Interim Results for six month
04 August 2008
MORGAN SINDALL plc
('Morgan Sindall' or 'the Group')
Interim results for the six months to 30 June 2008
Morgan Sindall plc, the construction and regeneration group, today announces record interim results.
|
|
2008 |
2007 |
|
|
Revenue |
£1,239m |
£836m |
+48% |
|
Adjusted profit before tax¹ |
£33.1m |
£25.2m |
+31% |
|
Profit before tax |
£28.6m |
£25.2m |
+13% |
|
Cash balance |
£98m |
£62m |
+58% |
|
Adjusted earnings per share ¹ |
60.9p |
41.1p |
+48% |
|
Earnings per share |
50.1p |
41.1p |
+22% |
|
Interim dividend per share |
12.0p |
10.0p |
+20% |
¹ Adjusted for amortisation of intangible assets
Group highlights
-
Record set of interim results
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Continued progress with strategy of developing market leading positions across all chosen sectors
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Significant growth in Construction and Infrastructure Services divisions demonstrates success of acquisition
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Group well placed to deliver long-term sustainable growth
-
Confidence reflected in strength of order book and robust net cash position
Divisional highlights
Fit Out
-
Strong performance in mixed market conditions
-
Operating profit of £11.5m (2007: £12.4m) on revenues of £205m (2007: £225m)
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Record margin of 5.6%, demonstrating benefits of 'Perfect Delivery' quality programme
-
Order book increased both year-on-year and from the start of the year to £220m (2007: £206m)
-
Focus on future growth from increased geographic and sector spread, and larger value contracts
Construction
-
Strong public sector demand, particularly in education, while private sector demand remains robust apart from commercial property
-
Operating profit up 86% to £4.1m (2007: £2.2m), after one-off costs of £1.0m relating to the acquisition, on revenues of £418m (2007: £199m)
-
Margin, after adjusting for one-off costs, up to 1.2% (2007: 1.1%)
-
Performance improvement largely driven by acquisition impact
-
Order book of £828m (2007: £891m)
-
Encouraging outlook with division's enhanced capabilities, project range, and market and geographic coverage following acquisition
Infrastructure Services
-
Buoyant market conditions
-
Operating profit up 90% to £7.6m (2007: £4.0m), after one-off IT costs of £1.4m relating to the acquisition, on revenues of £395m (2007: £221m)
-
Underlying revenue growth of 25%, plus a significant contribution from the acquisition
-
Continued margin improvement to 2.3% (2007: 1.8%), after adjusting for one-off costs
-
Strengthened market position with market leadership in tunnelling, transport, water and utilities
-
Positive outlook backed up by record order book of £1.8bn (2007: £1.5bn)
Affordable Housing
-
Strong performance in social new build and refurbishment sectors offset by impact of mortgage availability in open market housing sector
-
Operating profit of £8.8m (2007: £11.5m) on revenues of £176m (2007: £192m)
-
Margin of 5.0% (2007: 6.0%)
-
Order book maintained at £1.4bn (2007: £1.5bn)
-
Outlook for social housing remains positive; division increasing focus on this area and selling units designated for open market sales to housing associations
Urban Regeneration
-
Solid performance in challenging market conditions
-
Operating profit of £5.6m on revenues of £45m
-
Share of forward development pipeline of £1.1bn, with a further four projects valued at £1.0bn at preferred bidder stage
-
Mixed use development remains a major opportunity in the long-term
John Morgan, Executive Chairman, commented:
'Despite challenging market conditions, we have delivered a record set of interim results. We remain on track to deliver record results for this year in line with our expectations.
'We are pleased with the acquisition we made last year. It brings an increasing balance to the Group and improves our market leading positions in construction, infrastructure and regeneration.
'Our cash position remains strong, while our order book of £4.2bn gives us confidence for the future.'
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ENQUIRIES: |
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Morgan Sindall plc |
Tel: 020 7307 9200 |
|
John Morgan, Executive Chairman |
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Paul Smith, Chief Executive |
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David Mulligan, Finance Director |
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Blythe Weigh Communications |
Tel: 020 7138 3204 |
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Tim Blythe |
Mobile: 07816 924626 |
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Paul Weigh |
Mobile: 07989 129658 |
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Interim Report
We are pleased to announce record results for the six months to 30 June 2008. Profit before tax and amortisation of intangible assets rose by 31% to £33.1m (2007: £25.2m) on revenue that increased by 48% to £1.24bn (2007: £0.84bn). Adjusted earnings per share before amortisation increased by 48% to 60.9p (2007: 41.1p).
Profit before tax for the period (after amortisation of intangible assets) was £28.6m (2007: £25.2m). The Board has declared an interim dividend of 12.0p (2007: 10.0p), an increase of 20%.
Our strategy remains the same, to develop market leading positions within our chosen sectors in the construction and regeneration markets. The Group has made excellent progress in this strategy over the past year. Fit Out has increased its market share in the commercial office fit out sector. Construction and Infrastructure Services have both significantly extended their capabilities and geographic coverage as a result of the businesses acquired from Amec plc in July 2007. Affordable Housing has strengthened its position in the social housing sector, partly compensating for the decline in affordable open market housing. And finally, the Group has added a leading mixed use regeneration capability through its Urban Regeneration division, which was also acquired in July 2007.
The overall growth in profitability of the Group for the first six months of 2008 was driven primarily by contributions from the businesses acquired in July 2007. These contributions are seen in improved performances from Construction and Infrastructure Services compared with the six months to 30 June 2007, as well as in profit from Urban Regeneration. Construction and Infrastructure Services also expanded organically, benefitting from the buoyant market conditions in their respective markets. Conversely, Fit Out and Affordable Housing have both faced more challenging market conditions than those experienced in 2007. Consequently the underlying profitability of the Group achieved in the first half of 2008 was broadly similar to that achieved in the corresponding period in 2007.
Net cash at 30 June 2008 was £98m (2007: £62m) with average cash during the six months to the end of June of £95m compared with £39m for the same period last year.
The performance of each of the operating divisions for the six months to 30 June 2008 is set out below. Divisional operating profits are stated before the amortisation of intangible assets.
Fit Out
Fit Out produced another excellent performance during the first half of 2008, generating an operating profit of £11.5m (2007: £12.4m) on revenue of £205m (2007: £225m). The operating margin of 5.6% (2007: 5.5%) was another record for the division demonstrating the benefits of its 'Perfect Delivery' quality programme. Overall demand in the commercial office fit out market has been reasonably robust, and the division's performance was driven by a strengthening of its market share and its broad sector spread, which helped it offset some softening of demand from the financial services sector.
The division continues to focus on growth from increased geographic spread; expansion into the retail, leisure, entertainment and education sectors; and larger value contracts. Notable projects undertaken or secured during the period include new open plan offices, restaurant and meeting rooms for Guardian Media Group valued at £16m, the £19m fit out of two buildings for London Borough of Newham comprising offices and a new business centre, and a £9m fit out to create new headquarters for the Intercontinental Hotel Group in Buckinghamshire.
The order book has increased both year-on-year and since the start of the year from £179m to £220m (2007: £206m) and revenue for the second half of the year is therefore expected to be ahead of that for the first half. As previously announced, we continue to expect some softening of demand in 2009 albeit current signs are very encouraging with the order book for 2009 ahead of where the 2008 order book was at this time last year.
Construction
The Construction division delivered an operating profit of £4.1m (2007: £2.2m) on revenue of £418m (2007: £199m). This revenue level reflects year-on-year growth of around 5% in the underlying business complemented by growth from last year's acquisition. The operating profit is stated after one-off costs of £1.0m relating to the acquisition. Adjusting the operating profit for these costs gives an operating margin for the period of 1.2% (2007: 1.1%).
As has been well documented, demand in commercial property has weakened. However, demand from the rest of the private sector is reasonably robust while demand from the public sector, which now accounts for approximately 70% of the division's revenue, is strong, particularly in education where we have recently won some major new contracts. The division significantly expanded its capabilities, project range, market coverage and geographic coverage through last year's acquisition and this is reflected in many of the new contracts secured during the period. These include the division's appointment as a construction partner in the delivery of a seven year, £200m building programme for Cambridgeshire County Council and as prime contractor on the £44m Bideford College for Devon County Council a School Pathfinder Project under the Government's Building Schools for the Future ('BSF') programme.
The order book at the end of June was £828m (2007: £891m) with the overall outlook for the construction market remaining encouraging.
Infrastructure Services
Infrastructure Services enjoyed buoyant market conditions during the first half of 2008, driven in particular by investment in the transport and utilities sectors. We expect these favourable conditions to continue for the foreseeable future. The division achieved an operating profit of £7.6m (2007: £4.0m) on revenue of £395m (2007: £221m). This increase in revenue of 79% reflects growth in the underlying business of approximately 25%, with the remainder from last year's acquisition. The operating profit is also stated after one-off IT costs relating to the acquisition of £1.4m. Adjusting the operating profit for these costs gives an improved operating margin of 2.3% (2007: 1.8%).
Infrastructure Services also strengthened its market position through last year's acquisition and it is now a market leader in the water, tunnelling, transport and utilities sectors. This leadership has contributed to its success in securing, as part of the Interlink joint venture, a share of the £445m M74 completion project, Scotland's largest ever road construction scheme, and delivering the BAA infrastructure and pavement works at Heathrow in the first half of 2008.
The order book at the end of June was £1.8bn (2007: £1.5bn) with the outlook for the infrastructure market remaining positive.
Affordable Housing
The refurbishment and new build social housing sectors, which now account for 90% of the division's revenue for the first half of this year, remain healthy underpinned by the Government's Decent Homes programme and funding to the Housing Corporation. The division strengthened its position in these sectors in the first half of the year, in particular securing Decent Homes contracts at Dudley, West Midlands valued at £11m, and in North Warwickshire valued at £12m as well as being appointed development partner by Hounslow Homes for a £53m contract to build 350 new homes for rent and shared ownership.
In recent months, however, the division's open market house sales have been increasingly impacted by the availability of mortgages. Therefore, despite the growth of its revenue from social housing, overall the division delivered a reduced operating profit of £8.8m (2007: £11.5m) on revenue of £176m (2007: £192m) achieving an operating margin of 5.0% (2007: 6.0%).
The order book at the end of June was £1.4bn (2007: £1.5bn). The outlook for social housing in the UK remains positive albeit, as previously announced, we expect the division to continue to be impacted during the remainder of 2008 and in 2009 by the downturn in open market house sales. To mitigate the effects of this downturn the division is successfully increasing its focus on refurbishment and new build social housing, reducing production costs and selling units designated for open market sale to housing associations.
Urban Regeneration
Urban Regeneration performed in line with management's expectations over the first six months of 2008 delivering operating profit, including share of joint ventures, of £5.6m on revenue of £45m. The division, which was acquired last year, gives the Group a leading mixed use property development and urban regeneration business with interests in 30 long-term regeneration projects. Its share of the project pipeline is valued at £1.1bn and it has a share in four further projects currently at preferred bidder stage, valued at an additional £1.0bn.
The division is responding to the recent slowdown of the commercial property market by revisiting existing plans and rephasing developments to ensure it is best placed to take full advantage when the market improves. Although the recent softening of the commercial and residential property sectors means the short-term outlook for the division is subdued, the Group remains of the view that mixed use development is central to the regeneration of urban communities in areas of social and economic deprivation and will be a major opportunity in the long-term.
Financial review and principal risks
Revenue for the six months to 30 June 2008 increased by 48% to £1.24bn (2007: £0.84bn). This increase is due to the impact of the acquisition in July 2007 as well as organic growth at Infrastructure Services and Construction offset by a fall in revenue from Fit Out and Affordable Housing. Overall underlying revenue increased by 4% with the remaining growth contributed by the businesses acquired.
Group profit from operations prior to the amortisation of intangible assets increased by 30% to £30.8m (2007: £23.7m). The operating margin was 2.5% (2007: 2.8%) reflecting the change in the mix of the business with a shift in revenue away from our higher margin divisions. The increase in the profit from operations was driven by the acquisition with underlying profitability being broadly flat year-on-year; increased profit as a result of organic growth at Construction and Infrastructure Services being offset by a decline in profit from Fit Out and Affordable Housing. The cost of Group Activities was broadly similar to that for the same period last year.
Net finance income was £2.3m (2007: £1.5m) reflecting the higher level of average cash over the period of £95m (2007: £39m). Profit before tax and amortisation of intangible assets of £33.1m was 31% ahead of last year's £25.2m. The income tax expense was £7.5m (2007: £7.9m), lower than the same period last year, reflecting the lower headline rate and an increase in the operating profit derived from joint ventures, which is stated after tax. Profit after tax was £21.1m (2007: £17.3m). Shareholders' equity increased to £176.8m (2007: £154.1m).
The average cash for the period was £95m (2007: £39m) and the cash at 30 June 2008 was £98m (2007: £62m). This reflects operating profitability and corresponding strength in operating cash flow over the past twelve months. During the period the Group renewed the £25m, 364-day revolving facility for a further twelve months to June 2009. In addition to its cash resources the Group has in total £75m of committed bank facilities and a £10m overdraft facility.
Related party transactions for the period are disclosed in note 11 to the financial statements following this report.
The directors consider that the key risks which may have a material impact on the Group's performance in the remaining six months of the financial year are unchanged from those detailed in the 2007 annual report and accounts. these include but are not limited to; the ability to attract, develop and retain talented employess, safe operation as a construction business, market related risks, contract related risks and acquisition related risks.
Outlook
As previously announced, for the remainder of 2008 and 2009 we expect the strength in the infrastructure sector and the weakness in the commercial property and open market housing sectors to continue.
Against this market backdrop, the Group remains firmly on course to achieve its targets for 2008 and beyond. Strategically it is better placed than ever, with all of its businesses having further developed their market positions and with the addition of a leading mixed use regeneration business during the past year. Our confidence is reflected in our forward order book, which now stands at £4.2bn (2007: £4.1bn) and in our strong net cash position of £98m (2007: £62m).
Forward-looking statements
This interim report has been prepared solely to assist shareholders to assess the Board's strategies and their potential to succeed. It should not be relied on by any other party for other purposes. Forward-looking statements have been made by the directors in good faith using information available up until the date on which they approved the interim report. Forward-looking statements should be regarded with caution because of the inherent uncertainties in economic trends and business risks.
Morgan Sindall plc
Interim financial statements for the six months to 30 June 2008
Consolidated income statement
for the six months to 30 June 2008 (unaudited)
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Unaudited |
Unaudited |
|
|
Continuing operations |
|
|
|
|
Revenue (note 4) |
1,238.5 |
836.1 |
2,114.6 |
|
Cost of sales |
(1,115.3) |
(744.1) |
(1,892.9) |
|
Gross profit |
123.2 |
92.0 |
221.7 |
|
Other administrative expenses |
(95.9) |
(67.9) |
(168.4) |
|
Amortisation of intangible assets |
(4.5) |
- |
(4.5) |
|
Total administrative expenses |
(100.4) |
(67.9) |
(172.9) |
|
Share of net profit/(loss) of equity accounted joint ventures |
3.5 |
(0.4) |
4.7 |
|
Profit from operations |
26.3 |
23.7 |
53.5 |
|
Finance income |
4.5 |
3.0 |
8.5 |
|
Finance expense |
(2.2) |
(1.5) |
(4.4) |
|
Net finance income |
2.3 |
1.5 |
4.1 |
|
Profit before income tax expense |
28.6 |
25.2 |
57.6 |
|
Income tax expense (note 5) |
(7.5) |
(7.9) |
(18.2) |
|
Profit for the period attributable to equity holders of the parent company |
21.1 |
17.3 |
39.4 |
There are no discontinued activities in either the current or comparative periods.
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Earnings per share |
|
|
|
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From continuing operations |
|
|
|
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Basic (note 7) |
50.1p |
41.1p |
93.8p |
|
Diluted (note 7) |
49.4p |
40.1p |
91.7p |
Morgan Sindall plc
Interim financial statements for the six months to 30 June 2008
Consolidated balance sheet
at 30 June 2008 (unaudited)
|
Unaudited |
Unaudited |
Restated |
|
|
Non current assets |
|
|
|
|
Property, plant and equipment |
26.4 |
18.8 |
23.8 |
|
Goodwill |
183.3 |
72.7 |
183.3 |
|
Other intangible assets |
28.0 |
- |
32.5 |
|
Investments in equity accounted joint ventures |
46.7 |
10.8 |
38.1 |
|
Investments |
0.1 |
0.1 |
0.1 |
|
Deferred tax assets |
5.5 |
3.6 |
5.0 |
|
|
290.0 |
106.0 |
282.8 |
|
Current assets |
|
|
|
|
Inventories |
176.4 |
92.5 |
128.8 |
|
Amounts recoverable on construction contracts |
277.3 |
210.8 |
209.1 |
|
Trade and other receivables |
267.2 |
150.1 |
238.3 |
|
Cash and cash equivalents |
98.3 |
62.4 |
218.9 |
|
|
819.2 |
515.8 |
795.1 |
|
Total assets |
1,109.2 |
621.8 |
1,077.9 |
|
|
|
|
|
|
Current liabilities |
|
|
|
|
Trade and other payables |
(839.8) |
(417.4) |
(814.1) |
|
Amounts received in advance on |
(66.7) |
(36.3) |
(67.4) |
|
Current tax liabilities |
(7.4) |
(6.6) |
(10.6) |
|
Finance lease liabilities |
(3.6) |
(1.5) |
(1.4) |
|
|
(917.5) |
(461.8) |
(893.5) |
|
Net current (liabilities)/assets |
(98.3) |
54.0 |
(98.4) |
|
Non current liabilities |
|
|
|
|
Trade and other payables |
(10.9) |
- |
(12.2) |
|
Retirement benefit obligation |
(2.6) |
(2.8) |
(3.3) |
|
Finance lease liabilities |
(1.4) |
(3.1) |
(3.2) |
|
|
(14.9) |
(5.9) |
(18.7) |
|
Total liabilities |
(932.4) |
(467.7) |
(912.2) |
|
Net assets |
176.8 |
154.1 |
165.7 |
|
|
|
|
|
|
Equity |
|
|
|
|
Share capital |
2.2 |
2.1 |
2.1 |
|
Share premium account |
26.5 |
26.2 |
26.3 |
|
Capital redemption reserve |
0.6 |
0.6 |
0.6 |
|
Own shares |
(7.2) |
(4.7) |
(5.5) |
|
Hedging reserve |
0.1 |
2.9 |
(2.2) |
|
Retained earnings |
154.6 |
127.0 |
144.4 |
|
Total equity |
176.8 |
154.1 |
165.7 |
Morgan Sindall plc
Interim financial statements for the six months to 30 June 2008
Consolidated cash flow statement
for the six months to 30 June 2008 (unaudited)
|
|
Unaudited |
Unaudited |
31 December 2007 |
|
Net cash (outflow)/inflow from operating activities (note 9) |
(103.3) |
(19.2) |
158.1 |
|
Cash flows from investing activities |
|
|
|
|
Interest received |
4.6 |
2.9 |
8.4 |
|
Proceeds on disposal of property, plant and equipment |
0.2 |
0.1 |
0.6 |
|
Purchases of property, plant and equipment |
(4.1) |
(3.6) |
(8.0) |
|
Payments to acquire interests in joint ventures |
(2.8) |
(2.4) |
(5.0) |
|
Payments for the acquisition of a subsidiary |
- |
- |
(25.5) |
|
Net cash acquired on acquisition of a subsidiary |
- |
- |
14.2 |
|
Net cash outflow from investing activities |
(2.1) |
(3.0) |
(15.3) |
|
Cash flows from financing activities |
|
|
|
|
Payments to acquire own shares |
(1.7) |
(1.3) |
(2.1) |
|
Dividends paid |
(11.9) |
(8.4) |
(12.6) |
|
Repayment of obligations under finance leases |
(1.9) |
(1.1) |
(4.7) |
|
Proceeds on issue of share capital |
0.3 |
- |
0.1 |
|
Net cash outflow from financing activities |
(15.2) |
(10.8) |
(19.3) |
|
|
|
|
|
|
Net (decrease)/increase in cash and cash equivalents during the period |
(120.6) |
(33.0) |
123.5 |
|
|
|
|
|
|
Cash and cash equivalents at beginning of period |
218.9 |
95.4 |
95.4 |
|
Cash and cash equivalents at end of period |
98.3 |
62.4 |
218.9 |
Morgan Sindall plc
Interim financial statements for the six months to 30 June 2008
Consolidated statement of recognised income and expense
for the six months to 30 June 2008 (unaudited)
|
|
Unaudited |
Unaudited |
|
|
|
|
|
|
|
Actuarial gains/(losses) arising on defined benefit plan |
0.5 |
(0.3) |
(0.9) |
|
Deferred tax on defined benefit plan liabilities recognised directly in equity |
(0.1) |
- |
0.3 |
|
Movement in cash flow hedges in equity accounted joint ventures |
2.3 |
3.7 |
(1.4) |
|
Net income/(expense) recognised directly in equity |
2.7 |
3.4 |
(2.0) |
|
Profit for the period |
21.1 |
17.3 |
39.4 |
|
Total recognised income and expense attributable to equity holders of the parent company |
23.8 |
20.7 |
37.4 |
Morgan Sindall plc
Interim financial statements for the six months to 30 June 2008
|
|
Unaudited for the six months to 30 June 2008
|
||||||
|
|
Fit Out
£m |
Construction
£m |
Infrastructure Services
£m |
Affordable Housing
£m |
Urban Regeneration
£m |
Group Activities
£m |
Total
£m |
|
Revenue
|
204.5
|
417.7
|
394.8
|
175.8
|
45.1
|
0.6
|
1,238.5
|
|
Operating profit before amortisation
|
11.5
|
4.1
|
7.6
|
8.8
|
2.7
|
(7.4)
|
27.3
|
|
Share of results of associates and joint ventures after tax
|
-
|
-
|
-
|
-
|
2.9
|
0.6
|
3.5
|
|
Profit from operations
before amortisation |
11.5
|
4.1
|
7.6
|
8.8
|
5.6
|
(6.8)
|
30.8
|
|
Amortisation of intangible assets
|
-
|
(1.0)
|
(0.4)
|
-
|
(3.1)
|
-
|
(4.5)
|
|
Profit from operations
|
11.5
|
3.1
|
7.2
|
8.8
|
2.5
|
(6.8)
|
26.3
|
|
Net finance income
|
|
|
|
|
|
|
2.3
|
|
Profit before tax
|
|
|
|
|
|
|
28.6
|
|
|
Unaudited for the six months to 30 June 2007
|
||||||
|
|
Fit Out
£m |
Construction
£m |
Infrastructure Services
£m |
Affordable Housing
£m |
Urban Regeneration
£m |
Group Activities
£m |
Total
£m |
|
Revenue
|
225.0
|
199.0
|
220.5
|
191.6
|
-
|
-
|
836.1
|
|
Operating profit
before amortisation |
12.4
|
2.2
|
4.0
|
11.5
|
-
|
(6.0)
|
24.1
|
|
Share of results of associates and joint ventures after tax
|
-
|
-
|
-
|
-
|
-
|
(0.4)
|
(0.4)
|
|
Profit from operations
before amortisation |
12.4
|
2.2
|
4.0
|
11.5
|
-
|
(6.4)
|
23.7
|
|
Amortisation of intangible assets
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|
Profit from operations
|
12.4
|
2.2
|
4.0
|
11.5
|
-
|
(6.4)
|
23.7
|
|
Net finance income
|
|
|
|
|
|
|
1.5
|
|
Profit before tax
|
|
|
|
|
|
|
25.2
|
|
Year ended 31 December 2007
|
|||||||
|
|
Fit Out
£m |
Construction
£m |
Infrastructure Services
£m |
Affordable Housing
£m |
Urban Regeneration
£m |
Group Activities
£m |
Total
£m |
|
Revenue
|
491.7
|
621.4
|
575.4
|
398.0
|
25.9
|
2.2
|
2,114.6
|
|
Operating profit
before amortisation |
25.9
|
4.9
|
10.6
|
25.5
|
0.9
|
(14.5)
|
53.3
|
|
Share of results of associates and joint ventures after tax
|
-
|
-
|
-
|
-
|
3.3
|
1.4
|
4.7
|
|
Profit from operations
before amortisation |
25.9
|
4.9
|
10.6
|
25.5
|
4.2
|
(13.1)
|
58.0
|
|
Amortisation of intangible assets
|
-
|
(1.0)
|
(0.3)
|
-
|
(3.2)
|
-
|
(4.5)
|
|
Profit from operations
|
25.9
|
3.9
|
10.3
|
25.5
|
1.0
|
(13.1)
|
53.5
|
|
Net finance income
|
|
|
|
|
|
|
4.1
|
|
Profit before tax
|
|
|
|
|
|
|
57.6
|
|
|
Unaudited
six months to 30 June |
Year ended
|
|
|
|
2008
£m |
2007
£m |
31 December 2007
£m |
|
Current tax expense
|
|
|
|
|
UK corporation tax
|
7.6
|
7.8
|
19.7
|
|
Adjustment in respect of prior years
|
0.2
|
-
|
0.3
|
|
|
7.8
|
7.8
|
20.0
|
|
Deferred tax expense
|
|
|
|
|
Current year
|
(0.3)
|
0.1
|
(0.1)
|
|
Adjustment in respect of prior years
|
-
|
-
|
(1.7)
|
|
|
(0.3)
|
0.1
|
(1.8)
|
|
|
|
|
|
|
Total income tax expense
|
7.5
|
7.9
|
18.2
|
|
|
Unaudited
Six months to 30 June |
Year ended
|
|
|
|
2008
£m |
2007
£m |
31 December 2007
£m |
|
|
|
|
|
|
Final dividend for the year ended 31 December 2007
of 28.0p (2006: 20.0p) per share
|
11.9
|
8.4
|
8.4
|
|
|
|
|
|
|
Proposed interim dividend for the period to 30 June 2008
of 12.0p (2007: 10.0p) per share |
5.2
|
4.2
|
4.2
|
|
|
Unaudited
six months to 30 June |
Year ended
|
|
|
Earnings
|
2008
£m |
2007
£m |
31 December 2007
£m |
|
Earnings before taxation
|
28.6
|
25.2
|
57.6
|
|
Deduct: taxation expense per income statement
|
(7.5)
|
(7.9)
|
(18.2)
|
|
Earnings for the purpose of basic and dilutive earnings per share being net profit attributable to equity holders of the parent company
|
21.1
|
17.3
|
39.4
|
|
Add back: amortisation expense
|
4.5
|
-
|
4.5
|
|
Earnings for the purposes of basic and dilutive earnings per share adjusted for amortisation expense
|
25.6
|
17.3
|
43.9
|
|
|
Unaudited
six months to 30 June |
Year ended
|
|
|
Number of shares
|
2008
No. ’000s |
2007
No. ’000s |
31 December 2007
No. ’000s |
|
Weighted average number of ordinary shares for the purposes of basic earnings per share
|
42,095
|
42,003
|
41,989
|
|
Effect of dilutive potential ordinary shares:
|
|
|
|
|
Share options
|
355
|
867
|
720
|
|
Conditional shares not vested
|
196
|
179
|
239
|
|
Weighted average number of ordinary shares for the purposes of diluted earnings per share
|
42,646
|
43,049
|
42,948
|
|
|
Unaudited
six months to 30 June |
Year ended
|
|
|
|
2008
pence |
2007
pence |
31 December 2007
pence |
|
Basic and diluted earnings per share
|
|
|
|
|
Basic earnings per share
|
50.1p
|
41.1p
|
93.8p
|
|
Diluted earnings per share
|
49.4p
|
40.1p
|
91.7p
|
|
Basic and diluted earnings per share adjusted for amortisation
|
|
|
|
|
Basic earnings per share
|
60.9p
|
41.1p
|
104.5p
|
|
Diluted earnings per share
|
60.1p
|
40.1p
|
102.2p
|
|
|
Unaudited
six months to 30 June |
Year ended
|
|
|
|
2008
£m |
2007
£m |
31 December 2007
£m |
|
|
|
|
|
|
Balance at beginning of the period
|
165.7
|
141.9
|
141.9
|
|
Total recognised income and expense
|
23.8
|
20.7
|
37.4
|
|
Final dividend for 2007
|
(11.9)
|
(8.4)
|
(8.4)
|
|
Interim dividend
|
-
|
-
|
(4.2)
|
|
Share-based payments
|
1.1
|
1.2
|
1.7
|
|
Issue of shares at a premium
|
0.3
|
-
|
0.1
|
|
Exercise of share options
|
0.4
|
-
|
-
|
|
Deferred tax on share based payments
|
0.3
|
-
|
(0.7)
|
|
Own shares acquired
|
(1.7)
|
(1.3)
|
(2.1)
|
|
Share award under long term incentive plan
|
(1.2)
|
-
|
-
|
|
Balance at end of the period
|
176.8
|
154.1
|
165.7
|
|
|
Unaudited
six months to 30 June |
Year ended
|
|
|
|
2008
£m |
2007
£m |
31 December 2007
£m |
|
Cash flows from operating activities
|
|
|
|
|
Profit from operations for the period
|
26.3
|
23.7
|
53.5
|
|
Adjusted for:
|
|
|
|
|
Amortisation of intangible assets
|
4.5
|
-
|
4.5
|
|
Share of results of joint ventures
|
(3.5)
|
0.4
|
(4.7)
|
|
Depreciation of property, plant and equipment
|
3.5
|
2.8
|
6.3
|
|
Expense in respect of share options
|
0.3
|
1.2
|
1.7
|
|
Defined benefit pension payment
|
(0.3)
|
(0.1)
|
(0.2)
|
|
Defined benefit pension charge
|
0.1
|
0.1
|
0.1
|
|
(Gain)/loss on disposal of property, plant and equipment
|
(0.1)
|
0.4
|
1.2
|
|
Operating cash flows before movements in working capital
|
30.8
|
28.5
|
62.4
|
|
Increase in inventories
|
(47.6)
|
(5.7)
|
(10.4)
|
|
Increase in receivables
|
(97.2)
|
(79.8)
|
(33.3)
|
|
Increase in payables
|
23.7
|
46.8
|
159.2
|
|
Cash (absorbed by)/generated by operations
|
(90.3)
|
(10.2)
|
177.9
|
|
Income taxes paid
|
(11.0)
|
(7.6)
|
(15.8)
|
|
Interest paid
|
(2.0)
|
(1.4)
|
(4.0)
|
|
Net cash (outflow)/inflow from operating activities
|
(103.3)
|
(19.2)
|
158.1
|
|
|
|
|
£m
|
|
Purchase consideration:
|
|
|
|
|
Cash paid
|
|
|
23.7
|
|
Costs directly attributable to the acquisition
|
|
|
1.8
|
|
Total purchase consideration
|
|
|
25.5
|
|
Net liabilities acquired
|
|
|
(85.1)
|
|
Goodwill
|
|
|
110.6
|
|
|
Acquiree's carrying amount
£m |
Provisional fair value adjustments made 31 December 2007
£m
|
Final fair value adjustments made 30 June 2008
£m |
Fair value
30 June 2008 £m |
|
Cash and cash equivalents
|
14.2
|
-
|
-
|
14.2
|
|
Intangible fixed assets:
|
|
|
|
|
|
Secured customer contracts
|
-
|
3.1
|
1.1
|
4.2
|
|
Other contracts and related relationships
|
-
|
30.7
|
(3.8)
|
26.9
|
|
Software
|
-
|
0.9
|
-
|
0.9
|
|
Non-compete agreement
|
-
|
5.0
|
-
|
5.0
|
|
Tangible fixed assets
|
2.0
|
0.2
|
(0.2)
|
2.0
|
|
Investments in joint ventures and associates
|
28.7
|
(4.2)
|
-
|
24.5
|
|
Working capital
|
(68.2)
|
(37.0)
|
(57.6)
|
(162.8)
|
|
Net liabilities acquired
|
(23.3)
|
(1.3)
|
(60.5)
|
(85.1)
|
|
|
|
|
|
|
|
Purchase consideration settled in cash
|
|
|
|
23.7
|
|
Directly attributable acquisition costs
|
|
|
|
1.8
|
|
Cash and cash equivalents acquired
|
|
|
|
(14.2)
|
|
Cash outflow on acquisition
|
|
|
|
11.3
|
|
Six months to 30 June 2008
|
Provision of goods and services
£m |
Amounts owed by/(owing to) related parties
£m |
|
Community Solutions for Primary Care (Holdings) Limited
|
26.3
|
5.4
|
|
Lingley Mere Business Park Development Company Limited
|
13.6
|
(4.5)
|
|
Ician Developments Limited
|
13.2
|
-
|
|
PFF Dorset Limited
|
12.3
|
1.4
|
|
Six months to 30 June 2007
|
Provision of goods and services
£m |
Amounts owed by/(owing to) related parties
£m |
|
Community Solutions for Primary Care (Holdings) Limited
|
5.0
|
0.5
|
|
Morgan Sindall Investments (3PD) Limited
|
1.7
|
0.1
|
|
Year ended 31 December 2007
|
Provision of goods and services
£m |
Amounts owed by/(owing to) related parties
£m |
|
Community Solutions for Primary Care (Holdings) Limited
|
7.7
|
0.8
|
|
The Compendium Group Limited
|
2.2
|
-
|
|
Eurocentral Partnership Limited
|
11.3
|
-
|
|
Lingley Mere Business Park Development Company Limited
|
2.6
|
(6.5)
|
|
Bromley Park Limited
|
8.2
|
(5.9)
|
|
PFF Dorset Limited
|
9.5
|
2.4
|
This information is provided by RNS
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