Final Results

NWF Group PLC 15 August 2002 FOR RELEASE 7.00 AM 15 AUGUST 2002 NWF Group plc PRELIMINARY RESULTS FOR THE YEAR ENDED 31 MAY 2002 Highlights for 2002: • a record pre-tax profit, up 24% at £4.2m (£3.4m) • profit growth over last year in all four businesses • total Group sales up 5% to £155m • basic earnings per share up to 36.7p (29.7p as restated) • dividend per share increased again to 13.0p (11.1p) • Dukeries Garden Centre acquired For further information contact: Graham Scott (Chief Executive) 01829 260260 Alan Fulker (Finance Director) NWF Group plc PRELIMINARY Results for the YEAR ended 31 MAY 2002 CHAIRMAN'S STATEMENT I am delighted to be able to report significantly increased profits for the Group at £4,206,000 pre-tax compared to last year's record of £3,404,000. All four businesses improved their performance with three of the four reporting best-ever years. This performance again allows us to propose an increased final dividend to shareholders. Trading results Our Agriculture business achieved another record performance in difficult trading conditions. Distribution also improved its profit on last year as the benefits of the new warehouse began to work through. Fuels delivered its own best-ever year with last year's acquisition in South Wales providing a full year contribution. Although the weather has not been kind to gardeners in recent times, our Retail business was still able to report a record year. Cash flows and funding The business generated £6.8m cash (£4.4m) from operating activities and the Group's net cash flow was improved to £1.6m (£1.6m outflow) after the various applications of funds including investment in our future by means of £1.3m (£4.4m) net capital expenditure and £2.3m (£1.1m) acquisition payments. Interest cover for the year was a comfortable 7.5 times (5.9 times). Acquisitions and investments We have invested in our Retail activities by the acquisition late in the year of the Dukeries Garden Centre business in Welbeck, Nottinghamshire. This had no material effect on the year's trading results. We have confined capital expenditure this year to a number of essential items which underpin our business growth, for example curtainsider trailers for Distribution and new tankers for Fuels. Dividend At the Annual General Meeting, we shall continue our progressive dividend policy by proposing a final dividend of 9.4p (7.9p) per share to bring the total dividend for the year to 13.0p (11.1p) per share, an increase of 17%. This total dividend would be covered 2.8 times (2.6 times) by post-tax profits. Subject to shareholder approval, the final dividend will be paid on 1 November to shareholders on the register at 23 August 2002 (ex-dividend 21 August 2002). Outlook for the current year Your Board remains positive about the prospects in each of the businesses. We have formed a promising alliance in Agriculture, we believe we have scope for improved margins in Distribution, Fuels continues to seek to expand its territorial penetration and Retail is aiming for better sales and margins. Customers, employees and shareholders I am always pleased to see expansion in the circle of customers served by NWF companies and I thank them all for their business. It is my conviction that we have continued to grow by serving our customers well. Our employee numbers have risen again, particularly in garden centres, to an average of 691 (587) and I thank them all for their efforts in delivering another good year for the Group. In the year, we have said goodbye with our thanks and good wishes for a happy retirement to Michael Cookson who served for a number of years as Company Secretary and a Director. We also welcomed John Acornley as a Non-Executive Director on 1 November 2001. Linda Walker, formerly Finance Director of Boughey Distribution Ltd, has become Company Secretary. We believe that there is now renewed interest in more traditional stocks such as NWF which offer a track record of dividend growth and I am delighted to welcome new shareholders into the fold. As an AIM company, investments in NWF shares attract certain tax reliefs with respect to Capital Gains Tax and Inheritance Tax. Investors should, of course, obtain their own definitive tax advice. J Roy Willis, Chairman 15 August 2002 NWF Group plc PRELIMINARY RESULTS FOR THE YEAR ENDED 31 MAY 2002 CONSOLIDATED PROFIT AND LOSS ACCOUNT 2002 2001 (restated) £'000 £'000 TURNOVER 154,741 147,187 Cost of sales (140,513) (134,459) GROSS PROFIT 14,228 12,728 Trading costs (9,374) (8,631) OPERATING PROFIT 4,854 4,097 Interest payable (648) (693) PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION 4,206 3,404 Taxation (1,300) (1,055) PROFIT AFTER TAXATION 2,906 2,349 Equity dividends (1,035) (877) RETAINED PROFIT TRANSFERRED TO RESERVES 1,871 1,472 ==== ==== Earnings per share Basic and diluted 36.7p 29.7p All of the Group's turnover is derived from continuing operations. STATEMENT OF GROUP TOTAL RECOGNISED GAINS AND LOSSES 2002 2001 (restated) £'000 £'000 PROFIT FOR THE FINANCIAL YEAR AFTER TAXATION 2,906 2,349 PRIOR YEAR ADJUSTMENT (178) - TOTAL GAINS RECOGNISED SINCE LAST ANNUAL REPORT 2,728 2,349 ==== ==== NWF Group plc PRELIMINARY RESULTS FOR THE YEAR ENDED 31 MAY 2002 CONSOLIDATED BALANCE SHEET 2002 2001 (restated) £'000 £'000 £'000 £'000 FIXED ASSETS Intangible assets 2,634 705 Tangible assets 17,158 17,324 19,792 18,029 CURRENT ASSETS Stocks 5,256 4,943 Debtors 18,887 19,281 Cash and bank balances 218 21 24,361 24,245 CREDITORS - Amounts falling due within one year (22,399) (24,050) NET CURRENT ASSETS 1,962 195 TOTAL ASSETS LESS CURRENT LIABILITIES 21,754 18,224 CREDITORS - Amounts falling due after more than one year (5,741) (4,180) PROVISIONS FOR LIABILITIES AND CHARGES Pension provision (113) (133) Deferred Taxation (802) (803) NET ASSETS 15,098 13,108 === === CAPITAL AND RESERVES EQUITY SHARE CAPITAL 1,990 1,975 RESERVES Share premium 535 520 Revaluation reserve 1,624 1,651 Other reserves 302 213 Profit and loss account 10,647 8,749 TOTAL EQUITY SHAREHOLDERS' FUNDS 15,098 13,108 === === NWF Group plc PRELIMINARY RESULTS FOR THE YEAR ENDED 31 MAY 2002 CONSOLIDATED CASH FLOW STATEMENT 2002 2001 £'000 £'000 £'000 £'000 NET CASH INFLOW FROM 6,753 4,368 OPERATING ACTIVITIES RETURNS ON INVESTMENTS AND SERVICING OF FINANCE Interest paid (695) (670) TAXATION Corporation tax paid (1,082) (1,068) CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT Purchase of tangible fixed assets (1,348) (4,759) Sale of tangible fixed assets 39 361 NET CASH OUTFLOW FROM CAPITAL EXPENDITURE (1,309) (4,398) ACQUISITIONS AND DISPOSALS Acquisition of businesses (1,657) (421) Cash acquired with businesses 178 - Deferred payment for businesses acquired in prior year (800) (650) NET CASH OUTFLOW FOR ACQUISITIONS (2,279) (1,071) EQUITY DIVIDENDS PAID (911) (814) NET CASH INFLOW/(OUTFLOW) BEFORE FINANCING 477 (3,653) FINANCING Medium term loan received 1,600 2,500 Medium term loan repayment (454) (466) Shares issued for consideration including premium 19 - INCREASE/(DECREASE) IN CASH IN THE YEAR 1,642 (1,619) === === NWF Group plc PRELIMINARY RESULTS FOR THE YEAR ENDED 31 MAY 2002 NOTES TAXATION 2002 2001 (restated) £'000 £'000 UK Corporation tax at 30% (2001 - 30%) 1,345 1,053 Deferred tax 8 54 1,353 1,107 Prior year - current tax (38) (24) - deferred tax (15) (28) 1,300 1,055 === === SEGMENTAL INFORMATION Business Turnover Operating profit Net operating assets 2002 2001 2002 2001 2002 2001 £'000 £'000 £'000 £'000 £'000 £'000 Agriculture 44,134 38,816 1,408 1,270 7,998 8,735 Distribution 12,565 8,990 1,318 1,125 9,257 9,670 Fuels 84,260 86,158 1,408 1,106 3,962 3,314 Retail 13,782 13,223 720 596 5,233 4,508 154,741 147,187 4,854 4,097 26,450 26,227 ==== ==== ==== ==== ==== ==== EARNINGS PER SHARE The calculation of basic earnings per share is based on profit after tax for the financial year divided by 7,918,652 ordinary shares being the weighted average number of ordinary shares in issue (2001 - 7,900,941). Earnings per ordinary share is adjusted to a fully diluted basis by adding to the weighted number of shares in issue, in the calculation, the weighted average number of 9,000 (2001 - 16,000) diluted ordinary shares in respect of outstanding share options. RECONCILIATION OF OPERATING PROFIT TO NET CASH INFLOW FROM OPERATING ACTIVITIES 2002 2001 £'000 £'000 £'000 £'000 Operating profit 4,854 4,097 Goodwill amortisation 53 24 Depreciation charge 1,879 1,808 Profit on sale of tangible fixed assets (34) (115) Decrease/(increase) in stocks 238 (168) Decrease/(increase) in debtors 477 (4,074) (Decrease)/increase in creditors (694) 2,814 Decrease in pension provision (20) (18) 1 (1,446) Net cash inflow from operating activities 6,753 4,368 ==== ==== ANALYSIS OF NET DEBT Other At 31 May non-cash At 31 May 2001 Cash flow changes 2002 £'000 £'000 £'000 £'000 Cash and bank balances 21 197 - 218 Bank overdraft (6,413) 1,445 - (4,968) (6,392) 1,642 - (4,750) Debt due within one year (454) 454 (739) (739) Debt due after one year (4,080) (1,600) 739 (4,941) Total (10,926) 496 - (10,430) ==== ==== === ==== PRIOR YEAR ADJUSTMENT The prior year adjustment relates to the implementation of FRS19. The adoption of FRS19 has resulted in an increase of the tax charge by £1,000 (2001: decrease £35,000) and a decrease in profit of £1,000 (2001: increase £35,000). Analysis of prior year adjustment Group £'000 Adjustment to opening reserves at 1 June 2000 (213) Adjustment to profit and loss for the year ended 31 May 2001 35 (178) === Annual Report to be published 2 September 2002 Annual General Meeting 26 September 2002 Dividend: - to be paid 1 November 2002 - ex-dividend 21 August 2002 - record date for shareholders 23 August 2002 Annual Report: This preliminary announcement does not form the Group's statutory accounts. The figures shown in this release have been extracted from the Group's full financial statements which, for the year ended 31 May 2001, have been delivered, and for the year ended 31 May 2002 will be delivered to the Registrar of Companies. Both carry an unqualified audit report. The financial statements for the year ended 31 May 2002 have been prepared in accordance with applicable accounting standards, using the same accounting policies as set out in the Annual Report for the year ended 31 May 2001 with the following exceptions. For the financial year beginning on 1 June 2001, the Group has adopted three new Financial Reporting Standards - FRS17 (Retirement Benefits), FRS18 (Accounting Policies) and FRS19 (Deferred Tax). The comparative figures for the year to 31 May 2001 have been restated to reflect the impact of FRS19 (see Prior Year Adjustment Note). There have been no changes to the financial information in the Preliminary Announcement as a consequence of adopting FRS17 and 18. After 2 September, copies of the Annual Report can be obtained from the Company's registered office at Wardle, Nantwich, Cheshire, CW5 6BP or viewed on the Company's Website: http://www.nwf.co.uk This information is provided by RNS The company news service from the London Stock Exchange

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