Final Results
Kingspan Group PLC
08 March 2005
KINGSPAN GROUP PLC
RESULTS FOR THE YEAR ENDED 31 DECEMBER 2004
Results Highlights
2004 2003 % Change
Turnover €958.1mn €783.9mn 22%
Operating profit €102.2mn €79.4mn 29%
(before goodwill amortisation)
Operating profit €94.2mn €71.5mn 32%
Net profit before tax €88.0mn €65.4mn 34%
Basic earnings per share 42.3 €cent 31.2 €cent 36%
Adjusted earnings per share 47.0 €cent 36.0 €cent 31%
(before goodwill amortisation)
Dividend per share for the year 9.6 €cent 7.2 €cent 33%
Dividend cover 4.9 times 5.0 times
(before goodwill amortisation)
Interest cover 20.3 times 16.8 times
Gearing ratio 35.6% 48.6%
(net debt as % shareholders funds)
Eugene Murtagh, Chairman said to-day:
'Kingspan delivered strong growth performance in 2004 with turnover up 22%,
operating profits before goodwill amortisation up 29%, and earnings up 36%.
Almost all of this growth was organic. Trading conditions in all of our
geographic markets proved considerably more stable than in recent times. Strong
progress was made in all major Divisions, assisted by the resumption of growth
in our Raised Access Floors business. This was achieved despite dramatic
pressures on our input costs. Total combined capital spend, including
acquisitions and capex activity, amounted to €81.2 million.'
Results
Profit before tax was €88.0 million (2003: €65.4 million). Earnings attributable
to ordinary shareholders were €70.0 million (2003: €51.4 million). Cash
generation remained strong up 26% with earnings before interest, tax,
depreciation and amortisation (EBITDA) of €127.3 million (2003: €101.4 million).
Net debt at year end was €107.6 million, a reduction of €13.2 million from
€120.8 million at 31 December 2003. This reduction was achieved after net
capital investment during the year of €54.6 million, acquisitions of €26.6
million and after the receipt of €27 million (US$36 million) being the proceeds
from the Tate settlement. Gearing at 31 December 2004 was 36% (2003: 49%).
Dividends
Given the continued strong cash-flow, it is proposed to pay a final dividend of
6.2 cent per share, an increase of 35% on the 2003 final dividend of 4.6 cent.
This gives a total dividend for the year of 9.6 cent per share, an increase of
33% on 2003. This results in dividend cover of 4.9 times earnings before
amortisation, and 8.0 times earnings before interest, taxation, depreciation and
amortisation.
It is proposed to pay the final dividend on 10 June 2005, to shareholders on the
register on 18 March, 2005. It is the intention to continue with a progressive
dividend policy for 2005 in a manner compatible with the growth plans set out
later in this statement, so as to bring dividend cover to a level closer to
industry norms.
Board Changes
There were two new appointments to the Group Board during the year. David Byrne,
S.C. was appointed as Non-Executive Director to the Board on 1 January 2005.
Noel Crowe, Managing Director of the Environmental Containers Division was
appointed to the Board on 2 February 2004.
Tom Mulcahy, Non-Executive Director, retired from the Board on 31 May 2004.
Acquisitions
There were two acquisitions completed during 2004, an insulated door panel
business and a small bolt-on to the Environmental Containers Division. The
combined consideration for the businesses was €24.8 million. The larger of the
two, Apco, a door panel manufacturer in Belgium, was acquired in August 2004 for
a consideration of €15.4 million plus debt of €1.6 million. Kingspan already
manufactures door panels at its plant in Sherburn, North Yorkshire and this
production will be transferred to the Belgian facility in 2005. This will free
up capacity in Sherburn and achieve manufacturing efficiencies. Turnover from
Apco from date of acquisition to 31 December 2004 was €5.3 million.
In February 2005, the acquisition of the RCM group of businesses was completed
in the U.K. for an initial consideration of €22 million. RCM is a leading player
in the growing U.K. unvented cylinder market and will greatly complement the
Environmental Container Division's existing presence in that sector.
Innovating for the Future
Kingspan has a unique business model and while generally classified as being a
building products group, it has many factors that distinguish it from other
companies in the sector.
Kingspan Group is a leading edge provider of an integrated range of value added
building materials and solutions utilised in commercial and residential
construction in Ireland, the U.K., Continental Europe and the USA. Kingspan has
a successful record in developing integrated product solutions across a broad
range of categories differentiated by thermal efficiency, fire ratings, speed of
erection and structural and aesthetic quality. The Group's product suite is
designed to meet the ever increasing requirement of architects and developers
for holistic solutions, while adding value for building owners and occupants.
There is an ever increasing movement towards the use of Modern Methods of
Construction, geared towards reducing the need for on-site skills, and driven by
the need for greater penetration of low energy buildings. Many of Kingspan's
products and solutions are specifically designed to capitalise on this trend.
The Group continues to benefit from promoting greater environmental awareness.
Across all of its operations the Group markets a portfolio of products that
recognises and addresses these trends.
Strategy
Strong Market Positions
The Group is confident that it can continue to identify products, markets and
segments with high growth potential and that it has the ability to develop
strong positions within those segments. Kingspan has avoided competing for
market share in more traditional commodity building materials that lack
opportunity for developing differentiated market positions. Kingspan has the
ability to drive the development of specialised materials applications from
initial niche positions into mainstream products through various enhancements
such as improvements in product lifespan, strength, thermal quality, and fire
retardation, while at the same time fitting into its concept for Off-Site
solutions. Kingspan believes that the achievement of a top market position in a
product and geographic market brings substantial competitive advantages and
reduces operating and financing risks to the Group. Kingspan's focus can allow
it achieve strong market positions for each of its core product offerings within
each targeted geographic market, rather than be active across a large range of
geographic operations with limited market share. The Group measures its success,
in part, by its ability to develop large, profitable market shares and this will
continue to be the case.
Capitalise on environmental regulation
The Group's products are at the forefront of changes in the building materials
industry that are being driven by economics, regulation, safety, aesthetics, and
a move towards Modern Methods of Construction. In the context of an evolving
market environment, Kingspan is deliberately focused on the development of
value-added products for its customers.
Kingspan embraces and actively promotes a trend toward enhanced environmental
consciousness. Kingspan has seen the increased focus on environmental issues and
the demands that it presents as an opportunity to utilise its strength in
innovation to tailor products to suit the evolving needs of the market rather
than view them as barriers to enhanced efficiency or the growth of its business.
Leveraging technology
While the Group has a core strategy of having a strong market position in any
product, it is also careful to permit flexibility to allow for innovation and
new product development.
Kingspan's strong market positions and large manufacturing base allow it the
opportunity to incubate new products with very limited costs. This incubation
opportunity provides the Group with product development options that carry
relatively low risk. Once a product is incubated, it can be test-manufactured
and marketed with relative ease and low costs. Once the market has accepted the
product, it can be put into low-scale production, and then ramped up as demand
improves.
Brands synonymous with products
Kingspan has become synonymous with high value added product categories through
marketing campaigns that focus on issues relating to the environment, energy and
cash pay-back period. As part of these campaigns, end users have come to
identify Kingspan as being closely associated with certain products. These
associations often extend across regions and product types. In this respect, the
Group is unique in the sector.
Modern Methods of Construction
Kingspan has sought to achieve and maintain a 'first mover' status in the
construction market's move towards Modern Methods of Construction. The shortage
of wet-trades, individuals, skilled or semi-skilled, active in the construction
trades such as cement or bricklaying, has become particularly acute in the U.K.
and to a lesser extent in Ireland. Kingspan anticipated the development and
acceleration of this trend in the U.K. Early in the life of this trend, the
Group sought to develop a product suite that would service this changing market,
and invested heavily to have appropriate products available in the marketplace.
Kingspan has believed for some time that Modern Methods of Construction were
relevant to industrial, commercial and the institutional building sectors. More
recently, the Group has seen a particularly attractive set of opportunities in
the domestic housing market. Kingspan has strategically positioned itself in the
market place with the development of its TEKHaus(R). Scale has been an
inhibiting factor in the utilisation of Off-Site solutions in the domestic
housing market and it is Kingspan's intention to address this market with an
enhanced and complementary range of products that can be produced on a larger
scale than heretofore. The Group sees opportunities to add to its product range
and, in the process, open up a much larger target market.
Outlook
The macro environment in which Kingspan operates has continued to improve
through the second half of 2004 and into the opening quarter of 2005. The Group
is continuing to benefit from the strategy set out above.
Product development supported by timely capital expenditure and appropriate
acquisitions gives the Group confidence in the future ahead, notwithstanding the
fact that there will be varying pressures from increased competition in some
areas and upward pressure on raw material prices in other areas. The Group feels
that the appropriateness of its products to the current construction environment
will help it achieve good growth going forward.
CHIEF EXECUTIVE'S REVIEW
Overall, 2004 was a very positive year for the Group. Strong organic growth was
achieved across the main divisions while the general construction climate proved
healthier than in recent years. During the period the Group witnessed some of
the most significant upward movements in raw material costs ever experienced by
its industry. These increases, driven by the steel and chemical sectors, were in
the order of €30 million. These were passed on to the marketplace. Further
increases are anticipated during 2005 and the Group's approach will be to
recover these from the market. Despite this turbulence in costs, 2004 marked a
number of noteworthy achievements:
1) EBITA exceeded €100 million for the first time and year-on-year earnings
growth was 36%;
2) Substantial capacity was added to enable continued organic development
of the Group;
3) Exceptionally high revenue growth at both Insulated Panels and
Insulation Boards, by 30% and 28% respectively;
4) New product penetration improved significantly. Related revenue is now
€40 million;
5) The acquisition of Apco, now Kingspan Door Components, a dedicated
insulated door panel company in Belgium;
6) An improvement in activity in the access floors business.
Insulated Panels
The Insulated Panels business continued to build on the progress made in 2003,
and posted sales growth of 30%. Growth was achieved in all geographic regions in
which this business is present. In the U.K. volumes grew by 16% compared to a
market growth of 5%. Penetration of the insulated metal cladding sector reached
53% and it is the Group goal to drive that conversion towards 70% by 2008. This
aim should be somewhat boosted by an environmentally geared revision to the U.K.
building codes in 2006. The Group's primary U.K. panel facility at Holywell,
North Wales, which was the subject of a circa €15 million capacity expansion
during 2004 will facilitate this demand. This plant now houses the world's
highest output insulated roof panel line.
The Group's business in the Benelux region reversed the pressures of recent
years by significantly outgrowing the sector's overall performance.
In Central and Eastern Europe (CEE), the Group further consolidated its position
and grew sales by 29%. Growth occurred in all CEE markets and plans for the
Region will be furthered by the addition of a €12 million greenfield plant in
Hungary that goes into production in Quarter 2 this year.
In Quarter 3 2004 Apco, an insulated door panel business in Belgium, was
acquired. Combined with existing door panel volumes, the revenue from this
dedicated Belgian facility is expected to exceed €20 million this year.
Insulation
During 2004 the rigid insulation board business in the U.K. and Ireland
continued to grow share primarily against traditional forms of insulation. Now
representing 21% of Group turnover, this division's sales grew by 28% over prior
year. This rapid pace of growth was enabled by capacity related capital
investment of €22.2 million over the past 2 years and although the rate of
growth can be expected to slow somewhat this year, 2006 should see a return to
double digit volume increase driven by the next revision to the building
regulations.
The mainland European phenolic insulation board business, based in Kestern, The
Netherlands, continued gaining traction against a relatively lack lustre market.
Overall this business performed solidly during 2004. Further phenolic product
development initiatives will in time enhance the attractiveness of this insulant
for more mainstream markets.
Off-Site & Structural
Representing 12% of Group turnover in 2004, this business's sales grew by 28%.
The rate of growth far exceeded that of recent years driven in the main by four
factors:
- double digit volume growth in its key products;
- upbeat U.K. structural steel environment;
- inflationary growth reflecting significant steel increase;
- positive market reception of the 'Off-Site' product suite.
Off-Site building solutions have been at the core of the Group strategy for some
time now, evidenced in particular from the success of Insulated Panel in
converting markets from site assembled alternatives. TEKHaus(R), arguably the
lowest energy home construction available, is gaining ground in a market that is
increasingly conscious of highly efficient building solutions and methods. In
this product, revenue in 2004 grew by 43%.
The current investment of €10 million at the Group's Off-Site manufacturing
facility in Sherburn, North Yorkshire, is the next phase in deepening the
Group's capability of providing the market with more fully integrated Modern
Methods of Construction and Off-Site solutions. The U.K. Government, in
particular, is strongly encouraging the increased usage of Modern Methods of
Construction. The opportunities that exist for Kingspan to position itself at
the forefront of this sector can be significant for the Group as a whole.
Environmental Containers
This division, representing 15% of Group turnover, put in a typically robust
performance. Sales increased by 11%. The shift in our product mix towards more
value-added environmental solutions provided much of the growth and is
reflective of the overall pattern within the fuel storage sector. For Kingspan,
this has been led by the U.K. market where now more than 30% of domestic fuel
tanks are 'twin-walled' for enhanced leak protection, and more than 70% of
applications now use the Group's value-adding Watchman(R) telemetry systems. It
is anticipated that this trend will continue not only in the U.K., but in
Ireland which currently lacks the environmental legislation necessary to ensure
safer storage solutions. Capacity is being added in the Division to capitalise
on this trend.
The Polish based mainland European business has built upon the progress made
since its establishment 5 years ago and is now moving towards a leading position
in Scandinavia, where conversion from traditional metal to plastic tanks is in
the early phases. This business grew by 50% over the prior year.
Until recently, Kingspan occupied only a niche presence in the U.K. unvented
cylinder market. The acquisition of RCM, however, completed in February 2005 for
an initial consideration of €22 million, now firmly positions this Division as a
leading provider to this expanding market.
Raised Access Floors
Sales of raised access flooring represented 12% of Group turnover in the year
under review. At €119 million, sales were up 3% in the year compared to 2003.
This sales trend recovery was due to a strong rebound in the performance of the
US business. Revenue grew there by 40% to €54 million or by 54% in US$ terms.
Despite the fact that the overall market for high rise commercial office
construction was weak, conversion to raised access floors versus traditional
floors continued apace and penetration now stands at approximately 13%.
In the U.K., sales continued to decline. Revenues reduced by 15% to €65 million
and the business broke even. The pace of this slow-down decreased as the year
progressed and early figures for 2005 indicate a more stable market environment.
Current market activity hints at some degree of recovery during 2006. Both the
US and U.K. operations have undergone significant cost restructuring over the
past few years and are both well positioned to profitably capitalise on any
upturn in the general high-rise construction sector.
Research & Development
Research and development has been at the core of the Group's success in the
recent past. The proprietary technology used primarily within the Insulated
Panel and Insulation Board businesses has played a very significant role in
advancing the Group's position as the leading supplier of high performance
'FireSafe' solutions to the construction industry. The Group is focused on a €30
million medium-term pipeline of developments ranging from basic materials
technology, to Modern Methods of Construction, to thermal performance with an
increasing emphasis on sustainability and renewability of building solutions.
These initiatives are all geared towards sustaining the Group's advantage over
traditional materials and solutions used within the construction industry.
Conclusion
The overall construction environment in which the Group operates is more
encouraging than it has been for some time. The Group's strategy and Operations
are geared fully towards providing further organic growth, complemented by a
degree of acquisition activity.
FINANCIAL REVIEW
Results
Turnover for the year ended 31 December 2004 was €958.1 million, up 22% compared
to the previous year. Acquisitions in the year generated €5.3 million additional
turnover.
Profit before tax was €88.0 million (2003: €65.4 million). Earnings attributable
to ordinary shareholders were €70.0 million (2003: €51.4 million). Cash
generation remained strong with earnings before interest, tax, depreciation and
amortisation (EBITDA) of €127.3 million (2003: €101.4 million). Goodwill
amortisation amounted to €7.9 million (2003: €7.9 million).
Turnover and Margins
Group turnover increased by 22% or €174.2 million compared to 2003.
The Tables below detail the Group's Turnover by Class of Activity and
Geographical Area and the year on year growth achieved.
Analysis by Class of Activity
Year ended Year ended % Change €'mn
31.12.04 31.12.03 2004-2003 increase
€'mn €'mn
Insulated Panels 380.2 292.5 +30% +87.7
Raised Access Flooring 119.2 115.7 +3% +3.5
Insulation Boards 199.4 155.8 +28% +43.6
Environmental Containers 142.5 128.4 +11% +14.1
Structural & Off-Site 116.8 91.5 +28% +25.3
958.1 783.9 +22% +174.2
Year ended Year ended % Change
31.12.04 31.12.03 2004-2003
€'mn €'mn
Republic of Ireland 136.8 105.8 +29%
Britain and Northern
Ireland 592.4 494.8 +20%
Mainland Europe 163.2 126.4 +29%
United States of America 53.6 36.8 +46%
Other 12.1 20.1 -40%
958.1 783.9 +22%
The gross profit margin, being gross profit as a percent of turnover, was 29.5%
in the year, down marginally from 29.6% last year. There was an improvement in
the second half of the year to 29.7% compared to 29.2% in the first half.
The operating margin, being earnings before interest, tax and goodwill
amortisation as a percent of turnover, was 10.7% in the year, up from 10.1% last
year. Again the trend has been positive throughout the second half of the year,
increasing from 10.1% in the first half to 11.2% in the second half of the year.
Taxation
The effective tax rate, calculated on earnings before goodwill amortisation, was
18.8% compared to 19.0% in 2003.
Earnings Per Share
Basic Earnings per share at 42.3 cent shows an increase of 35.6% over the
previous year. Basic earnings per share before goodwill amortisation at 47.0
cent show an increase of 30.6% over the previous year. Adjusted earnings per
share have grown at an annual compound rate of 9.8% over the period 1994 to
2004.
Dividends
The regular dividend for 2004 is 9.6 cent per share. This consists of an interim
dividend of 3.4 cent per share paid on 15 October 2004, and a final dividend of
6.2 cent per share proposed to be paid on 10 June 2005 to shareholders on the
register on 18 March 2005. This represents a 33% increase on the previous year.
The dividend for the year is covered 4.9 times by earnings before amortisation,
and 8 times earnings before interest, taxation, depreciation and amortisation
compared to 8.5 times in 2003. The dividend yield for the year was 1.9% compared
to 2.7% for 2003 based on the average share price in the relevant years.
The regular dividend has grown at an annual compound rate of 27.6% over the
period 2000 through to 2004. It is the strategy of the Group to continue with a
progressive dividend policy so as to bring dividend cover to a level closer to
industry norms.
Funds Flow
The table below summarises the Group's funds flow for 2004 and 2003:
2004 2003
€'m €'m
Operating profit 94.2 71.5
Depreciation 24.5 21.5
Amortisation 8.6 8.4
Working capital increase (35.0) (25.1)
Interest (6.6) (6.5)
Taxation paid (14.8) (8.9)
Others 12.6 (0.6)
Free cash 83.5 60.3
Acquisitions (26.6) (7.6)
Receipt of Tate settlement 24.7 0.0
Net capital expenditure (54.6) (36.3)
Dividends paid (13.2) (30.3)
Others 0.0 (0.2)
(69.7) (74.4)
Cash flow movement 13.8 (14.1)
Debt translation (0.6) 10.6
Decrease/(increase) in net debt 13.2 (3.5)
Net debt at start of year (120.8) (117.3)
Net debt at end of year (107.6) (120.8)
The acquisitions during the year were financed out of Group resources. Debt
reduction before acquisitions, dividend payments and non-cash translation effect
was €53.6 million (2003: €23.8 million).
The free cash flow for the year, representing operating cash flow less interest
and taxation paid, amounted to €83.5 million, an increase of €23.2 compared to
€60.3 million in 2003. This performance represents 50.4 cent per share (2003:
36.5 cent). Over the two years 2003 and 2004, a total of €143.8 million in free
cash was generated of which €90.9 million was spent on net capital expenditure.
Operational working capital at the year end was €154.2 million (2003: €116.5
million) and represented 16.1% of turnover (2003: 14.9%), against a company
target of 15.0%. The increase in working capital percentage reflects a busy
trading end to the year. Working capital days (which takes into account the
phasing of sales) has improved from 37 days in 2003 to 33 days in 2004.
Return on Capital Employed
The return on capital employed, being profit before interest and taxation as a
percentage of shareholders' funds plus net debt at the year end, was 23.0%
compared to 19.4% in 2003. If goodwill previously written off of €80.7 million
was still on the balance sheet, the corresponding figures would be 20.1% in 2004
and 18.1% in 2003.
Treasury
At 31 December 2004, the Group had syndicated bank facilities of €350 million
and €60 million of overdraft and other facilities. The syndicated facilities are
comprised of a €125 million 5 year term loan; a €125 million 5 year revolving
credit; and a €100 million 364 day facility with a 4 year term option.
The drawn down facilities at 31 December 2004 were €181.2 million, comprising
€107.6 million EUR debt and €73.6 million of STG debt.
It is Group policy to enter into interest rate hedging to limit interest rate
exposure on a proportion of the Group's medium to long term debt. Approximately
51% of the net debt is subject to interest rate swaps, at 2.94% on the EUR debt
and at 4.97 % on the STG debt, both swaps expire on 31 December 2006.
Currently the Group does not enter into any external hedges to limit the
exposure on translating non-Euro earnings.
Foreign exchange transaction exposure is internally hedged as far as possible
and to the extent that they are not, such residual exposures are hedged on a
rolling 12 month basis.
Tate Settlement
A settlement had been reached with the former shareholders of Tate Global
Corporation with respect to a dispute arising from the sale of Tate Global
Corporation to Kingspan in January 2001.
The settlement included a US$36 million reduction to the purchase price of the
stock of Tate Global Corporation. These funds were received on 29 December 2004
and booked by Kingspan in the 2004 accounts. This translates to €27 million, of
which €24.7 million reduced goodwill and the balance was applied to legal and
other costs.
Pension Deficit
The Group's pension deficit relates to two legacy defined benefit schemes in the
U.K.. All of these schemes have been closed and the liability relates only to
past service. As at 31 December 2004, the pension liability, net of tax, of the
Group amounted to €15.9 million compared to €12.1 million at 31 December 2003,
and reflects a change in underlying assumptions in the full actuarial valuations
completed as at the year end.
Summary
Overall the Group is in a strong financial position going into 2005 and is well
positioned for continued growth. The balance sheet is conservatively geared and
this will enable the Group to comfortably fund its anticipated growth, through
both organic means and bolt on acquisitions.
Contact:
Donnchadh O'Neill
Murray Consultants
Tel: + (353 1) 4980 300
Tim Thompson/Jeremy Garcia/Tom Carroll
Buchanan Communications
Tel: + (44) 207 466 5000
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31ST DECEMBER 2004
Continuing
Operations Acquisitions Total Total
2004 2004 2004 2003
€'000 €'000 €'000 €'000
Turnover 952,753 5,330 958,083 783,894
Cost of sales (671,748) (3,981) (675,729) (551,542)
--------- ---------- -------- --------
Gross profit 281,005 1,349 282,354 232,352
Distribution costs (59,269) 0 (59,269) (48,990)
Administrative expenses (119,910) (997) (120,907) (103,972)
--------- ---------- -------- --------
Operating profit before goodwill 101,826 352 102,178 79,390
amortisation
Goodwill amortisation (7,669) (268) (7,937) (7,933)
--------- ---------- -------- --------
Operating profit 94,157 84 94,241 71,457
--------- ---------- -------- --------
Interest payable and similar charges (7,144) (6,802)
Interest receivable and other income 873 786
-------- --------
Profit on ordinary activities before
taxation 87,970 65,441
Tax on profit on ordinary activities (17,993) (13,959)
-------- --------
Profit on ordinary activities after
taxation 69,977 51,482
Minority interest (2) (74)
-------- --------
Profit attributable to ordinary
shareholders 69,975 51,408
Ordinary dividends (15,930) (11,896)
-------- --------
Profit retained for the year 54,045 39,512
-------- --------
Basic earnings per share 42.3 c 31.2 c
Basic earnings per share (before
goodwill amortisation) 47.0 c 36.0 c
Diluted earnings per share 41.5 c 30.9 c
GROUP BALANCE SHEET 2004 2003
AS AT 31ST DECEMBER 2004 €'000 €'000
FIXED ASSETS
Tangible assets 211,813 176,140
Intangible assets 104,282 122,487
Financial assets 38 49
-------- --------
316,133 298,676
-------- --------
CURRENT ASSETS
Stocks 89,225 61,708
Trade and other debtors 220,643 175,957
Cash and term deposits 87,791 55,746
-------- --------
397,659 293,411
-------- --------
CREDITORS
Amounts falling due within one year
Trade and other creditors 176,029 139,613
Bank and other borrowings 108,217 46,298
Deferred consideration 597 85
Dividends 10,300 7,608
-------- --------
295,143 193,604
-------- --------
NET CURRENT ASSETS 102,516 99,807
-------- --------
TOTAL ASSETS LESS CURRENT LIABILITIES 418,649 398,483
-------- --------
CREDITORS
Amounts falling due after more than one
year
Bank and other borrowings 76,136 126,116
Deferred consideration 10,463 4,067
-------- --------
86,599 130,183
PROVISIONS FOR LIABILITIES AND CHARGES 27,813 17,605
CAPITAL GRANTS 915 999
-------- --------
303,322 249,696
-------- --------
CAPITAL AND RESERVES
Called-up share capital 21,797 21,711
Share premium account 20,260 18,761
Revaluation reserve 891 891
Profit and loss account 294,011 239,965
Other reserves (34,818) (32,896)
-------- --------
Shareholders' funds 302,141 248,432
-------- --------
MINORITY INTERESTS
Including non-equity interests 1,181 1,264
-------- --------
303,322 249,696
-------- --------
GROUP CASH FLOW STATEMENT 2004 2003
FOR THE YEAR ENDED 31ST DECEMBER 2004 €'000 €'000
Net cash inflow from operating 103,429 75,698
activities
-------- --------
Returns on investments and servicing of
finance
Interest received 875 794
Interest paid (7,452) (7,294)
Interest element of finance lease
rental payments (20) (3)
-------- --------
Net cash outflow from returns on
investments and servicing of finance (6,597) (6,503)
-------- --------
Taxation
Corporation tax paid (14,826) (8,909)
-------- --------
Capital expenditure and financial
investment
Purchase of tangible fixed assets (56,695) (39,690)
Less new finance leases 82 0
Proceeds on sale of financial fixed
assets 11 0
Proceeds on sale of tangible fixed
assets 2,124 3,374
-------- --------
Net cash outflow for capital expenditure and
financial investment (54,478) (36,316)
-------- --------
Acquisitions and disposals
Purchase of subsidiary undertakings (18,050) (7,478)
Receipt of Tate Global Corporation settlement 24,680 0
Net cash acquired with acquisitions 954 728
Payment of deferred consideration in respect of
acquisitions (629) (734)
-------- --------
Net cash inflow/(outflow) for acquisitions and 6,955 (7,484)
disposals -------- --------
Equity dividends paid (13,237) (30,322)
-------- --------
Cash inflow/(outflow) before use of liquid
resources and financing 21,246 (13,836)
-------- --------
Management of liquid resources
Decrease in bank deposits 9,301 3,400
-------- --------
Financing
Issue of shares 1,585 627
Increase in term debt 8,994 1,212
Capital element of finance lease repayments (5) (37)
Capital grants received 20 7
Acquisition of shares held by minorities 0 (418)
Dividends paid to minorities (91) (288)
-------- --------
Net cash inflow from financing 10,503 1,103
-------- --------
Increase/(Decrease) in cash for the
year 41,050 (9,333)
-------- --------
GROUP CASH FLOW STATEMENT 2004 2003
FOR THE YEAR ENDED 31ST DECEMBER 2004 €'000 €'000
Reconciliation of net cash flow to
movement in net debt
Increase/(Decrease) in cash for the
year 41,050 (9,333)
Decrease in liquid resources (9,301) (3,400)
Cash flow from movement in debt, lease finance & deferred
consideration (8,360) (441)
-------- --------
Change in net debt resulting from cash flows 23,389 (13,174)
Loans and finance leases acquired with subsidiaries (2,054) (246)
Deferred consideration arising on acquisitions
during the year (7,456) (646)
New finance leases (82) 0
Translation adjustment (598) 10,552
-------- --------
Movement in net debt in the year 13,199 (3,514)
Net debt at start of year (120,820) (117,306)
-------- --------
Net debt at end of year (107,621) (120,820)
-------- --------
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES 2004 2003
FOR THE YEAR ENDED 31ST DECEMBER 2004 €'000 €'000
Profit for financial year attributable
to Group shareholders 69,975 51,408
Exchange adjustments (1,922) (27,611)
-------- --------
Total gains and losses recognised since last
annual report 68,053 23,797
-------- --------
SUPPLEMENTARY INFORMATION
1 REPORTING CURRENCY
The financial statements are presented in Euro. Results and cash flows of
foreign subsidiary undertakings have been translated into Euro at the
average exchange rates, and the related balance sheets have been translated
at the rates of exchange ruling at the balance sheet date.
Exchange rates used were as follows: Average rate Year end rate
Euro = 2004 2003 2004 2003
Pound Sterling 0.679 0.692 0.693 0.705
US Dollar 1.244 1.132 1.335 1.240
Czech Koruna 31.953 31.894 30.600 32.500
Polish Zloty 4.534 4.400 4.100 4.640
2 TURNOVER 2004 2003
€'000 €'000
The analysis by class of activity is as follows:
Composite panels 380,192 292,530
Raised access flooring 119,238 115,681
Insulation boards 199,395 155,768
Environmental containers 142,462 128,413
Off- Site & structural 116,796 91,502
-------- --------
958,083 783,894
-------- --------
2004 2003
€'000 €'000
The analysis by geographical area is as follows:
Republic of Ireland 136,769 105,799
Britain and Northern Ireland 592,363 494,743
Mainland Europe 163,221 126,410
United States of America 53,636 36,825
Other 12,094 20,117
-------- --------
958,083 783,894
-------- --------
3 DIVIDENDS 2004 2003
Ordinary dividends
Paid: Interim dividend 3.40c per share (2003: 2.60c per
share) on 165,592,828 shares 5,630 4,288
Payable: Final dividend 6.20c per share (2003: 4.60c per
share) on 166,121,748 shares 10,300 7,608
-------- --------
15,930 11,896
-------- --------
The Board is recommending the payment of a final dividend of 6.20c per share subject to
shareholder approval to shareholders registered at close of business on 18 March 2005.
4 RECONCILIATION OF MOVEMENTS IN 2004 2003
SHAREHOLDERS' FUNDS €'000 €'000
Profit for the financial year attributable to
Group shareholders 69,975 51,408
Dividends (15,930) (11,896)
-------- --------
54,045 39,512
Exchange adjustments (1,922) (27,611)
New share capital subscribed 1,586 627
-------- --------
Net addition to shareholders' funds 53,709 12,528
Opening shareholders' funds 248,432 235,904
-------- --------
Closing shareholders' funds 302,141 248,432
-------- --------
5 RECONCILIATION OF OPERATING PROFIT TO 2004 2003
NET CASH FLOW FROM OPERATING ACTIVITIES €'000 €'000
Operating profit 94,241 71,457
Depreciation charges 24,498 21,511
Amortisation of intangible assets 8,606 8,407
Profit on sale of tangible assets 1,161 (426)
Government grants amortised (128) (102)
(Increase) in stocks (21,838) (4,685)
(Increase) in debtors (39,780) (17,749)
Increase/(Decrease) in creditors 36,669 (2,715)
-------- --------
103,429 75,698
-------- --------
6 EARNINGS PER SHARE 2004 2003
€'000 €'000
The calculations of earnings per share are based
on the following:
Profit attributable to ordinary 69,975 51,408
shareholders -------- --------
Number Number
of of
shares shares
('000) ('000)
Weighted average number of ordinary shares for the calculation of basic
earnings per share 165,621 164,984
Dilutive effect of share options 3,025 1,425
-------- --------
Weighted average number of ordinary shares for the calculation of diluted
earnings per share 168,646 166,409
-------- --------
€ Cent Cent
Basic earnings per share 42.3 31.2
-------- --------
Diluted earnings per share 41.5 30.9
-------- --------
Basic earnings per share before 47.0 36.0
goodwill amortisation -------- --------
7 ABBREVIATED ACCOUNTS
The 2004 financial information is an abridged version of the Group's financial statements which have
not yet been filed with the Registrar of Companies but upon which the auditors have given an unqualified audit
report. The 2003 figures are an extract from the Group's statutory accounts for the year ended 31 December 2003
which have been filed with the Registrar of Companies and audited and reported upon without qualification.
8 DISTRIBUTION OF THIS PRELIMINARY ANNOUNCEMENT
These results are available on the Group's website at www.kingspan.com. A printed copy is available to the public at
the Company's registered office or from the Company's Registrars: Computershare Services (Ireland) Limited,
Heron House, Corrig Road, Sandyford Industrial Estate, Dublin 18.
This information is provided by RNS
The company news service from the London Stock Exchange
RORUR
Friday, 22nd November 2024
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