Interim Results

RNS Number : 6060S

Leeds Group PLC

21 May 2009

 



Issued on behalf of Leeds Group plc                                                                       Embargoed: 7.00am

Date: 21 May 2009

LEEDS GROUP plc

Interim Results for the six months ended 31st March 2009

STATEMENT BY THE GROUP CHAIRMAN, EWEN WIGLEY

In the six month period ending on 31st March 2009, I can report that Leeds Group made a profit after tax of £134,000 (2008: £315,000). I am pleased to note that Revenue in the period increased to £13,230,000 (2008: £11,337,000). This growth arose from increased sales in our European markets, new sales from our recently established Chinese subsidiary and the effect of the weaker pound when translating overseas results. However, the challenging economic climate in which the Group operates led to reduced margins and resulted in the decrease in profitability.

The Net Assets of the Group increased by £2,081,000 during the six month period. The increase in valuation of overseas assets arising from the depreciation in sterling accounted for £1,440,000 of the Net Asset growth whilst the increase in value of the Group's holding in Dawson International Plc contributed a further £564,000. The Net Asset Value per share (excluding shares held in treasury) grew in the period by 18.9% to 47.9 pence as at 31st March 2009 (30th September 2008: 40.3 pence).

In the light of the difficult economic environment, Hemmers-Itex, the Group's sole operating business, has continued to maximise efficiency and reduce costs in order to remain competitive. The Chinese subsidiary, whilst set up as a strategic move, is already contributing to the Group's profitability and the Board considers that it should have a promising future.

At 31st March 2009 Leeds Group had investments in Dawson International Plc and European Equity Tranche Income Limited ('EETI'), both of whose shares are traded on AIM. The Board was pleased to note the improved financial results for the 2008 financial year, issued by Dawson in March 2009, and the increase in the share price. EETI announced a capital restructuring in January 2009 in order to reduce its debt and after careful consideration Leeds Group made a further investment of £200,000 as part of that process.

The Company seeks to continue to use the authority granted to it to buy back shares into Treasury, although the stock market has not presented many opportunities. During the six month period, the company purchased 400,000 shares into Treasury, and cancelled a further 450,000 shares in order to comply with Companies Act 2006 requirements.

Whilst the Board continues to look for further investments, it also remains focused on ensuring Hemmers Itex continues to perform in difficult times. In line with the Board's previous decisions, it does not propose an interim dividend.

The Board remains grateful for the hard work put in by all staff within the Group.

Given the general expectation that the European economies are unlikely to improve in the short term, the outlook for the remainder of the financial year is likely to remain challenging.

Ewen Wigley

Chairman  

Enquiries:
Leeds Group plc	Citigate Dewe Rogerson	Seymour Pierce Limited
Ewen Wigley, Chairman	Fiona Tooley	Sarah Jacobs
Tel: [phone]	Tel: [phone] or 07785 703523	Tel: [phone]
Malcolm Wilson, Company Secretary
Tel: [phone] or 07801 224618

Consolidated Income Statement
for the 6 months ended 31 March 2009

	6 months to 31 March  2009 £000	6 months to 31 March 2008 £000	12 months to 30 September 2008 £000
Revenue	13,230	11,337	21,974
Cost of sales	(10,293)	(8,644)	(16,819)
Gross profit	2,937	2,693	5,155
Distribution costs	(1,003)	(775)	(1,615)
Administrative expenses	(1,676)	(1,567)	(3,015)
Profit from operations	258	351	525
Finance expense	(149)	(117)	(219)
Finance income	30	127	216
Profit before tax	139	361	522
Tax expense	(5)	(46)	(73)
Profit for the year, attributable to  the equity holders of the parent	134	315	449

The results shown in the income statement derive wholly from continuing operations.

Earnings per share for profit attributable

to the equity holders of the company

	6 months to 31 March 2009	6 months to 31 March 2008	12 months to 30 September 2008
Basic and diluted (pence)	0.5	1.0	1.4

Consolidated Statement of Recognised Income and Expense
for the 6 months ended 31 March 2009

	6 months to 31 March  2009 £000	6 months to 31 March 2008 £000	12 months to 30 September 2008 £000
Translation differences on foreign operations	1,440	927	898
Unrealised gains taken to available-for-sale reserve	564	-	74
Net income recognised directly in equity	2,004	927	972
Profit for the period	134	315	449
Total recognised income and expense for the period	2,138	1,242	1,421

Consolidated Balance Sheet
at 31 March 2009

	As at 31 March 2009 £000	As at 31 March 2008 £000	As at 30 September 2008 £000
Assets
Non-current assets
Property, plant and equipment	2,521	1,755	2,053
Intangible assets	1,038	889	883
Available-for-sale investments	1,757	276	1,100
Total non-current assets	5,316	2,920	4,036
Current assets
Inventories	6,193	5,386	6,573
Trade and other receivables	7,294	5,554	6,662
Corporation tax recoverable	44	58	125
Derivative financial assets	-	-	28
Cash available on demand	2,222	3,800	2,486
Total current assets	15,753	14,798	15,874
Total assets	21,069	17,718	19,910
Liabilities
Non-current liabilities
Loans and borrowings	(2,327)	(1,990)	(1,977)
Total non-current liabilities	(2,327)	(1,990)	(1,977)
Current liabilities
Trade and other payables	(1,384)	(1,214)	(1,676)
Loans and borrowings	(3,257)	(2,339)	(4,244)
Derivative financial liabilities	(7)	(115)	-
Total current liabilities	(4,648)	(3,668)	(5,920)
Total liabilities	(6,975)	(5,658)	(7,897)
TOTAL NET ASSETS	14,094	12,060	12,013

Capital and reserves attributable to equity holders of the company
Share capital	3,918	4,188	3,972
Capital redemption reserve	474	204	420
Treasury share reserve	(624)	(840)	(667)
Available-for-sale reserve	638	-	74
Foreign exchange reserve	2,505	1,094	1,065
Retained earnings	7,183	7,414	7,149
TOTAL EQUITY	14,094	12,060	12,013

Consolidated Cash Flow Statement
for the 6 months ended 31 March 2009

	6 months to 31 March  2009 £000	6 months to 31 March 2008 £000	12 months to 30 September 2008 £000
Cash flows from operating activities
Profit for the period	134	315	449
Adjustments for:
Depreciation	108	79	161
Impairment of available-for-sale investment	107	-	231
Foreign exchange (gain)/loss	36	85	(54)
Translation gain/(loss) on cash and cash equivalents	13	98	67
Finance expense	149	117	219
Finance income	(30)	(127)	(216)
Loss/(gain) on sale of property, plant and equipment	4	-	(2)
Income tax expense	5	46	73
Cash flows from operating activities before changes in working capital and provisions	526	613	928
Decrease/(increase) in inventories	1,437	519	(684)
Decrease/(increase) in trade and other receivables	505	(597)	(1,701)
(Decrease)/increase in trade and other payables	(642)	(339)	124
Cash generated from operating activities	1,826	196	(1,333)
Income taxes recovered/(paid)	92	(133)	(222)
Net cash flows from operating activities	1,918	63	(1,555)
Investing activities
Purchase of property, plant and equipment	(207)	(1,482)	(1,812)
Sale of property, plant and equipment	-	-	5
Purchase of available-for-sale investments	(200)	(276)	(1,257)
Dividend from available-for-sale investment	-	12	21
Bank interest received	30	115	195
Net cash used in investing activities	(377)	(1,631)	(2,848)
Financing activities
Purchase of treasury shares	(57)	(74)	(300)
Proceeds from bank borrowings	-	716	4,201
Repayment of bank borrowings	(1,524)	-	(1,606)
Bank interest paid	(149)	(117)	(219)
Net cash used in financing activities	(1,730)	525	2,076
Net (decrease)/increase in cash and cash equivalents	(189)	(1,043)	(2,327)
Cash and cash equivalents at beginning of the period	2,367	4,694	4,694
Cash and cash equivalents at end of the period	2,178	3,651	2,367

Interim results

for the 6 months ended 31 March 2009

Notes to the accounts

1.    The financial information in this report does not constitute statutory accounts within the meaning of section 240 of 
       the Companies Act 1985. The interim accounts for the six months ended 31 March 2009 and 31 March 2008 are
       unaudited. The comparative figures for the financial year ended 30 September 2008 are not the group's statutory 
       accounts, but have been extracted from those accounts, which have been filed with the Registrar of Companies 
       and on which the group's auditor gave an unqualified report that did not include reference to any matters to which
       the auditor drew attention by way of emphasis without qualifying the report and did not contain statements under 
       section 237 (2) or (3) of the Companies Act 1985.

2.    Ordinary shares of 12 pence each used in the calculation of earnings per share:

	6 months to 31 March 2009	6 months to 31 March 2008	12 months to 30 September 2008
	29,669,946	31,377,138	31,050,281

3.    Statement of changes to shareholders' equity

	6 months to 31 March 2009 £000	6 months to 31 March 2008 £000	12 months to 30 September 2008 £000
Opening shareholders' equity	12,013	10,892	10,892
Translation differences on foreign operations	1,440	927	898
Unrealised gains taken to available-for-sale reserve	564	-	74
Profit for the period	134	315	449
Purchase of own shares for treasury	(57)	(74)	(300)
Closing shareholders' equity	14,094	12,060	12,013

4.    Reconciliation of movements in net debt

	6 months to 31 March 2009 £000	6 months to 31 March 2008 £000	12 months to 30 September 2008 £000
(Decrease)/increase in cash & cash equivalents	(189)	(1,043)	(2,327)
Proceeds from bank borrowings	-	(716)	(4,201)
Repayment of bank borrowings	1,524	-	1,606
Foreign currency translation differences on loans	(962)	(430)	(473)
Movement in net debt	373	(2,189)	(5,395)
Net (debt)/cash at beginning of period	(3,735)	1,660	1,660
Net (debt)/cash at beginning of period	(3,362)	(529)	(3,735)

 

END

 

 

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