Final Results

RNS Number : 7207C

Robinson PLC

20 March 2014

 



Robinson plc

PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2013

Robinson plc ("Robinson"; stock code: RBN), the custom manufacturer of plastic and paperboard packaging based in Chesterfield, announces its results for the year ended 31 December 2013.

Highlights:

·   The reported profit before tax was £3.7m (2012: £2.8m) after an exceptional gain of £1.1m was made on the sale of Portland.

·   Revenue increased by 10% to £23.3 m (2012: £21.2m) and underlying volumes increased by 8%.

·   Gross margins reduced as a result of higher plastic resin costs

·   Sales overheads rose by £0.2m following investment in additional personnel

·   Rental incomes reduced by £0.2m after the sale of Portland

·   The notional financial income in respect of the pension fund reduced by £0.2m

·   Cash less loan balances increased by £3.9m

·   Net assets increased by £2.5m to £25.1m

·   The Board is recommending an increased final dividend for the year of 2.5p per share (2012: 2.25p), raising the total dividend declared in respect of 2013 by 12.5% to 4.5p

Commenting on the results, Chairman, Richard Clothier said:

"Despite subdued market conditions, I am very pleased to report the new business growth that is reflected in increased revenues. The sale of the Portland factory in Chesterfield to Sonoco results in reduced rental income but leaves the Group with cash to fund the growth by acquisition which we have announced since the year end. Growth in revenues is continuing in 2014 to date. In February the agreement to acquire the Polish packaging manufacturer, Madrox, near Warsaw, was announced. If completed as expected, this acquisition will add significantly to Robinson's revenues and, once the integration costs are covered, Madrox is expected to substantially improve the Group's earnings and cash flow. The capabilities and new customers that the company brings to Robinson will add to the prospects for further sales growth beyond 2014."

About Robinson

Headquartered in Chesterfield, with manufacturing facilities in Kirkby-in-Ashfield, Stanton Hill (Nottinghamshire) and Lodz (Poland), Robinson currently employs around 235 people. It was formerly a family business, with its origins dating back some 175 years. Today the Group's main activity is the manufacture and sale of injection moulded plastic packaging. Robinson operates primarily within the food, drink, confectionery, cosmetic and toiletry sectors, providing niche or custom manufacture to major players in the fast moving consumer goods market, such as Proctor & Gamble, Nestle, Kraft, United Biscuits, Two Sisters, Masterfoods, Bakkavor, Avon and Dr Oetker. The Group also has a substantial property portfolio with development potential.

For further information, please contact:

Guy Robinson, Finance Director, Robinson plc	01246 389283
	www.robinsonpackaging.com
Katy Mitchell, WH Ireland	0161 832 2174

CHAIRMAN'S STATEMENT

Market conditions remain rather subdued, particularly for many of our customers' branded products, so I am very pleased to report the new business growth that is reflected in increased revenues. The sale of the Portland factory in Chesterfield to Sonoco results in reduced rental income but leaves the Group with cash to fund the growth by acquisition which we have announced since the year end.

Revenue and profits

Group revenues increased by 10% to £23.3m in the year. This was affected by plastic resin prices being higher by an average of 6% which were largely passed on to our customers resulting in higher reported revenues. We estimate that volumes were 8% higher in the year, which was mainly attributable to the full year impact of new business gained in 2012 that did not come on stream until the latter part of that year. Rising input prices, compared with reducing prices in 2012, contributed to the gross profit reverting from 24% back to 22% where it was in 2011. Operating costs rose as we invested in additional sales personnel (£0.2m) whilst rental income was reduced (£0.2m) following the sale of Portland so profit before exceptional items fell slightly. The £1.1m exceptional gain arising from the sale of Portland increased the profit before tax to £3.7m (2012: £2.8m).

Surplus properties

Sonoco exercised its option to buy the Portland property in Chesterfield for £4.2m during the year. As a result, future rental incomes will reduce by £0.4m per annum, effective from August 2013.

Pension fund

The Group's pension fund surplus reduced by 2% to £7.5m during the year. The total assets in the fund reduced by 1% to £56.1m with 87% of investments in gilts, bonds or cash. In addition, £2.4m sits in an escrow account between the Company and the fund. The Company and trustees anticipate that market conditions may enable a buy out of the liabilities of the fund to be achieved without cost to the Company within the next 5 years. Consequently, the surplus attributable to the Group has been restricted.

Cash, finances and dividend

Net cash amounted to £5.4m at the end of the year. The net cash inflow for the year was £3.6m comprising increased proceeds from disposals of £4.0m plus £1.6m from operations, less capital expenditure of £1.4m and dividends paid of £0.7m. Shareholders' funds increased by 11%. The Board proposes a final dividend of 2.5p per share to be paid on 2 June 2014 to shareholders on the register at the close of business on 16 May 2014. This brings the total dividend declared in respect of 2013 to 4.5p per share - an increase of 12.5% over the previous year.

Outlook

Having worked hard in recent years on improving the profitability of the business, more emphasis is being given to improving the top line.  Growth in revenues is continuing in 2014 to date and in February the agreement to acquire the Polish packaging manufacturer, Madrox, near Warsaw, was announced. If completed as expected, this acquisition will add significantly to Robinson's revenues and, once the integration costs are covered, Madrox is expected to substantially improve the Group's earnings and cash flow. The capabilities and new customers that the company brings to Robinson will add to the prospects for further sales growth beyond 2014.

Richard Clothier

Chairman

20 March 2014

Group income statement

FOR THE YEAR ENDED 31 DECEMBER

								2013		2012
								£'000		£'000
Continuing operations
Revenue								23,329		21,171
Cost of sales								(18,148)		(16,141)
Gross profit								5,181		5,030
Operating costs								(2,859)		(2,604)
Operating profit before exceptional items								2,322		2,426
Exceptional items								1,054		(83)
Operating profit after exceptional items								3,376		2,343
Finance income - interest receivable								11		10
Finance costs - bank interest payable								(1)		(9)
Finance income in respect of pension fund								307		474
Profit before taxation								3,693		2,818
Taxation								(599)		(723)
Profit for year attributable to the owners of the Company								3,094		2,095
Basic earnings per share
EPS from continuing operations								19.2p		13.1p
EPS from continuing operations excluding exceptional items								12.6p		13.6p
Diluted earnings per share
EPS from continuing operations								18.5p		12.6p
EPS from continuing operations excluding exceptional items								12.2p		13.1p

Statement of comprehensive income

FOR THE YEAR ENDED 31 DECEMBER

							2013		2012
							£'000		£'000
Profit for the year							3,094		2,095
Items that will not be reclassified subsequently to profit or loss:
Remeasurement of net defined benefit liability							(308)		(3,355)
Deferred tax relating to items not reclassified							152		922
							(156)		(2,433)
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations							3		215
Other comprehensive expense for the year							(153)		(2,218)
Total comprehensive income/(expense) for the year attributable to the owners of the Company							2,941		(123)

Statement of financial position

 AS AT 31 DECEMBER

		Group
		2013		2012
		£'000		£'000
Non-current assets
Property, plant and equipment		10,802		8,857
Deferred tax asset		160		158
Pension asset		4,053		4,224
		15,015		13,239
Current assets
Inventories		2,150		1,608
Trade and other receivables		6,565		6,704
Corporation tax receivable		-		165
Cash		5,375		1,743
		14,090		10,220
Non-current assets held for sale		1,250		4,998
Total assets		30,355		28,457
Current liabilities
Trade and other payables		(4,527)		(4,355)
Corporation tax payable		(130)		(502)
Borrowings		-		(307)
		(4,657)		(5,164)
Non-current liabilities
Deferred tax liabilities		(407)		(524)
Provisions		(187)		(187)
		(594)		(711)
Total liabilities		(5,251)		(5,875)
Net assets		25,104		22,582
Equity
Share capital		82		80
Share premium		610		419
Capital redemption reserve		216		216
Translation reserve		299		296
Revaluation reserve		4,416		4,580
Retained earnings		19,481		16,991
Equity attributable to shareholders		25,104		22,582

Statement of changes in equity

FOR THE YEAR ENDED 31 DECEMBER

Group	Share	Share	Capital	Translation	Revaluation	Retained	Total
	capital	premium	redemption	reserve	reserve	earnings
		account	reserve
	£'000	£'000	£'000	£'000	£'000	£'000	£'000
At 1 January 2012	80	419	216	81	4,567	17,824	23,187
Profit for the year						2,095	2,095
Other comprehensive income/(expense)				215		(2,433)	(2,218)
Tax on revaluation					13		13
Total comprehensive income for the year				215	13	(338)	(110)
Credit in respect of share based payments						63	63
Dividends paid						(558)	(558)
Transactions with owners						(495)	(495)
At 31 December 2012	80	419	216	296	4,580	16,991	22,582
Profit for the year						3,094	3,094
Other comprehensive income/(expense)				3		(153)	(150)
Transfer to revaluation reserves as a result of property transactions					(168)	168	-
Tax on revaluation					4		4
Total comprehensive income for the year				3	(164)	3,109	2,948
Credit in respect of share based payments						43	43
Issue of ordinary shares under employee share option scheme	2	191					193
Dividends paid						(662)	(662)
Transactions with owners	2	191				(619)	(426)
At 31 December 2013	82	610	216	299	4,416	19,481	25,104

Statement of cash flows

FOR THE YEAR ENDED 31 DECEMBER

		Group
		2013		2012
		£'000		£'000
Cash flows from operating activities
Profit for the year		3,094		2,095
Adjustments for:
Depreciation of property, plant and equipment		969		892
Profit on disposal of other plant and equipment		(20)		(148)
Profit on sale of non-current asset		(1,054)		-
Decrease in provisions		-		(2)
Other finance income in respect of Pension Fund		(307)		(474)
Finance costs		1		9
Finance income		(11)		-
Taxation charged		599		723
Other non-cash items:
Pension current service cost and expenses		170		188
Charge for share options		43		63
Operating cash flows before movements in working capital		3,484		3,346
Increase in inventories		(542)		(229)
(Increase)/decrease in trade and other receivables		(641)		341
(Decrease)/increase in trade and other payables		(25)		417
Cash generated by operations		2,276		3,875
UK corporation tax paid		(769)		(643)
Interest paid		(3)		(11)
Net cash generated from operating activities		1,504		3,221
Cash flows from investing activities
Interest received		11		-
Acquisition of plant & equipment		(1,402)		(902)
Proceeds on disposal of plant & equipment		45		254
Proceeds on disposal of non-current assets		4,250		-
Net cash generated from/(used in) investing activities		2,904		(648)
Cash flows from financing activities
Loans repaid		(307)		(335)
Proceeds on issue of shares		193		-
Dividends paid		(662)		(558)
Net cash used in financing activities		(776)		(893)
Net increase in cash and cash equivalents		3,632		1,680
Cash and cash equivalents at 1 January		1,743		63
Cash and cash equivalents at 31 December		5,375		1,743
Cash		5,375		1,743
Cash and cash equivalents at 31 December		5,375		1,743

Notes to the financial statements

1.   Basis of preparation

Whilst this financial information has been prepared in accordance with the recognition and measurement criteria of IFRS, this announcement does not itself contain sufficient information to comply with IFRS. The consolidated and Company financial statements have been prepared under International Financial Reporting Standards (IFRS) as adopted by the European Union. All standards and interpretations that have been issued and are effective at 31 December 2013 have been applied in the financial statements. The financial statements have been prepared under the historical cost convention. No accounting standards coming into effect in 2013 have had any effect on the financial statements, with the exception of IAS 19 (revised) whereby finance costs on the defined benefit scheme have been calculated and disclosed on a net basis.

In determining whether the Group's 2013 financial statements can be prepared on a going concern basis, the Directors considered all factors likely to affect its future development, performance and its financial position, including cash flows, liquidity position and borrowing facilities and the risks and uncertainties relating to its business activities. As at the date of this report, the directors have a reasonable expectation that the Company and Group have adequate resources to continue in business for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the annual financial statements.

2.   Publication of statutory financial statements

The financial information set out above does not constitute the company's statutory financial statements for the years ended 31 December 2012 or 2013, but is derived from those financial statements. The statutory financial statements for the year ended 31 December 2012 have been delivered to the Registrar of Companies and those for 2013 are expected to be posted to shareholders on 7 April 2014 and will be delivered to the Registrar of Companies after they have been laid before the Company at the Annual General Meeting planned for 1 May 2014. Copies will also be available from Robinson plc's registered office: Field House, Wheatbridge, Chesterfield, S40 2AB and on the Group's website at www.robinsonpackaging.com from 7 April 2014. The auditor has reported on those financial statements; their reports were unqualified and did not contain statements under the Companies Act 2006, section 498 (2) or (3).

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