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Alumasc Group Plc (ALU)

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Tuesday 11 February, 2003

Alumasc Group Plc

Interim Results

Alumasc Group PLC
11 February 2003


                  THE ALUMASC GROUP plc - INTERIM ANNOUNCEMENT


• Alumasc, the high specification building and engineering group,
announces improved underlying turnover and profits for the half year to 31
December 2002, continuing the advances of the previous financial year.

• Operating profit increased by 4.2% to £3.6 m on turnover up 3.6% at
£58.2 m.

• The continuing business (which excludes Alumasc Grundy and Leonardo
Internet) increased turnover by 9.2% to £56.3 m, pre-tax profit by 57.6% to £3.8
m and EPS by 57.4% to 7.4p. This reflects both the strong performance of the
continuing business and the high profits earned by Alumasc Grundy in the
previous year.

• An unchanged interim dividend per share of 2.45p has been declared.

• Net borrowings of £2.4 m compare with £6.3 m a year previously, and
the Group's strong balance sheet places it in an excellent position for future
development.

• On continuing business, both Divisions increased their profit on
higher turnover.  The expected increases in insurance and pension costs were
off-set by cost reductions elsewhere, generating higher margins.

• The Engineering Division's pre-tax profit from continuing business of
£1.9 m increased by 63.4% on turnover of £38.7 m, 11.7% ahead, with Precision
Components continuing to attract new business and the continuing Industrial
Products companies strongly ahead. These results exclude Alumasc Grundy
following the announcement in December 2002 of its planned closure.

• The Building Products Division increased turnover by 4.2% to £17.6 m,
with some signs emerging of the promised increase in public sector spending, and
pre-tax profit up 20.4% to £1.7 m, benefiting from the  increased turnover and
operational improvements of the past year.  These results exclude Leonardo
Internet, which was sold on 7 February 2003.

• John McCall, Chairman, stated "It would be unwise to make short term
predictions for our business given the market uncertainties that follow the
current economic and political turbulence. Alumasc continues to work on
improving its businesses by incremental steps and to build on its strengths
within the limits of its own capabilities and market realities.   The improved
performance in the first half year and the previous year fuel our determination
for further progress."



Presentation:

A presentation to brokers' analysts and private client investment advisers will
be held at 11.00 a.m. today at Bankside Consultants, 123 Cannon Street, London,
EC4N 5AU.



Enquiries:

The Alumasc Group plc                                            01536-383844
  John McCall (Chairman)
  Paul Hooper (Group Managing Director)

Bankside Consultants Limited                                     020-7444 4167
  Charles Ponsonby                                               07789-202 312




                              CHAIRMAN'S STATEMENT

Summary

It is pleasing to be able to report improved underlying turnover and profits for
the half year to 31 December 2002, continuing the advances of the previous
financial year.

The Group's operating profit of £3.6 million was 4.2% ahead of the previous
year, on turnover of £58.2 million, ahead by £2.0 million or 3.6%.

The improvement in the performance of the continuing business - which excludes
Alumasc Grundy and Leonardo Internet - was more striking, with turnover of
£56.3 million ahead by £4.7 million (+9.2%) and profit before tax 57.6% higher
at £3.8 million.  This reflects both the stronger performance of our continuing
business and the high profits earned by Alumasc Grundy in the previous year.  A
gain of £0.3 million was made on the sale of a surplus freehold property.  
Earnings per share for the continuing business increased by 57.4% to 7.4p 
(2001 : 4.7p).

The costs of closing Alumasc Grundy are estimated at £0.85 million.  In
addition, goodwill of £2.4 million, originally written off to reserves in 1988,
is accounted for under FRS 2, reducing the Group's profit before tax to £0.6
million in the period and resulting in a loss after tax of £0.4 million.  The
goodwill write off has no impact on cash or reserves.

The Board has declared an unchanged interim dividend of 2.45p per share which
will be payable on 7 April 2003 to shareholders on the register at close of
business on 14 March 2003.

Operations

The Group's continuing business moved ahead in the half year with both divisions
increasing their profit on higher sales.  The expected increases in insurance
and pensions costs were offset by cost reductions elsewhere enabling higher
margins to be earned.

The Engineering Division's profit from continuing business of £1.9 million
increased by £0.75 million (63.4%) on turnover of £38.7 million, 11.7% ahead.
Within this division, Precision Components continued to attract new business in
the period;  however, growth from new projects with customers such as BMW Mini,
Caterpillar and Orange Box was held back by weakness in some of the more
established accounts towards the end of 2002.  Alumasc Precision's investment
programme was scaled back in response to these signs of market weakness.  The
environmental accreditation ISO 14001 was achieved at the division's largest
facility with further audits to follow.  Our Industrial Products companies,
excluding Alumasc Grundy, were strongly ahead, with Alumasc Dispense performing
particularly well on new work won during the previous year.

The Building Products Division showed further improvement, achieving sales of
£17.6 million (+4.2%) with some signs emerging of the promised increase in
public sector spending.  Profit of £1.7 million (+20.4%) was a strong
performance in mixed market conditions and further demonstrated benefits from
the operational improvements of the past year.

Discontinued business

It was with great regret that the Board announced in December 2002 the February
2003 closure of Alumasc Grundy, the beer barrel manufacturing and repair
operation in Burton Upon Trent.  This was for many years a core activity for
Alumasc and contributed strongly to the Group's results up until the last
financial year.  However, a permanent downturn in business was flagged in
statements accompanying the 2002 report and accounts and the subsequent AGM.
The severity of this decline, brought about by permanent changes in the
structure of the UK brewing industry, has resulted in the decision to close.
The costs of closure have been taken into account in the half year results.  It
is hoped that these costs will be recovered from the future development of the
site.

In keeping with its focus on premium engineering and building products, the
Group sold Leonardo Internet, its 71% owned web design business, to Eleco plc on
7 February 2003 for a total cash consideration of £200,000.  The business is
treated as being discontinued for the half year to 31 December 2002.

Financial

Net borrowings rose by £0.5 million in the period, to £2.4 million, representing
gearing of 7 per cent, and compare with £6.3 million a year previously.  This is
a good performance for the half year, taking normal annual cash flows into
account, and reflects a satisfactory generation of cash from operations, aided
by the sale for
£1 million of a surplus freehold property.  The Group's strong balance sheet
places it in an excellent position for future development.
  
Board appointment

I am delighted to announce that Paul Hooper, who joined Alumasc as Group
Managing Director in April 2001, will become Chief Executive on 1 March 2003.

Prospects

It would be unwise to make short term predictions for our business given the
market uncertainties that follow the current economic and political turbulence.

Alumasc continues to work on improving its businesses by incremental steps, and
to build on its strengths within the limits of its own capabilities and market
realities.

The improved performance in the first half year and the previous year fuel our
determination for further progress.


John McCall
Chairman

11 February 2003



                      Unaudited Consolidated Balance Sheet
                              at 31 December 2002

                                                      31 December         31 December           30 June
                                                             2002                2001              2002
                                         Notes               £000                £000              £000
Fixed assets
Intangible assets                                              62                  68                66
Tangible assets                                            29,931              30,850            31,425
Investments                                                   524                 452               468
                                                          _______             _______           _______

                                                           30,517              31,370            31,959
                                                          _______             _______           _______
Current assets
Stocks                                                     12,530              12,654            11,997
Debtors                                                    20,880              22,412            21,939
Cash at bank and in hand                                      989                   -             2,231
                                                          _______             _______           _______

                                                           34,399              35,066            36,167
                                                          _______             _______           _______
Creditors: amounts falling due within one year
Trade and other creditors                                  22,024              26,195            24,572
Taxation                                                    1,311               1,331             1,410
Proposed dividend                                             850                 850             2,098
                                                          _______             _______           _______

                                                           24,185              28,376            28,080
                                                          _______             _______           _______

Net current assets                                         10,214               6,690             8,087
                                                          _______             _______           _______

Total assets less current                                  40,731              38,060            40,046
liabilities
Creditors: amounts falling due
after more than one year                                    4,161               3,952             4,831
Provisions for liabilities and                                809                 346               598
charges
Equity minority interest                                      102                  92               112
                                                          _______             _______           _______

Net assets                                                 35,659              33,670            34,505
                                                          =======             =======           =======
Capital and reserves
Called up share capital                                     4,352               4,352             4,352
Share premium                                              26,907              26,907            26,907
Revaluation reserve                                         2,021               2,168             2,021
Capital redemption reserve                                    693                 693               693
Profit and loss account                                     1,686               (450)               532
                                                          _______             _______           _______

Equity shareholders' funds                   8             35,659              33,670            34,505
                                                          =======             =======           =======





               Unaudited Consolidated Profit and Loss Account
                     for the half year to 31 December 2002

                                         Half year                         Half year                               Year
                                  31 December 2002                  31 December 2001                       30 June 2002
                                                                     
                          Discontinued/                         Discontinued/                     Discontinued/
             Continuing           to be            Continuing          to be          Continuing         to be
Note         activities    discontinued     Total  activities   discontinued   Total  activities  discontinued    Total
                   £000    £000    £000      £000        £000           £000    £000        £000          £000     £000
2   Turnover     56,272           1,976    58,248      51,527          4,673  56,200     110,526         7,121  117,647

2   Operating
    profit        3,592              45     3,637       2,587            904   3,491       6,791         1,086    7,877

2   Share of 
    operating
    profit in
    associates       55               -        55          20              -      20          60             -       60
    Profit on 
    fixed           
    asset 
    disposals       305               -       305           -              -       -           -             -        -

    Loss on 
    business                   
    closure:               

    Business 
    closure
    costs                  (854)

    Goodwill 
    write
    back              -  (2,388) (3,242)   (3,242)          -              -       -           -             -        -

    Net 
    interest       
    payable        (199)              -      (199)       (226)             -    (226)       (460)            -     (460)
                   _____          ______    ______      ______         _____    ______      _____        _____     _____

    Profit/
    (loss) 
    on
    ordinary
    activities 
    before        
    taxation      3,753          (3,197)      556       2,381            904   3,285       6,391         1,086    7,477
4   Taxation 
    (charge)/    
    credit       (1,170)            236      (934)       (748)          (272) (1,020)     (1,925)         (329)  (2,254)
                  _____           ______    ______      ______         _____   ______      _____         _____    _____

    Profit/
    (loss) on
    ordinary
    activities 
    after         
    taxation      2,583          (2,961)     (378)      1,633            632   2,265       4,466           757    5,223
    Equity 
    minority         
    interest         (6)              -        (6)         (1)             -      (1)        (24)            -      (24)
                  _____           ______    ______      ______         _____   ______      _____         _____    _____ 
    Profit/
    (loss) for
    the 
    financial
    period        
    attributable 
    to 
    shareholders  2,577          (2,961)     (384)      1,632            632   2,264       4,442           757    5,199
    Dividends      (850)              -      (850)       (850)             -    (850)     (2,948)            -   (2,948)
                  _____           ______    ______      ______         _____   ______      _____         _____    _____ 
    Retained 
    profit/(loss) 
    for the
    financial 
    period        1,727          (2,961)   (1,234)        782            632   1,414       1,494           757    2,251
                  _____           ______    ______      ______         _____   ______      _____         _____    _____ 


5   Earnings/
    (loss)
    per share 
    and
    diluted 
    earnings/      
    (loss) 
    per share      7.4p           (8.5)p    (1.1)p       4.7p           1.8p    6.5p       12.7p          2.2p    14.9p
                  _____           ______    ______      ______         _____   ______      _____         _____    _____

6   Dividend 
    per share                                2.45p                             2.45p                               8.5p
                                            ______                             ______                              _____



Statement of Total Recognised Gains and Losses

There are no recognised gains or losses other than the loss attributable to
shareholders of the Company of
£384,000 for the half year to 31 December 2002 (profit of £2,264,000 for the
half year to December 2001 and profit of £5,199,000 for the year to 30 June
2002).




                   Unaudited Consolidated Cash Flow Statement
                     for the half year to 31 December 2002


                                                         Half year          Half year            Year
                                                       31 December        31 December         30 June
                                                              2002               2001            2002
                                                              £000               £000            £000

Cash inflow from operating                                   2,892              3,376          12,271
activities*
                                                           _______            _______         _______

Returns on investments and servicing of finance
Net interest paid                                            (199)              (226)           (460)
Dividends paid to minority shareholders                       (17)               (23)               -
                                                           _______            _______         _______

                                                             (216)              (249)           (460)
                                                           _______            _______         _______

Taxation
UK corporation tax paid                                      (911)               (56)           (938)
                                                           _______            _______         _______

Capital expenditure and financial
investment
Purchase of tangible fixed assets                          (1,238)            (3,687)         (4,487)
Proceeds from sale of tangible fixed                         1,060                132             226
assets
                                                           _______            _______         _______

                                                             (178)            (3,555)         (4,261)
                                                           _______            _______         _______

Acquisitions and disposals
Proceeds/ deferred consideration from
sale of business activities                                      -                380             379
                                                           _______            _______         _______

Equity dividends paid                                      (2,098)            (2,098)         (2,948)
                                                           _______            _______         _______

Financing
Increase in medium term secured borrowings and
lease financing                                                  -              1,558           2,054
Repayment of amounts borrowed                                (409)                  -           (116)
                                                           _______            _______         _______

                                                             (409)              1,558           1,938
                                                           _______            _______         _______

(Decrease)/ increase in cash in the period                   (920)              (644)           5,981
                                                           =======            =======         =======



*Reconciliation of operating profit to net cash inflow from operating activities


Operating profit                                             3,637              3,491           7,877
Depreciation                                                 1,979              1,820           3,811
Amortisation of goodwill                                         4                  6               8
(Profit)/ loss on disposal of tangible fixed                   (2)                  5            (33)
assets
(Increase)/ decrease in working capital                    (2,700)            (1,753)           1,745
Decrease in warranty and other provisions                     (26)              (193)         (1,137)
                                                           _______            _______         _______

                                                             2,892              3,376          12,271
                                                           =======            =======         =======





                         Notes on the Unaudited Accounts
                              at 31 December 2002


1 Basis of preparation

The interim financial statements for the half year ended 31 December 2002 have
been prepared in accordance with the accounting policies detailed in the 2002
Annual Report & Accounts. The financial information for the year ended 30 June
2002 is an abridged version of the financial statements filed with the Registrar
of Companies, on which the auditors gave an unqualified report. The financial
information for the half year ended 31 December 2001 and year ended 30 June 2002
is restated for business activities treated as discontinued and to be
discontinued as at 31 December 2002.  The interim report is being posted to
shareholders and copies are available to the public at the registered office,
Burton Latimer, Kettering, Northamptonshire NN15 5JP.


2 Analysis of turnover and operating profit, including associates, on continuing
activities
                                                        Half year                Half year
                                                   31 December 2002            31 December 2001
                                              Turnover         Profit       Turnover         Profit
                                                  £000           £000           £000           £000

Engineering products                            38,661          1,930         34,621          1,181
Building products                               17,611          1,717         16,906          1,426
                                               _______        _______        _______        _______

                                                56,272          3,647         51,527          2,607
                                               =======        =======        =======        =======



3 Activities discontinued/ to be discontinued

Activities discontinued comprise the results of Leonardo Internet Limited, a web
development business which was sold on 7 February 2003; activities to be
discontinued comprise the results of the Alumasc Grundy business, which
manufactures and repairs beer barrels for the brewing industry, and which is
expected to be closed in early March 2003.


                                                             Half year         Half year              Year
                                                           31 December       31 December           30 June
                                                                  2002              2001              2002
                                                                  £000              £000              £000
Discontinued:

Turnover                                                            59                50               122
                                                               _______           _______           _______

Operating profit/ (loss)                                            13              (56)              (76)
                                                               _______           _______           _______
To be discontinued:
Turnover                                                         1,917             4,623             6,999
                                                               _______           _______           _______

Operating profit                                                    32               960             1,162
                                                               _______           _______           _______
Total:
Turnover                                                         1,976             4,673             7,121
                                                               _______           _______           _______

Operating profit                                                    45               904             1,086
                                                               _______           _______           _______





                         Notes on the Unaudited Accounts
                              at 31 December 2002


4 Taxation

The taxation provided is based on an estimated effective rate for the year.

                                                             Half year         Half year              Year
                                                           31 December       31 December           30 June
                                                                  2002              2001              2002
                                                                  £000              £000              £000

Current tax - UK Corporation tax                                   812               891             1,877
Deferred tax                                                       122               129               377
                                                               _______           _______           _______

                                                                   934             1,020             2,254
                                                               =======           =======           =======



5 Earnings per share

Earnings per share is based on the weighted average number of ordinary shares in
issue for the period of 34,816,788 (31 December 2001: 34,816,788; year ended 30
June 2002: 34,816,788).


6 Dividends

The directors have declared an interim dividend per share of 2.45p (2001: 2.45p)
which will be paid on 7 April 2003 to shareholders on the register at the close
of business on 14 March 2003.


7 Reconciliation of net cash flow to movement in net debt

                                                      Half year          Half year            Year
                                                    31 December        31 December         30 June
                                                           2002               2001            2002
                                                           £000               £000            £000

(Decrease)/ increase in cash in the period                (920)              (644)           5,981
Cash outflow/ (inflow) from change in debt
and lease financing                                         409                  -         (1,938)
                                                        _______            _______         _______

Change in net debt from cash flows in the                 (511)              (644)           4,043
period
New medium term secured borrowings                            -            (1,558)         (1,822)
                                                        _______            _______         _______

Movement in net debt in the period                        (511)            (2,202)           2,221
Net debt at start of period                             (1,851)            (4,072)         (4,072)
                                                        _______            _______         _______

Net debt at end of period                               (2,362)            (6,274)         (1,851)
                                                        =======            =======         =======





                         Notes on the Unaudited Accounts
                              at 31 December 2002


8 Reconciliation of movement in shareholders' funds

                                                    Half year            Half year               Year
                                                  31 December          31 December            30 June
                                                         2002                 2001               2002
                                                         £000                 £000               £000

Retained (loss)/ profit for the financial             (1,234)                1,414              2,251
period
Exchange difference                                         -                    -                (2)
Goodwill write back on disposal of                      2,388                    -                  -
business
                                                      _______              _______            _______

Net increase in shareholders' funds                     1,154                1,414              2,249
Opening shareholders' funds                            34,505               32,256             32,256
                                                      _______              _______            _______

Closing shareholders' funds                            35,659               33,670             34,505
                                                      =======              =======            =======




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