Interim Results
600 Group PLC
22 November 2006
22 November 2006
THE 600 GROUP PLC
INTERIM RESULTS FOR THE 26 WEEKS TO 30th SEPTEMBER 2006
CHAIRMAN'S STATEMENT
Market conditions
During the first half of our financial year, our UK and USA markets continued
the positive trends seen at the end of last year while other European markets
experienced varying degrees of recovery.
Results
The Group's underlying order intake in the first half was ahead of last year
with significant improvements from our operations in the UK and South Africa.
The outstanding order book for the second half is very strong due principally to
the major contracts received last year to supply Mitsui Seiki machines to the UK
aerospace industry.
Revenue grew by 8% from £34.4m to £37.2m with increases in most geographic
areas.
Notwithstanding the increased sales and marketing expenses associated with the
development of the Group (as outlined by Andrew Dick in our last Annual Report),
the Group was able to reduce its operating loss from £1.0m to £0.6m as the
margin benefits resulting from the increased turnover started to come through.
Net financing income (principally related to the Group's pension scheme) was
stable at £0.9m, generating a profit before tax of £0.3m compared with a loss of
£0.1m last year.
Net funds at the period end were £3.5m compared with £4.0m for the corresponding
period end last year and £5.8m at the end of the financial year. The cash
outflow during the first half was due principally to the phasing of working
capital movements.
Dividend
The board does not yet consider that the results allow the payment of a
dividend.
People
John Fussey will be retiring as Group Finance Director at the end of December
when he will be succeeded by Martyn Wakeman who joined the board at the
beginning of October.
As I have been Chairman for 14 years and with the transition from Tony Sweeten
to Andrew Dick as Group Chief Executive successfully accomplished, my fellow
directors are now in the process of appointing my successor, with the intention
that I should retire from the board on his appointment as Chairman.
Outlook
In the likely absence of any major changes in our principal markets, the medium
term outlook for the Group is dependent on the implementation of our development
plans coupled with further improvements in our machine tool supply chains.
During the first half of the year we have made significant improvements to our
machine tool selling organisations in North America and the UK and further
improvements are planned during the second half of the year in continental
Europe. Additional outsourced supply of lathes is now in place with deliveries
due to commence within the next few months. Our laser marking business has also
strengthened its USA selling operation and has continued the expansion and
improvement of its product range with the launch of new technologically advanced
products.
These actions will start to have a positive impact on the Group's performance
during the second half of the year.
Michael Wright
Chairman
22 November 2006
Enquiries:
The 600 Group PLC
Andrew Dick, Group Chief Executive
John Fussey, Group Finance Director Telephone: 0113 277 6100
Hudson Sandler
Nick Lyon Telephone: 020 7796 4133
Consolidated income statement (unaudited)
26 weeks to 26 weeks 52 weeks
30.09.06 to 01.10.05 to 01.04.06
£000 £000 £000
Revenue 37,158 34,435 70,993
Operating loss before restructuring costs (622) (992) (1,410)
Restructuring costs - - (1,876)
Operating loss before financing costs (622) (992) (3,286)
Net financing income 877 854 1,567
Profit/(loss) before tax 255 (138) (1,719)
Income tax (charge)/credit (note 2) (97) 22 (429)
Profit/(loss) for the period 158 (116) (2,148)
Attributable to:
Equity holders of the parent 89 (150) (2,196)
Minority interest 69 34 48
Profit/(loss) for the period 158 (116) (2,148)
Earnings per share - basic and diluted (note 3) 0.2p (0.3)p (3.9)p
Consolidated statement of recognised income and expense (unaudited)
26 weeks to 26 weeks to 52 weeks to
30.09.06 01.10.05 01.04.06
£000 £000 £000
Foreign exchange translation differences (1,039) 693 893
Net actuarial (losses)/gains on employee benefit schemes (1,280) 1,200 9,244
Revaluation of properties - - 3,397
Deferred tax on above items 384 - (3,010)
Net (expense)/income recognised directly in equity (1,935) 1,893 10,524
Profit/(loss) for the period 158 (116) (2,148)
Total recognised (expense)/income for the period (1,777) 1,777 8,376
Attributable to:
Equity holders of the parent (1,756) 1,741 8,295
Minority interest (21) 36 81
Total recognised (expense)/income for the period (1,777) 1,777 8,376
Summarised consolidated balance sheet (unaudited)
At 30.09.06 At 01.04.06 At 01.10.05
£000 £000 £000
Non-current assets
Property, plant and equipment 13,477 14,203 11,476
Intangible assets 2,174 2,072 2,764
Investments 84 84 84
Employee benefits 7,060 7,400 -
Deferred tax assets 303 303 681
23,098 24,062 15,005
Current assets
Inventory 21,573 21,147 22,725
Trade and other receivables 17,054 15,740 14,273
Cash and cash equivalents 5,557 7,657 5,785
44,184 44,544 42,783
Total assets 67,282 68,606 57,788
Non-current liabilities
Employee benefits (2,146) (2,281) (3,626)
Deferred tax liability (2,715) (3,003) (945)
(4,861) (5,284) (4,571)
Current liabilities
Trade and other payables (15,226) (14,633) (12,202)
Income tax payable (83) (134) (26)
Provisions (465) (388) (438)
Loans and other borrowings (2,057) (1,809) (1,758)
(17,831) (16,964) (14,424)
Total liabilities (22,692) (22,248) (18,995)
Net assets 44,590 46,358 38,793
Shareholders' equity
Called-up share capital 14,212 14,212 14,212
Reserves 30,006 31,753 24,222
Total equity attributable to equity holders of the parent 44,218 45,965 38,434
Minority interest 372 393 359
Total equity 44,590 46,358 38,793
Summarised consolidated cash flow statement (unaudited)
26 weeks 26 weeks 52 weeks
to 30.09.06 to 01.10.05 to 01.04.06
£000 £000 £000
Cash flows from operating activities
Profit/(loss) for the period 158 (116) (2,148)
Adjustments for:
Amortisation of development expenditure 54 - 67
Depreciation 622 832 1,640
Impairment of goodwill - - 1,254
Net financial income (877) (854) (1,567)
Profit on disposal of plant and equipment - - (26)
Equity share option expense 9 16 31
Income tax expense/(income) 97 (22) 429
Operating profit/(loss) before changes in working capital and
provisions 63 (144) (320)
(Increase)/decrease in working capital (1,976) 946 3,699
Decrease/(increase) in employee benefits 20 (970) (1,006)
Cash generated from the operations (1,893) (168) 2,373
Interest paid (56) - (170)
Income tax (paid)/received (56) 86 (66)
Net cash from operating activities (2,005) (82) 2,137
Cash flows from investing activities
Interest received - 39 199
Proceeds from sale of plant and equipment - 14 168
Purchase of plant and equipment (192) (261) (520)
Development expenditure capitalised (182) - (402)
Net cash from investing activities (374) (208) (555)
Cash flows from financing activities
Net receipt of external borrowing 1,191 5 (305)
Equity dividends paid - (2,274) (2,274)
Reduction in current asset investments - 346 580
Net cash from financing activities 1,191 (1,923) (1,999)
Net decrease in cash and cash equivalents (1,188) (2,213) (417)
Reduction in current asset investments - (346) (580)
(Increase)/decrease in debt and finance leases (1,191) (5) 305
Decrease in net funds (2,379) (2,564) (692)
Net funds at beginning of period 5,848 6,617 6,617
Exchange effects on net funds 31 (26) (77)
Net funds at end of period 3,500 4,027 5,848
Notes to the financial information
1. Basis of preparation
The 600 Group PLC (the "Company") is a public limited company incorporated and
domiciled in England and Wales. The Company's ordinary shares are traded on the
London Stock Exchange. The Consolidated Interim Financial Statements of the
Company for the 26-week period ended 30 September 2006 comprise the Company and
its subsidiaries (together referred to as the "Group").
The Consolidated Interim Financial Statements have been prepared on the basis of
the recognition and measurement requirements of International Financial
Reporting Standards ("IFRSs") in issue and endorsed by the EU and effective at
30 September 2006 but do not include all the information required for full
Financial Statements.
The Statements have been prepared using the accounting policies and presentation
that were applied in the Company's published Consolidated Financial Statements
for the 52-week period ended 1 April 2006, copies of which can be obtained from
the Company's website.
The Consolidated Interim Financial Statements do not constitute statutory
accounts and are unaudited. Statutory accounts for the 52-week period ended 1
April 2006 have been delivered to the Registrar of Companies. KPMG Audit Plc,
The 600 Group PLC's auditors, reported on those accounts under section 235 of
the Companies Act 1985. Their report was unqualified and did not contain a
statement under section 237(2) or (3) of that Act.
2. Taxation
The charge for corporation tax comprises UK taxation £nil (2005: £nil), overseas
taxation charge of £1,000 (2005: credit £17,000) and deferred taxation charge of
£96,000 (2005: credit £5,000).
3. Earnings per share
The basic earnings per share is based on the profit for the period of £89,000
(2005: loss £150,000) and the weighted average number of shares outstanding of
56,847,149 (2005: 56,846,137). For diluted earnings per share, the weighted
average number of ordinary shares in issue is adjusted to 56,921,107 and assumes
conversion of dilutive potential ordinary shares of 73,958. In determining the
diluted earnings per share for 2005, no adjustments were required from the basic
earnings per share as all potential ordinary shares were anti-dilutive.
4. Interim report
Copies of the interim report will be sent to all shareholders and will be
available to members of the public from the company's registered office at 600
House, Landmark Court, Revie Road, Leeds, LS11 8JT.
The 600 Group PLC is registered in England and Wales No. 196730.
5. Share price information
Information concerning the day-to-day movement of The 600 Group PLC share price
can be found by dialling 0906 003 4031 for the Financial Times share price
service.
The 600 Group PLC
600 House
Landmark Court
Revie Road
Leeds
LS11 8JT
Telephone: 44 (0) 113 277 6100
Facsimile: 44 (0) 113 276 5600
www.600group.com
This information is provided by RNS
The company news service from the London Stock Exchange