Half Yearly Results

RNS Number : 6594S

Latham(James) PLC

24 November 2011

 



James Latham plc

("James Latham" or the "Company")

HALF YEARLY RESULTS FOR THE PERIOD ENDED 30 SEPTEMBER 2011 

Chairman's statement

I am pleased to report good results for the six months to 30 September 2011. This is in spite of trading conditions in our markets which have continued to be difficult and, as predicted, margins have come under pressure, resulting in profits similar to last year.

Results

Revenue for the six months to 30 September 2010 was £74,207,000 compared to £65,985,000 for the same period last year, representing a 12% increase. The operating profit was £4,382,000, down from £4,463,000 last year. Finance Income was £26,000 (2010: £33,000) and Finance Costs were £249,000 (2010: £265,000). Profit before tax was £4,159,000, down from last year's £4,591,000 which included a one off additional receipt of £360,000 from the sale of the Clapton site in 2004/05. Earnings per ordinary share were 16.1p (2010: 17.8p).

As at 30 September 2011 shareholder funds were £44.7m (30.9.2010: £42.6m) with cash and cash equivalents of £3.9m (2010: £7.8m).

Interim dividend

The Board has declared an interim dividend of 3.0p per Ordinary Share (2010: 3.0p), which is covered 5.4 times (2010: 5.9 times). The dividend is payable on 25 January 2012 to ordinary shareholders on the Company's Register at close of business on 6 January 2012.  The ex-dividend date will be 4 January 2012.

Six months trading to 30 September 2011.

Group revenue has continued to increase on a like-for-like basis. This is the result of both higher prices and increased volumes. The growth in sales has been achieved in both timber and panel products. The recently purchased DLH UK Limited, now trading as LDT, a division of Lathams Limited, has produced results above our expectations.

Trading margins for the period July to September have come under pressure. Overheads have been well controlled, although staff numbers have been increased in areas where we see opportunities for growth. Record sales were achieved in August and September. Cash balances at the end of September were £3.9m. As already announced, we have purchased a new, bigger, site in Leeds. Work to fit out the unit is underway and the business will start transferring in December. We continue to take advantage of cash settlement discounts from suppliers where this represents a good return on our cash. 

Pension scheme

The IAS19 valuation shows that the scheme deficit has increased to £12.5m from £8.6m in March. This is mainly because the reduction in AA grade bond yields has increased the present value of pension scheme liabilities. This measure is however very volatile. The triennial actuarial valuation based on 31 March 2011 showed a deficit of £9m compared to £5m in March 2008. The trustees and the company have agreed a recovery plan to pay off the deficit over ten years.

Current & future trading

The management accounts and information show steady revenue for October and the first half of November, but margins are still under pressure.  Bad debts have been below last year's level but will remain a concern over the next few months. In this trading climate it is difficult to predict future trading patterns. Some customers still have full order books but there is less confidence than earlier in the year, however the directors still see opportunities to expand the business profitably.

Peter Latham

Chairman

24 November 2011

For further information please visit www.lathams.co.uk or contact:

James Latham Plc	Tel:  [phone]
Peter Latham, Chairman
David Dunmow, Finance Director
Northland Capital Partners - Nomad & Broker	Tel:  [phone]
Shane Gallwey / Tim Metcalfe

JAMES LATHAM PLC
CONSOLIDATED BALANCE SHEET
At 30 September 2011
	As at 30 Sept. 2011 unaudited	As at 30 Sept. 2010 unaudited	As at 31 March 2011 audited
	£000	£000	£000
ASSETS
Non-current assets
Goodwill	237	237	237
Intangible assets	127	135	131
Property, plant and equipment	21,588	18,749	18,536
Total non-current assets	21,952	19,121	18,904
Current assets
Inventories	25,399	22,432	24,771
Trade and other receivables	32,212	29,003	28,525
Cash and cash equivalents	3,881	7,757	7,113
Total current assets	61,492	59,192	60,409
Total assets	83,444	78,313	79,313
Current liabilities
Trade and other payables	20,094	21,156	20,316
Current portion of interest bearing loans and borrowings	340	21	11
Current tax payable	987	1,016	1,090
Total current liabilities	21,421	22,193	21,417
Non-current liabilities
Interest bearing loans and borrowings	3,347	988	987
Retirement and other benefit obligation	12,479	10,347	8,561
Other payables	676	820	705
Deferred tax liabilities	819	1,344	1,827
Total non-current liabilities	17,321	13,499	12,080
Total liabilities	38,742	35,692	33,497
Net assets	44,702	42,621	45,816
Capital and reserves
Issued capital	5,040	5,040	5,040
Share-based payment reserve	111	52	79
Own shares	(359)	(340)	(401)
Capital reserve	3	3	3
Retained earnings	39,907	37,866	41,095
Total equity attributable to equity shareholders of the parent company	44,702	42,621	45,816

JAMES LATHAM PLC
CONSOLIDATED INCOME STATEMENT
For the six months to 30 September 2011
	Six months to 30 Sept. 2011 unaudited	Six months to 30 Sept. 2010 unaudited	Year       to       31 March 2011 audited
	£000	£000	£000
Revenue	74,207	65,985	130,151
Cost of sales (including warehouse costs)	(61,091)	(53,778)	(106,422)
Gross profit	13,116	12,207	23,729
Selling and distribution costs	(5,872)	(5,251)	(10,405)
Administrative expenses	(2,892)	(2,539)	(5,346)
Other operating income	30	46	92
	(8,734)	(7,744)	(15,659)
Operating profit	4,382	4,463	8,070
Profit on disposal of property, plant and equipment	-	360	360
Finance income	26	33	106
Finance costs	(249)	(265)	(532)
Profit before tax	4,159	4,591	8,004
Tax expense	(1,086)	(1,189)	(2,120)
Profit after tax attributable to owners of the parent company	3,073	3,402	5,884
Earnings  per ordinary share (basic)	16.1p	17.8p	30.8p
Earnings  per ordinary share (diluted)	15.9p	17.7p	30.5p
All results relate to continuing operations.

JAMES LATHAM PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six months to 30 September 2011
	Six months to 30 Sept. 2011 unaudited	Six months to 30 Sept. 2010 unaudited	Year   to    31 March 2011 audited
	£000	£000	£000
Profit after tax	3,073	3,402	5,884
Other Comprehensive income
Actuarial losses on defined benefit pension scheme	(4,171)	(2,638)	(719)
Deferred tax relating to components of other comprehensive income	1,081	739	139
Other comprehensive income for the period, net of tax	(3,090)	(1,899)	(580)
Total comprehensive income, attributable to owners of the parent company	(17)	1,503	5,304

JAMES LATHAM PLC
CONSOLIDATED CASH FLOW STATEMENT
For the six months to 30 September 2011
	Six months to 30 Sept 2011 unaudited	Six months to 30 Sept 2010 unaudited	Year    to   31 March  2011audited
	£000	£000	£000
Net cash flow from operating activities (note 5)
Cash generated from operations	150	37	4,772
Interest paid	(210)	(226)	(9)
Income tax paid	(1,115)	(883)	(1,857)
Net cash (outflow)/inflow from operating activities	(1,175)	(1,072)	2,906
Cash flows from investing activities
Interest received and similar income	15	13	111
Purchase of property, plant and equipment	(3,560)	(855)	(1,004)
Purchase of intangible asset	-	-	(1)
Proceeds from sale of property, plant and equipment	9	-	2
Proceeds from prior year sale of property	-	360	360
Net cash outflow from investing activities	(3,536)	(482)	(532)
Cash flows before financing activities
Finance leases repaid	(11)	(10)	(21)
Borrowings received	2,700	-	-
Proceeds from borrowings	-	-	(3,924)
Equity dividends paid	(1,171)	(1,002)	(1,574)
Preference dividend paid	(39)	(39)	(79)
Purchase of own shares	-	(183)	(208)
Net cash inflow/(outflow) from financing activities	1,479	(1,234)	(5,806)
Decrease in cash and cash equivalents for the period	(3,232)	(2,788)	(3,432)
Cash and cash equivalents at beginning of the period	7,113	10,545	10,545
Cash and cash equivalents at end of the period	3,881	7,757	7,113

JAMES LATHAM PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
	Issued capital £000	Share-based payment reserve £000	Own shares £000	Capital reserve £000	Retained earnings £000	Total equity £000
As at 1 April 2010	5040	30	(203)	3	37,365	42,235
Profit for the year	-	-	-	-	5,884	5,884
Other comprehensive income:
Actuarial loss on defined pension scheme	-	-	-	-	(719)	(719)
Deferred tax relating to components of other comprehensive income	-	-	-	-	139	139
Total comprehensive income for the year	-	-	-	-	5,304	5,304
Transaction with owners:
Dividends	-	-	-	-	(1,574)	(1,574)
Change in investment in ESOP shares	-	-	(198)	-	-	(198)
Share-based payment expense	-	49	-	-	-	49
Total transactions with owners	-	49	(198)	-	(1,574)	(1,723)
Balance at 31 March 2011	5,040	79	(401)	3	41,095	45,816
Profit for the period	-	-	-	-	3,073	3,073
Other comprehensive income:
Actuarial loss on defined benefit pension scheme	-	-	-	-	(4,171)	(4,171)
Deferred tax relating to components of other comprehensive income	-	-	-	-	1,081	1,081
Total comprehensive income for the period	-	-	-	-	(17)	(17)
Transactions with owners:
Dividends	-	-	-	-	(1,171)	(1,171)
Change in investment in ESOP shares	-	-	42	-	-	42
Share-based payment expense	-	32	-	-	-	32
Total transactions with owners	-	32	42	-	(1,171)	(1,097)
Balance at 30 September 2011	5,040	111	(359)	3	39,907	44,702

JAMES LATHAM PLC
NOTES TO THE HALF YEARLY REPORT
1. The results presented in this report are unaudited and they have been prepared in accordance with the recognition and measurement of International Financial Reporting Standards ('IFRS') as adopted by the EU that are expected to be applicable to the financial statements for the year ending 31 March 2012 and on the basis of the accounting policies to be used in those financial statements.  The figures for the year ended 31 March 2011 are extracted from the statutory accounts of the group for that period.
2.  The directors propose an interim dividend of 3.0p per ordinary share which will absorb £571,000 (2010: 3p absorbing £571,000), payable on 25 January 2012 to shareholders on the Register at the close of business on 6 January 2012. The ex-dividend date will be 4 January 2012.
3. This half yearly report does not constitute financial statutory accounts within the meaning of section 434 of the Companies Act 2006. Statutory accounts for the year ended 31 March 2011 were prepared and filed with the Registrar of Companies and received an unqualified audit report and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.
4.  Earnings per ordinary share is calculated by dividing the net profit for the year attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the year.
	Six months to 30 Sept 2011 unaudited		Six months to 30 Sept 2010 unaudited	Year to 31 March 2011 audited
	£000		£000	£000
Net profit attributable to ordinary shareholders	3,073		3,402	5,884
	Number '000		Number '000	Number '000
Weighted average share capital	19,038		19,070	19,074
Add: diluted effect of share capital options issued	270		189	200
Weighted average share capital for diluted earnings per ordinary share calculation		19,308	19,259	19,274
5.  Net cash flow from operating activities Six months to 30 Sept 2011 unaudited Six months to 30 Sept 2010 unaudited Year to 31 March 2011 audited Operating profit 4,382 4,463 8,070 Depreciation and impairment 460 418 815 Loss on disposal of property, plant and equipment 43 50 18 Increase in inventories (628) (3,222) (5,561) Increase in receivables (3,676) (5,325) (4,872) (Decrease)/increase in payables (252) 4,187 7,156 Own shares non cash amounts 42 46 10 Retirement benefits non cash amounts (253) (602) (913) Share-based payments non cash amounts 32 22 49 Cash generated from operations 150 37 4,772
6.  Copies of this statement will be sent to all shareholders and will also be available on written application to the Company Secretary, James Latham plc, Unit 3 Swallow Park, Finway Road Hemel Hempstead, Herts, HP2 7QU.

 

END

 

 

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