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Toye & Co PLC (TOYE)

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Thursday 15 May, 2014

Toye & Co PLC

Final Results

RNS Number : 2157H
Toye & Co PLC
15 May 2014
 



 

TOYE & COMPANY PLC

(AIM: TOYE)

 

Preliminary Final Results for the Year Ended 31 December 2013

 

The Board of Toye & Company Plc ("Toye" or "the Company") announces today Final Results for the year ended 31 December 2013.

 

Contacts:




Toye & Company plc

www.toye.com

Fiona Toye, Chief Executive

+44 (0) 20 7242 0471



WH Ireland Limited

www.wh-ireland.co.uk

Mike Coe, Ed Allsopp

+44 (0) 117 945 3470

 

 

 

Extracts from the Strategic Report

 

RESULTS

 

Turnover for the year ended 31 December 2013 amounted to £6,466,927 compared to £8,936,996 for the previous year.  As previously reported the prior year included significant contracts that did not recur in 2013. There was an operating profit of £520,705 in 2012.  Because of the decreased turnover in 2013 there was an operating loss of £679,932 before sale of the Great Queen Street property.

 

During December 2013 the Board and management began the implementation of our long-term strategic plan for improving the operational performance of the Group. Redundancy costs of £172,397 have been included in the 2013 figures which have adversely affected our trading results.

 

Investment has been made in sales expertise and initiatives which might not generate profit until late 2014 and beyond.

 

The Group has made a profit of £942,078 before and after tax. The key contributor to this result was the disposal of the Great Queen Street site. The profit on this transaction was £1,603,480.

 

Our earnings per share for the year therefore increased from 20.19p in 2012 to 41.91p.

 

 

 

SALE OF GREAT QUEEN STREET

 

On 28 January 2013 the Company entered into an unconditional loan facility agreement, legal charge, and sale agreement to dispose of its leasehold property at 19-21 Great Queen Street ("the Property") to Stability Investments Limited for a consideration of at least £2.75 million.  At 28 January 2013, the date of sale, the Property had a carrying value of £942,984. 

 

Subject to certain conditions being met, the Company may be entitled to additional consideration of £500,000 and a share of any ultimate development profit relating to the property.  At the time of preparing these accounts the Company did not have evidence to support that the conditions would be met.  The Directors therefore have no alternative other than to consider that the receipt of the additional consideration is very unlikely and as such no allowance has been made in these accounts for any additional consideration.

 

Under the terms of the agreement, two representatives of Stability Investments Limited, Robin Edwards and Robert Luck, have been appointed as Non-Executive Directors of the Company.

 

Full details of the transaction can be found in note 25 on page 40 of the annual report.

 

TRADING CONDITIONS

 

The economic recession shows signs of ebbing.  There was some positive news in the last UK budget and there is cautious confidence in the financial press.  However the reality is that average wages and salaries have not increased and investment returns are low.  The retail market is a good indicator of recovery, and though improved it is hardly booming.

 

We have global competition in all our markets, and our long heritage, British manufacturing base and Royal Warrant are effective advantages as we compete for a larger share of the business.  Success will depend on our ability to exploit our advantages, manage our operating costs and expand our capabilities.

 

MANAGEMENT AND STAFF

 

Mr N K S Wills retired as a non-executive of the Company with effect from 31 December 2013.  Nicholas has been a valuable and long serving member of the Board since his appointment in 1996.  We wish him well.

 

During the year we have with regret made further redundancies throughout all tiers of the business including senior management.

 

We have retained all our essential trade skills, and through training and new recruits we are enhancing our abilities and capabilities in production, purchasing and sales.

 

We continue to work a 34 hour week, with sales and administration working flexible hours to cover customer services.  Surges in requirement for production are effectively handled by overtime work and the use of outworkers and ancillary businesses.

 

Facilities

Our operational facilities in the Midlands are unique not only in what they do, but in their strong ties to their locations.  All our skilled staff live locally to the sites, and there is an irreplaceable network of outworkers and small ancillary businesses that support our production.  A London office and Showroom is essential for the sales Divisions.  Our Design Studio is based in the Birmingham factory, and some marketing services are out-sourced.

 

PROGRESS AND OUTLOOK

 

2013 has been a year of planning and transition. The tough trading conditions of the last few years have concentrated the minds of the Board and management on reconfiguring the Company for the next one hundred years.

 

Difficult decisions have had to be made concerning personnel, and Great Queen Street. It is essential that we maintain our presence in London, and we will be established in a new central location in 2015.

 

The key objectives of the Strategic Plan have already been outlined in this report.  The management are implementing the new Divisional structure which will improve accountability, and focus the Divisional team members on driving their sector of the business for optimum performance and profit.

 

To reflect our streamlined operational structure we are reviewing the presentation and marketing of our Brand to make it clear to customers and potential customers what we can do for them, and make it easy for them to buy from us.

 

We are enhancing our traditional skills with the latest technological aides for design and engineering that will allow us to achieve a consistency in execution and delivery of beautifully crafted product designed and made in England.

 

The  Strategic Report was approved by the Board on 15 May 2014 and signed on its behalf by:

F A Toye

Chief Executive

 

Group Statement of Comprehensive Income

for the year ended 31 December 2013







2013

£

2012

£






Revenue



6,466,927

8,936,996

Operating expense



(7,146,859)

(8,416,291)

(Loss) /profit on operations before profit on sale of property



(679,932)

520,705






Profit on sale of leasehold property



1,603,480

-

Profit from operations



923,548

520,705






Finance costs



(84,537)

(66,833)

Finance income



103,067

-






Profit before taxation



942,078

453,872






Taxation



-

-






Profit and total comprehensive income for the year



942,078

453,872






All of the comprehensive income for the year is attributable to equity holders of the parent.

 

 

All activities relate to continuing operations.

 






Earnings per share

Earnings per share (basic and diluted)



 

41.91p

 

20.19p



 

Statements of Financial Position

at 31 December 2013


Company Number 198641


The Group

The Company


2013

£

2012

£

2013

£

2012

£

Assets

Non-current assets





Property, plant & equipment

938,184

1,959,086

871,760

1,858,786

Investments in subsidiary undertakings

-

-

1,024,614

1,155,852


938,184

1,959,086

1,896,374

3,014,638






Current assets





Inventories

1,154,248

1,154,462

-

-

Trade and other receivables

3,420,234

1,115,709

3,074,218

3,041

Cash and cash equivalents

431,751

4,390

27

-


5,006,233

2,274,561

3,074,245

3,041






Liabilities

Current liabilities





Trade and other payables

1,244,560

1,133,324

175,667

946,760

Current borrowings

2,079,897

559,687

2,079,897

-

Current portion of long term borrowings

-

120,607

-

120,607


3,324,457

1,813,618

2,255,564

1,067,367






Net current assets / (liabilities)

1,681,776

460,943

818,681

(1,064,326)






Non-current liabilities





Non-current borrowings

-

742,147

-

742,147


-

742,147

-

742,147






Net assets

2,619,960

1,677,882

2,715,055

1,208,165






Equity attributable to equity holders of the parent





Ordinary shares

562,000

562,000

562,000

562,000

Share premium

2,677

2,677

2,677

2,677

Retained earnings

2,055,283

1,113,205

2,150,378

643,488

Total equity

2,619,960

1,677,882

2,715,055

1,208,165








 

Statements of Changes in Equity

for the year ended 31 December 2013











Ordinary

shares

£

Share

premium

£

Retained

earnings

£

Total

equity

£

The Group





Balance at 1 January 2012

562,000

2,677

659,333

1,224,010






Changes in equity for 2012





Profit and total comprehensive income for the year

-

-

453,872

453,872






Balance at 31 December 2012

562,000

2,677

1,113,205

1,677,882






Changes in equity for 2013





Profit and total comprehensive income for the year

-

-

942,078

942,078






Balance at 31 December 2013

562,000

2,677

2,055,283

2,619,960






All equity is attributable to equity holders of the parent.















The Company





Balance at 1 January 2012

562,000

2,677

632,042

1,196,719






Changes in equity for 2012





Profit and total comprehensive income for the year

-

-

11,446

11,446






Balance at 31 December 2012

562,000

2,677

643,488

1,208,165






Changes in equity for 2013





Profit and total comprehensive income for the year

-

-

1,506,890

1,506,890






Balance at 31 December 2013

562,000

2,677

2,150,378

2,715,055








 

Statements of Cash Flows

for the year ended 31 December 2013






The Group

The Company


2013

£

2012

£

2013

£

2012

£

Cash flows (used in) / generated from operating activities





Cash (used in) / generated from operating activities

(97,897)

464,475

(1,171,043)

211,778

Interest received

-

-

72,000

72,000

Interest paid

(4,640)

(66,833)

(4,640)

(66,833)

Net cash (used in) / generated from operating activities

(102,537)

397,642

(1,103,683)

216,945






Cash flows from investing activities





Purchase of property, plant and equipment

(14,125)

(121,536)

-

(95,854)

Payments in respect  of disposal of fixed asset

(33,536)

-

(33,536)

-

Net cash flows (used in) investing activities

(47,661)

(121,536)

(33,536)

(95,854)






Cash flows from financing activities





Repayment of borrowings

(862,754)

(121,091)

(862,754)

(121,091)

New financing

2,000,000

-

2,000,000

-

Net cash flows generated from / (used in) financing activities

1,137,246

(121,091)

(121,091)






Net increase in cash and cash equivalents

987,048

155,015

27

-

Cash and cash equivalents at the beginning of the year

 

(555,297)

 

(710,312)

 

-

 

-

Cash and cash equivalents at the end of         the financial year

431,751

(555,297)

27

-











 

 

 



 

1.      Basis of preparation

The consolidated financial statements from which this financial information is extracted have been prepared in accordance with IFRS and International Financial Reporting Interpretations Committee ("IFRIC") interpretations as adopted by the European Union, and those parts of the Companies Act 2006 applicable to companies reporting under IFRS.

 

 

2.     Segmental reporting

 

In identifying its operating segments, management generally follow the manufacturing or sourcing of the products.

 

The Group operates in the supply of identity products to a large and varied market and customer base.  The type of products sold into this market generally fall under either a textile or metals (including corporate gifts) umbrella.  The exception to this being the friendly societies market.

 

Each of the textile, metals and friendly societies operating segments is managed separately as each of these segments requires different resources and core skills.  All transfers between the segments are carried out at cost.

 

The measurement policies the Group uses for segment reporting under IFRS 8 are the same as those used in its financial statements.

 

Management currently identifies three units as operating segments as described above. These operating segments are monitored and strategic decisions are made on the basis of segment operating results.










Textiles

Friendly societies

Metals

Total



2013

£

2013

£

2013

£

2013

£

Revenue


2,294,414

1,529,754

2,642,759

6,466,927







Gross profit


1,487,628

471,239

837,952

2,796,819

Works overheads


504,658

51,250

473,383

1,029,291

Manufacturing contribution by segment

982,970

419,989

364,569

1,767,528







Selling and administration costs



(2,099,888)

(Loss) before finance, restructuring and redundancy costs,  profit on sale of Great Queen Street property  and costs associated with the AIM listing

(332,360)







Restructuring and redundancy costs





(172,397)

Profit on sale of Great Queen Street




1,603,480

Costs associated with the AIM listing





(107,894)

Other bank charges and leasing costs



(67,281)

Interest



(84,537)

Finance income



103,067

Net profit





942,078









Textiles

Friendly societies

Metals

Total



2012

£

2012

£

2012

£

2012

£

Revenue


3,140,400

1,049,822

4,746,774

8,936,996







Gross profit


1,503,728

384,028

2,156,602

4,044,358

Works overheads


538,755

47,744

564,104

1,150,603

Manufacturing contribution by segment

964,973

336,284

1,592,498

2,893,755







Selling and administration costs



(2,207,490)

Profit before finance and costs associated with the AIM listing

686,265






Costs associated with the AIM listing





(83,377)

Other bank charges and leasing costs



(82,183)

Interest



(66,833)

Net profit





453,872







The Group's revenues from external customers are divided into the following geographical markets:





2013

£

2012

£

United Kingdom




4,858,985

7,256,232

Rest of World




1,607,942

1,680,764





6,466,927

8,936,996







All non-current assets are held within the United Kingdom.







During 2013 no single customer accounted for 10% or more of the Group's revenue.  During 2012, £1,955,450 or 21.9% of the Group's revenues depended on a single customer whose sales were made from the metals segment. 

 

The assets of the business have been attributed to the segments on the following basis.

 



Textiles

Friendly societies

Metals

Total



2013

£

2013

£

2013

£

2013

£

Inventories


635,969

278,785

239,494

1,154,248

Unallocated assets





4,790,169

Unallocated liabilities





(3,324,457)









2012

£

2012

£

2012

£

2012

£

Inventories


624,088

258,746

271,628

1,154,462

Unallocated assets





3,079,185

Unallocated liabilities





(2,555,765)

 

Non-current assets are not allocated between segments.

 

All segments of the Group sell into the same markets and share many of the same customers and thus receivables are not attributed to the individual business segments.

 

Similarly all segments of the Group purchase from the same suppliers and as such the trade payables are not attributed to the business segments.

 

Borrowing and finance costs are arranged centrally by the Group and are not attributed to the business segments.

 

 

3.     Operating expenses by nature




2013

£

2012

£

Changes in inventories of finished goods and work in progress

878

199,824

Raw materials and consumables used

2,596,686

3,697,883

Employee benefits

2,521,330

2,930,599

Depreciation  -  owned assets

71,631

96,691

Audit and non-audit services

50,300

36,350

Hire of plant and machinery

53,756

35,599

Other expenses

1,852,278

1,419,345


7,146,859

8,416,291




 

 

 

 

4.     Profit for the financial year



 




 

The profit dealt with in the accounts of the Parent Company was £1,506,890 (2012: £11,446).  The Parent Company had no other comprehensive income for the year other than the profit for the year (2012: £nil).

 




 

5.     Earnings per ordinary 25p share






The earnings per ordinary 25p share is based on the profit or loss after taxation and the average number of shares in issue throughout the year.


2013

2012

Profit

£942,078

£453,872

Average number of shares in issue

2,248,000

2,248,000

Profit per share - basic and diluted

41.91p

20.19p




There were no potentially dilutive ordinary shares in issue.

 

6.     Share Capital




2013

£

2012

£

Authorised

  3,000,000 Ordinary shares of 25p each

 

750,000

 

750,000

Allotted and fully paid

  2,248,000 Ordinary shares of 25p each

 

562,000

 

562,000




 

 

7.     Cash generated from/(used in) operating activities

 






The Group

The Company


2013

£

2012

£

2013

£

2012

£

Profit from operations

923,548

520,705

1,285,122

6,279

Depreciation - property, plant and equipment

71,631

96,691

23,630

39,788

(Profit) on sale of fixed assets

(1,587,168)

-

(1,583,068)

-

Addition to provision against investments

-

-

131,238

-

Decrease in inventories

214

196,842

-

-

Decrease/(increase) in trade and other receivables

382,642

(147,240)

(388,110)

365

Increase/(decrease) in trade and other payables

111,236

(202,523)

(639,855)

165,346


(97,897)

464,475

(1,171,043)

211,778













 

8.     Sale of leasehold land and buildings






 

On 28 January 2013 the Company entered into an unconditional loan facility agreement, legal charge, and sale agreement to dispose of its leasehold property at 19-21 Great Queen Street ("the Property") to Stability Investments Limited for a consideration of at least £2.75 million.  At 28 January 2013, the date of sale, the Property had a carrying value of £942,984. 

 

Subject to certain conditions being met, the Company may be entitled to additional consideration of £500,000 and a share of any ultimate development profit relating to the property.  At the time of preparing these accounts the Company did not have evidence to support that the conditions would be met.  The Directors therefore have no alternative other than to consider that the receipt of the additional consideration is very unlikely and as such no allowance has been made in these accounts for the additional considerations.

 

Loan Facility Agreement and Legal Charge

 

The loan facility agreement provides that Stability Investments Limited advances to the Company an amount of up to £2.5 million.  This advance is secured by a legal charge and all other outstanding charges over the Company's interest in the Property have been redeemed.

 

Of the advance, £2,000,000 was paid to the Company on 28 January 2013.  A further £500,000 will be released to the Company, on agreement of and in line with the business plan and the remaining £250,000 on 28 July 2014 or completion of the sale if earlier.

 

£2,000,000 of the advance has been applied by the Company to repay in full the indebtedness of the Group to Lloyds Bank plc and to meet the working capital requirements of the Group. 

 

The advance attracts compound interest at a rate of 3.75 per cent above the Bank of England base rate.

 

Under the terms of the loan facility agreement, two representatives of Stability Investments Limited, Robin Edwards and Robert Luck, have been appointed as Non-Executive Directors of the Company.

 

Sale Agreement

 

The sale agreement provides that Stability Investments Limited shall complete the transaction on or before 28 July 2014.  The purchase price is payable on completion of the transfer of the Company's interest in the Property, which is then applied to repay in full amounts advanced under the loan facility agreement, and accrued interest.  The Company's entitlement to such additional consideration and/or to any share of development profit is contingent upon certain future events occurring which, if they occur, will be payable at future dates which cannot yet be determined.

 

 

The financial information, which has been prepared on the same basis as set out in the 2012 Annual Accounts, does not constitute statutory accounts as defined in section 435 of the Companies Act 2006.  The financial information for the year ended 31 December 2013 has been extracted from the statutory accounts on which an unqualified audit opinion has been issued.  Statutory accounts for the year ended 31 December 2013 will be delivered to the registrar in due course.  The comparative financial information is based on the statutory accounts for the financial year ended 31 December 2012.  Those accounts, upon which the auditors issued an unqualified opinion, have been delivered to the registrar of companies.

 

The Report and Accounts will be posted later today to Shareholders and the Annual General Meeting will be held on 19 June 2014 at 12.30 pm at the company's offices at Regalia House, 19-21 Great Queen Street, London, WC2B 5BE.  The Report and Accounts will also be available from the Company's website, www.toye.com.

 

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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