.25p
Chairman's statement
The improved trading performance achieved in the first half of the year was
matched in the second half of the year leading to a positive out turn for the
year to 30 November 2007. Given the successful trading in the year, your board
considers it appropriate to recommend a final dividend of 3.25p (2006 3.00p).
Operating profit of £1.2m (2006: £1.0m) combined with tight control of working
capital led to £2.0m (2006: £0.6m) of cash being generated from operations,
before tax payments. The group has maintained a strong balance sheet, with net
cash of £1.1m at the end of the year.
The UK operations traded strongly while our German and Dutch operations broadly
held their ground during a period which saw worldwide rises in the price of
copper and aluminium foils, product lines of particular importance to our German
subsidiary. The continuing marked contraction of the Scandinavian PCB market
inevitably impacted adversely on our Swedish subsidiary, but strict control of
overheads enabled the company to breakeven at operating profit level and to hold
the pre tax loss to an immaterial amount.
Our Indian joint venture, which commenced trading only in April 2007, achieved
pre tax breakeven albeit on modest levels of turnover. We believe that the
Indian market has excellent potential to grow over the medium term and that our
entry into the market at this stage makes us well placed to benefit from the
anticipated growth of this market in future years.
The Chinese PCB industry continues to expand and is now the world's premier PCB
producer. We will continue our investment programme to address this market
opportunity. Taken together, our Chinese activities achieved breakeven at the
pre tax level in the year.
We are appraising opportunities further to develop the company's business in
areas complementary to our existing core activity of supplying the PCB industry.
A number of opportunities have been examined, but as yet we have been unable
to identify a suitable proposition available on terms which we consider
attractive to shareholders. The continuing strength of our balance sheet
coupled with our strong banking relationships would enable us to complete
suitable transactions and it is now clear that the range of possible
opportunities both justifies and requires a greater level of management
commitment. To this end Victoria Blaisdell, who has served as the Group's IT
Director for the past three years, has been appointed to the Company's board as
Corporate Development Director in order to enable us to devote more resource to
this process.
The move to restructure our operations in order to devolve responsibility to the
operating subsidiaries has been successfully completed and on behalf of the
board I would like to thank staff for their efforts during the year, sometimes
in trying circumstances.
There are clear signs that economic activity in Europe is weakening and we are
basing our plans on the assumption that demand in our main markets in 2008 will
be lower than in 2007. We will seek rigorously to contain our costs so as to
minimise the impact of this expected lower level of activity on our
profitability while continuing to invest in our young subsidiaries in the growth
economies of India and China and seeking to make selective, earnings enhancing
acquisitions.
If approved by shareholders at the AGM, we will pay the dividend on 20 May 2008
to shareholders on the register on 25 April 2008.
R W Weinreich
Chairman and Chief Executive
18 February 2008
Consolidated income statement
for the year ended 30 November 2007
Note 2007 2006
£'000 £'000
Continuing operations
Revenue 18,853 18,822
Cost of sales (13,866) (13,891)
Gross profit 4,987 4,931
Distribution costs (463) (446)
Administrative expenses (3,398) (3,561)
Deferred consideration arising on sale of former subsidiary - 39
Other operating income 76 38
Operating profit 1,202 1,001
Finance income 27 9
Finance expenses (23) (26)
Share of loss of associate - (25)
Profit before taxation 1,206 959
Taxation 2 (454) (390)
Profit after taxation 752 569
Attributable to:
Equity shareholders of the company 744 591
Minority interests - equity 8 (22)
Profit for the financial year 752 569
Total and continuing
Basic earnings per share 4 17.97p 14.24p
Diluted earnings per share 4 17.78p 14.24p
Consolidated balance sheet
at 30 November 2007
Note 2007 2006
£'000 £'000
Assets
Non-current assets
Goodwill 397 413
Property, plant and equipment 622 506
Investments in subsidiaries - -
Investment in joint venture - -
Investments in associates 28 119
1,047 1,038
Current assets
Inventories 2,645 3,153
Trade and other receivables 2,588 2,774
Current tax - 35
Deferred tax 49 35
Cash and cash equivalents 1,275 822
6,557 6,819
Liabilities
Current liabilities
Trade and other payables (1,399) (1,678)
Borrowings (174) (406)
Current tax (275) (260)
(1,848) (2,344)
Net current assets 4,709 4,475
Non-current liabilities
Borrowings - (4)
Retirement benefit liability (139) (94)
Deferred consideration (104) (104)
(243) (202)
5,513 5,311
Shareholders' equity
Share capital 3 416 416
Share premium account 3 1,531 1,531
Capital redemption reserve 3 1 1
Retained earnings 3 3,431 3,285
Cumulative translation adjustment 3 37 (84)
Equity attributable to the equity shareholders 5,416 5,149
Minority interests in equity 3 97 162
5,513 5,311
Consolidated cash flow statement
for the year ended 30 November 2007
2007 2006
£'000 £'000
Cash flows from operating activities
Operating profit 1,202 1,001
Share-based payment charge 12 8
Depreciation 288 208
Reduction in impairment re associate - (35)
Currency translation 102 (79)
Loss on sale of property, plant and equipment 1 1
(Increase)/decrease in inventories 508 (529)
(Increase)/decrease in trade and other receivables 231 (29)
(Increase)/decrease in trade and other payables (362) 76
Cash generated from operations 1,982 622
Corporation tax (paid)/refunded (418) (96)
Net cash generated from operations 1,564 526
Cash flows from investing activities
Proceeds from disposal of investment in associate 119 -
Increase in investment in existing subsidiary - (54)
Investment in new subsidiary - -
Investment in joint venture - -
Purchase of property, plant and equipment (403) (244)
Proceeds from sale of property, plant and equipment
15 29
Income from investments - -
Interest received 27 9
Net cash generated/(used) in investing activities (242) (260)
Cash flows from financing activities
Proceeds from issue of shares - 8
Purchase of treasury shares (398) -
Interest paid (23) (26)
Equity dividends paid (212) (197)
Finance lease principal payments (6) (16)
Net cash used in financing activities (639) (231)
Net change in cash and cash equivalents 683 35
Cash and cash equivalents at start of period 418 383
Cash and cash equivalents at end of period 1,101 418
Notes
1. Basis of preparation
The group financial statements have been prepared in accordance with EU endorsed
International Financial Reporting Standards (IFRS), International Financial
Reporting Interpretations Committee (IFRIC) interpretations and with those parts
of the Companies Act 1985 applicable to companies reporting under IFRS. All
accounting standards and interpretations issued by the International Accounting
Standards Board and the International Financial Reporting Interpretations
Committee effective at the time of preparing these financial statements have
been applied.
2. Taxation
2007 2006
£'000 £'000
Analysis of the charge in the period
Current tax
- Current period 381 367
- Adjustments in respect of prior periods 87 46
468 413
Deferred tax (14) (23)
Total tax 454 390
Tax reconciliation
The tax for the period is higher (2006: higher) than the standard rate of corporation tax in the
UK (30%). The differences are explained below:
2007 2006
£'000 £'000
Profit before taxation 1,206 959
Profit before taxation multiplied by rate of corporation tax in
the UK of 30% (2006: 30%) 362 288
Effects of:
Differences between capital allowances and depreciation (10) (12)
Amounts not deductible for taxation purposes - 70
Adjustments in respect of prior years 87 46
Taxation losses 15 13
Different overseas tax rates - (15)
Taxation 454 390
3. Statement of changes in shareholders' equity
Group Capital Cumulative
Share Share redemption translation Retained Shareholders' Minority Total
capital premium reserve adjustment earnings Equity interest equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 December 414 1,525 1 - 2,883 4,823 247 5,070
2005
Profit/(loss) for the - - - - 591 591 (22) 569
period
Dividends - - - - (197) (197) - (197)
Currency translation - - - (84) - (84) (31) (115)
differences
Shares issued during the 2 6 - - - 8 - 8
period
Share-based payment - - - - 8 8 - 8
credit
Minority interest - - - - - - (49) (49)
acquired
Investments by minority - - - - - - 17 17
interest
Balance at 30 November 416 1,531 1 (84) 3,285 5,149 162 5,311
2006
Profit/(loss) for the - - - - 744 744 8 752
period
Dividends - - - - (212) (212) - (212)
Purchase of treasury - - - - (398) (398) - (398)
shares
Currency translation - - - 121 - 121 (8) 113
differences
Share-based payment - - - - 12 12 - 12
credit
Transfer in respect of - - - - - - (49) (49)
associates
Balance at 30 November 416 1,531 1 37 3,431 5,416 113 5,529
2007
4. The directors have recommended a final dividend of 3.25p (2006: 3.00p)
per share payable on 20 May 2008 to shareholders on the register at close of
business on 25 April 2008. The total dividend for the year, including the
interim dividend of 2.1p (2006: 2.0p) per share paid on 18 September 2007,
amounts to £215,000 (2006: £208,000), which is equivalent to 5.35p (2006: 5.00p)
per share.
5. The basic earnings per share are based on the profit for the financial
year of £744,000 (2006: £591,000) and on ordinary shares 4,140,085 (2006:
4,149,236), the weighted average number of shares in issue during the year.
Diluted earnings per share are based on 4,183,680 ordinary shares (2006:
4,149,236), being the weighted average number of ordinary shares after an
adjustment of 43,595 shares (2006: nil) in relation to share options.
6. This preliminary statement which has been approved by the Board on 18
February 2008 is not the Company's statutory accounts. The statutory accounts
for each of the two years to 30 November 2006 and 30 November 2007 received
audit reports, which were unqualified and did not contain statements under
section 237 (2) or (3) of the Companies Act 1985. The 2006 accounts have been
filed with the Registrar of Companies but the 2007 accounts are not yet filed.
ENDS For further information, contact:
Mr Rudi Weinreich, Chairman and Chief Executive, Holders Technology plc,
on 020 8731 4336
Mr Jim Shawyer, Group Finance Director, Holders Technology plc,
On 020 8731 4336
Mr John Wakefield, Director, Corporate Finance, Blue Oar Securities Plc,
on 0117 933 0020.
Website www.holderstechnology.com
This information is provided by RNS
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