Half-year Report

RNS Number : 2445J

Slingsby(H.C.)Plc

20 August 2021

 

Prior to publication, the information contained within this announcement was deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). With the publication of this announcement, this information is now considered to be in the public domain.

20 August 2021

H C Slingsby plc

("Slingsby" or "the Company")

Report for the half year ended 30 June 2021

Statement by the Chairman

Trading

In my trading update of 9 June 2021, I reported that Group sales in the four months to 30 April 2021 were 6% higher than prior year but that gross margin was lower, meaning that unaudited profit before tax was £0.1m compared to £0.2m in the prior year.  We were cautious regarding the outlook due to continued uncertainty caused by the coronavirus pandemic.  Whilst the Group's sales grew in 2020 due to demand for virus related products, the same level of order intake that was experienced in 2020 had not recurred in 2021.  In addition, the Group has experienced significant cost price increases across its product range as well as higher shipping costs and delays which impacted on gross margin.

Group sales in the six months to 30 June 2021 were 5% lower than in the same period in 2020.  This fall in sales together with a continuation in the trend regarding gross margin, led to an unaudited profit before tax of £0.1m in 2021 compared to an unaudited profit before tax of £0.4m in the same period in 2020.

The market remains competitive and it remains unclear what impact the pandemic will have on demand going forward.  The downward trend in gross margin is likely to persist for the remainder of the year and there is also heightened potential for credit related issues should customers become insolvent.

Balance sheet

The Group had net assets of £1.96m at 30 June 2021 compared to net assets of £1.21m at 31 December 2020.  This improvement is due to a decrease in the liability relating to the defined benefit pension scheme of £0.7m (after associated deferred tax).  The retirement benefit obligation decreased during the six months to 30 June 2021 due to an increase in the discount rate used by the scheme actuary.  This has the impact of decreasing scheme liabilities, which outweighed a decrease in the value of scheme assets.  The Company made deficit reduction contributions totalling £199,000 in the six months to 30 June 2021, in line with the agreement with the scheme's Trustee.

Cashflow

The Group had net cash of £0.8m at 30 June 2021 (net debt of £0.4m at 30 June 2020) compared to £0.3m at 31 December 2020.  The Group continues to operate within its existing banking facilities and the Directors continue to believe that the Group has additional funding options available should the need arise.

Dividend

Due to the uncertain outlook, the Board has decided not to declare an interim dividend.  It is the Board's intention to re-commence dividend payments to shareholders as soon as it is prudent to do so.

People

We would like to thank our employees for their hard work and flexibility which has enabled the Group to continue its operations during a challenging time.

Dominic Slingsby

Interim Executive Chairman and Operations Director

For further information please contact:

H C Slingsby plc

Dominic Slingsby, Interim Executive Chairman    01274 535 030

Morgan Morris, Group Chief Executive

Allenby Capital Limited

David Worlidge / George Payne    020 3328 5656

Unaudited Condensed Consolidated Income Statement for the half year ended 30 June 2021

		Half year	Half year	Year
		ended	ended	ended
		30/06/21 (Unaudited)	30/06/20 (Unaudited)	31/12/20 (Audited)
	Note	£'000	£'000	£'000
Revenue		9,950	10,455	21,806
		---------	---------	---------
Operating profit		156	505	1,263
Finance costs		(61)	(81)	(154)
		--------	--------	--------
Profit before taxation		95	424	1,109
Taxation	2	(26)	(38)	(163)
		--------	--------	--------
Profit for the period attributable to equity shareholders		69 --------	386 --------	946 --------
Basic and diluted weighted average earnings per share		6.6p	38.6p	92.3p
		--------	--------	--------

The results set out above derive entirely from continuing operations.

The above unaudited condensed consolidated income statement should be read in conjunction with the accompanying notes.

Unaudited Consolidated Statement of Comprehensive Income and Expense for the half year ended 30 June 2021

			Half year	Half year	Year
			ended	ended	ended
			30/06/21 (Unaudited)	30/06/20 (Unaudited)	31/12/20 (Audited)
			£'000	£'000	£'000
Profit for the period			69	386	946
Items that will not be reclassified to profit or loss
Remeasurements of post-employment benefit obligations			842	(883)	(1,784)
Movement in deferred tax relating to retirement benefit obligation			(160)	150	339
			--------	--------	--------
Other comprehensive income/(expense)			682	(733)	(1,445)
			--------	--------	--------
Total comprehensive income/(expense) recognised for the period attributable to equity shareholders			751	(347)	(499)
			--------	--------	--------

The above unaudited consolidated statement of comprehensive income and expense should be read in conjunction with the accompanying notes.

Unaudited Consolidated Balance Sheet as at 30 June 2021

		30/06/21 (Unaudited)	30/06/20 (Unaudited)	31/12/20 (Audited)
		£'000	£'000	£'000
Assets
Non-current assets
Property, plant and equipment		4,962	5,089	5,084
Intangible assets		453	650	518
Goodwill		700	700	700
Deferred tax asset		1,367	1,239	1,553
		---------	---------	--------
		7,482	7,678	7,855
		---------	---------	--------
Current assets
Inventories		2,164	2,456	2,224
Trade and other receivables		2,658	3,046	2,632
Cash and cash equivalents Derivative financial asset		2,076 2	1,696 7	1,781 -
		---------	---------	---------
		6,900	7,205	6,637
		---------	---------	---------
Liabilities
Current liabilities
Trade and other payables Bank borrowings Derivative financial obligations Lease obligations		(3,172) (1,275) - (34)	(3,534) (2,126) - (32)	(2,948) (1,506)    (7)    (34)
Current tax liabilities		(150)	-	-
		---------	---------	---------
		(4,631)	(5,692)	(4,495)
		---------	---------	---------
Net current assets		2,269	1,513	2,142
		---------	---------	---------
Non-current liabilities
Retirement benefit obligation Lease obligations		(7,194) (15)	(7,359) (50)	(8,175) (32)
Deferred tax liabilities		(583)	(458)	(582)
		---------	---------	---------
Net assets		1,959	1,324	1,208
		---------	---------	---------
Capital and reserves
Share capital		262	250	262
Share premium		24	-	24
Retained earnings		1,673	1,074	922
		---------	---------	---------
Total equity		1,959	1,324	1,208
		---------	---------	---------

The above unaudited consolidated balance sheet should be read in conjunction with the accompanying notes .

Unaudited Consolidated Statement of Changes in Shareholders' Equity

	Share Capital £'000	Share premium £'000	Retained earnings £'000	Total equity £'000
At 1 January 2020	250	-	1,421	1,671
Total comprehensive expense recognised for the period	-	-	(347)	(347)
	---------	---------	---------	---------
At 30 June 2020	250	-	1,074	1,324
	---------	---------	---------	---------
At 1 January 2021	262	24	922	1,208
Total comprehensive income recognised for the period	-	-	751	751
	---------	---------	---------	---------
At 30 June 2021	262	24	1,673	1,959
	---------	---------	---------	---------

The above unaudited consolidated statement of changes in shareholders' equity should be read in conjunction with the accompanying notes . 

Unaudited Consolidated Statement of Cash Flows for the half year ended 30 June 2021

		Half year	Half year	Year
		ended	ended	ended
		30/06/21 (Unaudited)	30/06/20 (Unaudited)	31/12/20 (Audited)
	Note	£'000	£'000	£'000
Cash flows from operating activities
Cash generated from operations	3	590	787	1,594
UK corporation tax paid		-	-	(41)
Interest received/(paid)		1	(12)	(13)
		---------	---------	---------
Cash generated from operating activities		591	775	1,540
		---------	---------	---------
Cash flows from investing activities
Purchase of property, plant and equipment		(44)	(30)	(108)
Purchase of intangible assets		(3)	(12)	(18)
Proceeds from sales of property, plant and equipment		-	-	6
		---------	---------	---------
Net cash outflow from investing activities		(47)	(42)	(120)
		---------	---------	---------
Cash flows from financing activities
Capital element of  lease payments		(18)	(18)	(36)
Proceeds from share issue		-	-	36
Proceeds from/(repayment of) borrowing		-	510	(1,034)
(Decrease)/Increase in overdraft		(231)	(807)	117
		---------	---------	---------
Net cash used in  financing activities		(249)	(315)	(917)
		---------	---------	---------
Net increase in cash and cash equivalents		295	418	503
Opening cash and cash equivalents		1,781	1,278	1,278
		---------	---------	---------
Closing cash and cash equivalents		2,076	1,696	1,781
		---------	---------	---------

The above unaudited consolidated statement of cash flows should be read in conjunction with the accompanying notes.

Notes to the Interim Report for the half year ended 30 June 2021

1.	Interim Financial Information
	The unaudited condensed consolidated interim financial information does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. The interim financial statements, which are unaudited and have not been reviewed by the Company's auditors, have been prepared in accordance with the policies set out in the 2020 Annual Report and Accounts. The comparative figures for the year ended 31 December 2020 do not constitute full financial statements and have been abridged from the full accounts for the year ended on that date, on which the auditors gave an unqualified report.  They did not contain any statement under Section 498 of the Companies Act 2006. The 2020 accounts have been delivered to the Registrar of Companies.  The Company has chosen not to adopt IAS 34 'Interim Financial Statements'.
2.	Taxation	Half year	Half year	Year
		ended	ended	ended
		30/06/21 (Unaudited)	30/06/20 (Unaudited)	31/12/20 (Audited)
		£'000	£'000	£'000
	Current tax	-	24	150
	Deferred tax	26	14	13
		---------	---------	---------
		26	38	163
		---------	---------	---------
	The effective tax rate is 27%.
3.	Cash generated from operations
		Half year	Half year	Year
		ended	ended	ended
		30/06/21 (Unaudited)	30/06/20 (Unaudited)	31/12/20 (Audited)
		£'000	£'000	£'000
	Profit before tax	95	424	1,109
	Net finance costs	61	81	154
	Depreciation and amortisation	234	210	430
	Defined benefit pension scheme contributions paid	(199)	(150)	(304)
	Profit on sale of property, plant and equipment	-	-	(6)
	Decrease/(Increase) in inventories	60	(322)	(90)
	Decrease in trade and other receivables	(27)	(652)	(231)
	Increase in trade and other payables	366	1,196	532
		---------	---------	---------
	Cash generated from operating activities	590	787	1,594
		---------	---------	---------

4.  Availability of Interim Report

The Interim Report will be available on the Company's website www.slingsby.com.

 

END

 

 

IR SFAESUEFSEEA