17th Mar 2005 07:00
Premier Farnell plc 17 March 2005 Premier Farnell, the leading global marketer and distributor of electronic, maintenance, repair and operations (MRO) and specialist products and services, today announces its Results for the fourth quarter and the financial year ended 30January 2005. Q4 2004/5 Q4 2003/4 FY 2004/5 FY 2003/4 ‚£m ‚£m ‚£m ‚£m*** (restated) Turnover 185.0 180.5 776.7 764.6 Operating profit 17.2 18.0 73.8 69.0 Adjusted operating profit* 17.8 18.6 76.5 74.0 Profit before taxation 13.8 14.7 60.3 54.8 Profit before taxation, 14.4 15.3 63.0 57.3 goodwill amortisation and gain on business disposal Earnings per share 3.3p 2.8p 11.0p 9.0p Adjusted earnings per share** 3.4p 2.9p 11.7p 10.2p * before one-off rebranding costs in 2003/4 and goodwill amortisation** before one-off rebranding costs in 2003/4, goodwill amortisation and gain onbusiness disposal*** restated to reflect the adoption of UITF 38, Accounting for ESOP Trusts,which had the impact of increasing operating profit and profit before taxationfor the full year of 2003/4 by ‚£0.2million. Highlights * Group sales in the year up 6.4%¢â‚¬ , and up 4.7%¢â‚¬ in the fourth quarter * Marketing and Distribution Division (MDD) sales up 6.3%¢â‚¬ in the year, with 9.8% increase in North America in the fourth quarter * Profit before tax of ‚£60.3million up 10.0% despite an 11% year on year decline in the US dollar and the disappointing performance of BuckHickman InOne * Robust Group gross margin of 40.7% in the fourth quarter (Q4 2003/4: 40.3%) continuing the steady improvement during the year * MDD eCommerce sales up 56% in the year. In the fourth quarter they accounted for 17% (Q4 2003/4: 13%) of MDD's sales with strong growth in both eProcurement and through websites * Earnings per share for the year up 22.2% to 11.0p (2003/4: 9.0p) * Recommended final dividend of 5.0p, to give a full year dividend of 9.0p (2003/4: 9.0p) Commenting on the results, John Hirst, Group Chief Executive said:"Premier Farnell continued to make good progress this year. We achieved solidgrowth in sales, and profit before tax rose by 10%, despite the continuedweakness of the US dollar."After a strong first half, the rate of growth in the North Americanelectronics market began to ease in the third quarter and was showing only verylimited growth by the year-end. Nonetheless, the Group's rate of sales growthin North America held steady in the fourth quarter and we continued to improvegross margin. Sales at Farnell InOne reached record levels this year, despiteslowing European markets in the second half. These sales were helped by aparticularly strong performance in mainland Europe."Sales at BuckHickman InOne in the fourth quarter were down marginally on thecorresponding period last year, although monthly sales per day from Novemberwere up sequentially. The actions taken, and in hand, give us greaterconfidence for the recovery of this business in the coming year."We continue to make progress on our strategic priorities; developing corporateaccounts, expanding our presence with smaller customers, improving productranges and providing industry-leading service through eCommerce and traditionalmarketing channels. The significant operational improvements made to thebusiness in recent years give us confidence that we can continue to improve ourperformance and our market share."¢â‚¬ percentage changes in salesComparison of sales for specific periods is affected by three variables: 1. Changes in exchange rates used to translate the overseas sales in different currencies into sterling; 2. Differences in the number of working days; 3. Disposal or acquisition of businesses. Throughout this statement, in order to reflect underlying business performance,percentage changes in sales are based on sales per day for continuingbusinesses at constant exchange rates and for like periods, unless otherwisestated.For further information, contact:John Hirst, Group CEO Premier Farnell plc +44 (0) 20 7851 4100Andrew Fisher, Group Finance Director James Garthwaite, Group Director, Communications Richard Mountain Financial Dynamics (UK) +44 (0) 20 7269 7291 Andrew Saunders Taylor Rafferty (NA) + 1 212 889 4350 The Preliminary Results presentation to analysts on 17 March 2005 will berecorded and be available on the Group web site later that day.Premier Farnell's announcements and presentations are published on the Internetat www.premierfarnell.com, together with business information, the 2004 AnnualReport and Accounts, and links to all other Group web sites.The results for the first quarter of the financial year to 29 January 2006 willbe announced on 2 June 2005.Premier Farnell plc CHAIRMAN'S STATEMENT ON RESULTS FOR THE FINANCIAL YEAR ENDED 30 JANUARY 2005. Premier Farnell, the leading global marketer and distributor of electronic,maintenance, repair and operations (MRO) and specialist products and services,today announces its results for the fourth quarter and twelve months ended 30January 2005.Note: percentage changes in salesComparison of sales for specific periods is affected by three variables: 1. Changes in exchange rates used to translate the overseas sales in different currencies into sterling; 2. Differences in the number of working days; 3. Disposal or acquisition of businesses. Throughout this statement, in order to reflect underlying business performance,percentage changes in sales are based on sales per day for continuingbusinesses at constant exchange rates and for like periods, unless otherwisestated.Financial Results * Turnover Group sales for the year were ‚£776.7million (2003/4: ‚£764.6million) and salesper day increased 6.4% on the prior year. In the fourth quarter, sales were ‚£185.0million (Q4 2003/4: ‚£180.5million) up 4.7% year on year and 2.1% abovethose in the third quarter.The continued weakness of the US dollar against sterling impacted the Group'sfinancial results. At constant exchange rates, the sales increase in the yearwas ‚£47.6million and in the fourth quarter was ‚£9.0million. * Margins and Operating Profit Full Year resultsThe Group's gross margin for the year was 40.5% (2003/4: 40.2%). Operatingprofit was ‚£73.8million (2003/4: ‚£69.0million), producing an operating marginof 9.5% (2003/4: 9.0%). Adjusted operating profit was ‚£76.5million, beforegoodwill amortisation of ‚£2.7million (2003/4: ‚£74.0million, before rebrandingcosts of ‚£2.4million and goodwill amortisation of ‚£2.6million), producing anadjusted operating margin of 9.8% (2003/4: 9.7%). Operating profit was affectedby a reduction in the net pension credit of ‚£1.3million and a ‚£0.8millionincrease in depreciation following the roll-out of the customer relationshipmanagement (CRM) software.At constant exchange rates, the increase in adjusted operating profit comparedto the prior year was ‚£6.5million, representing a rise of 9.3%.Fourth Quarter resultsThe Group's gross margin in the fourth quarter showed further progress reaching40.7%, compared with 40.4% in the first nine months of the year. Operatingprofit was ‚£17.2million compared to ‚£18.0million in the corresponding periodlast year primarily as a result of the reduced contribution from BuckHickmanInOne. Adjusted operating profit before goodwill amortisation in the fourthquarter was ‚£17.8million (2003/4: ‚£18.6million).At constant exchange rates, the decrease in operating profit compared to theprior year was ‚£0.4million. * Interest The net interest charge for the year of ‚£13.5million (2003/4: ‚£14.3million) wascovered 5.7 times by operating profit before goodwill amortisation. * Profit Before Tax Profit before tax for the year was ‚£60.3million (2003/4: ‚£54.8million) whilstprofit before tax and goodwill amortisation was ‚£63.0million (2003/4: ‚£57.3million before goodwill amortisation and gain on business disposal). In thefourth quarter, profit before tax was ‚£13.8million (Q4 2003/4: ‚£14.7million)and adjusted profit before tax was ‚£14.4million (Q4 2003/4: ‚£15.3million). * Earnings per Share Earnings per share for the year were 11.0p (2003/4: 9.0p), up 22.2%. Adjustedearnings per share for the year, before amortisation of goodwill, were 11.7p,up 14.7% (2003/4: 10.2p before amortisation of goodwill, rebranding costs andgain on business disposal). Earnings per share for the fourth quarter were 3.3p(Q4 2003/4: 2.8p). Adjusted earnings per share for the fourth quarter, beforeamortisation of goodwill, were 3.4p, up 17.2% (Q4 2003/4: 2.9p beforeamortisation of goodwill). * Dividend The Board is recommending a final dividend of 5.0p (2003/4: 5.0p) making atotal for the year of 9.0p (2003/4: 9.0p). The dividend is covered 1.2 times byprofit attributable to ordinary shareholders and 1.3 times by profitattributable to ordinary shareholders before goodwill amortisation. The finaldividend is payable on 22 June 2005 to shareholders on the register on 27 May2005. * Balance Sheet and Cash Flow Total shareholder's funds rose to ‚£121.6million (1 February 2004: ‚£112.1million). Net debt at 30 January 2005 was ‚£200.7million (1 February 2004:‚£201.9million). The Group's net cash flow from operating activities in the yearof ‚£72.5million was 95% of operating profit before goodwill amortisation (2003/4: ‚£70.0million, or 98%). Working capital increased by ‚£19.9million during theyear, driven by investment in inventory to support product range expansion andby sales growth in the period. Net cash outflow after dividends and ‚£2.6millionof acquisitions was ‚£7.0million. * Acquisition On 6 February 2004, the Group acquired the business of GFE Manufacturing, anIllinois-based supplier of lighting systems and water flow test equipment forthe fire-fighting industry, for ‚£2.6million. This acquisition, which expandedAkron Brass's product range, has exceeded expectations for sales and profit. * Pensions The Group accounts for pensions in accordance with SSAP 24. The profit and lossaccount includes a net credit of ‚£1.6million (2003/4: ‚£2.9million) withinoperating profit in relation to all of the Group's pension schemes. Thiscomprises a credit of ‚£5.0million in respect of the surplus in the NorthAmerican defined benefit scheme and a charge of ‚£3.4million in respect ofdefined benefit and defined contribution schemes in the UK and the rest of theworld. * International Financial Reporting Standards (IFRS) The Group is required to report under IFRS for future financial periods. Itwill be publishing the effects of the transition to these standards on itsfinancial statements for the year ended 30 January 2005 on 4 May 2005.The principal effects of IFRS on the Group are as follows: * the Company's preference shares will be re-classified from shareholders' funds to debt, with the preference dividend being shown as a finance cost; * pensions will be accounted for in accordance with IAS 19 which broadly follows FRS 17; * a charge to the profit and loss account will be required for share-based incentives; * amortisation of goodwill will cease and the carrying value of goodwill will be subject to an annual test for impairment; and * final dividends will not be accrued until declared and approved at the AGM. OperationsMarketing and Distribution Division (MDD)MDD comprises: Newark InOne; Farnell InOne; BuckHickman InOne; MCM, an InOnecompany; and CPC.Market OverviewMost of the markets in which the division operates showed some improvementduring the first half of the year. This trend was led by North America, wherethe rate of growth peaked in the early summer. The North American market wasshowing only very limited growth by the year-end. During the year, FarnellInOne continued to achieve market share gains across European markets despitethe slowdown in the growth rates in these markets in the latter part of theyear. Q4 2004/5 Q4 2003/4 FY 2004/5 FY 2003/4 ‚£m ‚£m ‚£m ‚£m Turnover 161.1 157.3 680.0 668.2 Operating profit 16.0 16.3 69.2 62.6 Adjusted operating 16.6 16.9 71.8 67.6 profit* Return on sales% 9.9% 10.4% 10.2% 9.4% Adjusted return on 10.3% 10.7% 10.6% 10.1% sales%* *before goodwill amortisation of ‚£2.6million (2003/4: ‚£2.6million) and one-offrebranding costs of ‚£2.4million in 2003/4Divisional sales for the year were ‚£680.0million (2003/4: ‚£668.2million) up6.3%. Sales in the fourth quarter were ‚£161.1million, up 4.5%.Investment in technologyThe benefits of the Group's investment in information technology over recentyears continued to show. eCommerce sales grew strongly during the year, up 56%on the prior year. In the fourth quarter, eCommerce sales accounted for 18% ofsales in the Americas and 17% of those in the Europe and Asia Pacific region.By the year-end, the new web search engine was running on almost all of theDivision's web sites. There are now 378 live eProcurement partnerships acrossthe division, up from 282 at the start of the year.The Group made further progress on the development of a single informationtechnology platform across MDD during the year. In May, the global publishingsystem (`STEP') was implemented in the European businesses following itsimplementation in Newark InOne in October 2003. The system enables the globalmanagement of product data and dramatically increases the flexibility andefficiency of paper and electronic catalogue production. New products, andproduct information updates, can now be released weekly to websites across MDD.STEP has enabled a significant expansion of the product range within the Frenchlanguage catalogue, released shortly after the year-end.The AmericasNewark InOne and MCM, an InOne Company. Q4 2004/5 Q4 2003/4 FY 2004/5 FY 2003/4 ‚£m ‚£m ‚£m ‚£m Turnover 67.2 65.0 289.8 286.1 Operating profit 6.3 6.2 27.7 25.8 Adjusted operating 6.3 6.2 27.7 27.0 profit* Return on sales % 9.4% 9.5% 9.6% 9.0% Adjusted return on 9.4% 9.5% 9.6% 9.4% sales %* *before one-off rebranding costs of ‚£1.2million in 2003/4Sales in the year were up 11.7%. In the fourth quarter, sales were up 9.8%,reflecting the slower rate of growth evident in the North American market inthe later part of the third, and into the fourth, quarter. At constant exchangerates, the increase in sales in the year was ‚£30.6million.Operating profit for the year increased ‚£1.9million and adjusted operatingprofit for the year increased ‚£0.7million, after ‚£0.8million of increaseddepreciation on the CRM software implemented during the first quarter of lastyear. At constant exchange rates, the increase in adjusted operating profit was‚£3.3million in the year. The operating margin for the year was 9.6% (2003/4:9.0%, or 9.4% before one-off rebranding costs of ‚£1.2million).Gross margin in the Americas improved steadily over the year and in the fourthquarter the rate was some 1.8% higher than in the fourth quarter of the prioryear.Sales through eProcurement partnerships grew 58% in the year. A total of 171eProcurement partnerships were in place with Newark InOne's customers by theyear-end. In the second half of the year new partnerships went live with,amongst others, Canadian National Railways, Fedex, Sony Pictures, TRW and afurther three divisions of G.E. Sales to national accounts continued to growwell, as more customers moved to eProcurement relationships.Sales over the web grew 48% in the year after accelerating in the fourthquarter, up 52%. Newark InOne's new web search engine was launched in Septemberand the web site now gives customers more efficient access to an extendedproduct range. This includes 138,000 products featured in last year'scatalogue, launched in September, and many additional products introduced sincethe catalogue was printed.Newark InOne's active customer base grew by over 5% in the year. This progressreflects healthier market conditions and the impact of the businesses' CRMsystem and improved marketing capabilities. Wider catalogue distribution,campaigns to recruit new customers and eCommerce sales activities havecontributed to this growth.Newark InOne's technical support team was expanded significantly in March.Other value-added services were also added in response to feedback fromcustomers during the year, including a reeling service for components used oncontinuous tape. This saves customers both time and money.Sales from operations in Canada, Mexico and Brazil continued to grow stronglyin the fourth quarter.Europe and Asia PacificFarnell InOne, BuckHickman InOne and CPC. Q4 2004/5 Q4 2003/4 FY 2004/5 FY 2003/4 ‚£m ‚£m ‚£m ‚£m Turnover 93.9 92.3 390.2 382.1 Operating profit 9.7 10.1 41.5 36.8 Adjusted operating 10.3 10.7 44.1 40.6 profit * Return on sales % 10.3% 10.9% 10.6% 9.6% Adjusted return on 11.0% 11.6% 11.3% 10.6% sales %* *before goodwill amortisation of ‚£2.6million (2003/4: ‚£2.6million) and one-offrebranding costs of ‚£1.2million in 2003/4Sales were up 2.4% for the year and up 0.6% in the fourth quarter. At constantexchange rates, the growth in sales in the year was ‚£10.7million. Return onsales was 10.6% (2003/4: 9.6%) and the adjusted return on sales for the yearwas 11.3% (2003/4: 10.6%). Profit delivered in the year and in the fourthquarter, was impacted by a decreased contribution from BuckHickman InOne.In the UK, sales for the year were ‚£256.8million (2003/4: ‚£260.6million)representing a sales per day decline of 1.5% in the year.Farnell InOne UK grew sales by 3.8% in the year, whilst sales in the fourthquarter were flat year-on-year. This strong performance in a market that showeddecline in the fourth quarter was achieved through continued growth in sales tomajor accounts and through eCommerce channels. In addition, targetedtelemarketing campaigns helped the business to stimulate growth in salesamongst its smaller customers and resulted in a 2% growth in the activecustomer base year on year for Farnell InOne overall.CPC's sales for the year declined 1.6% as market conditions became moredifficult during the second half amongst small business customers, many of whomserve the retail market. The business has implemented a number of changes toits marketing to counteract the softer market conditions.At BuckHickman InOne, the rapid expansion of its business in 2003/4 contributedto a decline in customer service which was still evident at the start of thefinancial year. Restoring service to the Group's standards was achieved by theend of the first half, but it took some time for customer confidence to berestored, a pre-requisite for a return to sales growth. As a consequence, salesfor the year were down 5.8%. However, in the fourth quarter the decline insales was reduced to 0.6% and monthly sales per day from November were upsequentially. Service to larger corporate customers has not been compromisedand sales to this segment continued to progress well during the year.During the year, the partnership of BuckHickman InOne, Farnell InOne and CPC,achieved a 12% rise in sales to corporate account customers in the UK. PremierFarnell was reappointed as preferred supplier to the UK higher educationsegment by the National Universities Working Party on Electronic Components(NUWPEC) in July. Amongst others, the UK businesses secured additional businesswith Corus and two further agreements were reached with The United KingdomAtomic Energy Authority. The UK businesses also delivered steady sales growththrough agreements with Rolls-Royce and Vauxhall Motors.Since the year-end, a single management team has been put in place forBuckHickman InOne and Farnell InOne in the UK, reflecting the ever-closerrelationship between the two businesses. Their most immediate priority is tobring BuckHickman InOne's recovery programme to completion.Sales in Mainland Europe performed well, up 9.9% in the year and up 6.5% in thefourth quarter. Whilst markets were patchy in the fourth quarter, the businesscontinued to deliver strong sales growth in some regions including Germany andItaly.The division's new web site platform and search engine has now been deployed inall businesses in Europe, with the exception of BuckHickman InOne which willfollow in the first half of the current year. These changes are encouragingmigration to eCommerce channels and driving up sales via websites. Sales viathe web are growing strongly and accounted for up to 35% of total sales in thefourth quarter in some regions. Sales for the year via eProcurement agreementsand over the web were up 96% and 56% respectively.After a strong performance in the first nine months, sales growth in Asiaslowed to 8.5% in the fourth quarter, resulting in sales growth for the year of25.4%. In December the division's web search engine was implemented across theAsian businesses. In addition, an experienced local manager has been appointedas Farnell-Newark InOne's first General Manager in China to lead development inthe Chinese market.In Australia, sales in the year were up 6.4%, representing good growth in aflat market.Supplier relationshipsThe business has made significant progress in offering innovative value-addedmarketing services to suppliers. During the year, and for the first time,product launch campaigns were run globally for a number of electronic suppliersincluding Molex, targeting the industrial sector, and Microchip targetingelectronic design engineers.RoHS Legislation (Restriction of the use of certain Hazardous Substances)The division made good progress in preparing for the European Union's RoHSDirective, due to become law on 1 July 2006. From this date, producers ofcertain categories of electronic and electrical equipment will be prohibitedfrom selling products within the European Union that contain six restrictedsubstances, unless specific exemptions apply. Similar legislation is pending ina number of US States and in China.The legislation has significant implications for the electronics industry andPremier Farnell has been working closely with suppliers to provide leadershipin assisting customers prepare for the legislation. It will affect a largenumber of the electronic components and products stocked by the Group andrequire the addition of a material number of compliant products to thedivisions' inventories.Industrial Products Division (IPD) Q4 2004/5 Q4 2003/4 FY 2004/5 FY 2003/4 ‚£m ‚£m ‚£m ‚£m Turnover: 23.9 23.2 96.7 95.7 Continuing businesses Businesses disposed - - - 0.7 Total 23.9 23.2 96.7 96.4 Operating profit 3.2 3.3 13.4 13.7 Adjusted operating 3.2 3.3 13.5 13.7 profit* Return on sales % 13.4% 14.2% 13.9% 14.2% Adjusted return on 13.4% 14.2% 14.0% 14.2% sales %* *before goodwill amortisation of ‚£0.1million (2003/4: ‚£nil)The Industrial Products Division achieved sales of ‚£96.7million (2003/4: ‚£96.4million) for the year, with sales per day up 7.4%. Sales in the fourthquarter were up 5.7%.At constant exchange rates, the increase in sales for continuing businesses inthe year was ‚£7.0million and in the fourth quarter was ‚£1.4million. At constantexchange rates, operating profit and adjusted operating profit for the yearwere up ‚£0.7million and ‚£0.8million respectively, and in the fourth quarteroperating profit was flat year-on-year.Akron BrassSales for the year at Akron Brass were up 12.8% and, in the fourth quarter,were up 6.5%. This reflected solid organic growth and strong sales from the newlighting products introduced through the acquisition of GFE Manufacturing inthe first quarter of the year. In the fourth quarter, whilst sales in the USmarket were flat, international orders were strong, particularly from Europeanvehicle builders. Investment in additional machining capacity assisted thebusiness to improve its profitability over the year.TPC Wire & CableTPC achieved sales growth of 10.3% for the year and 12.5% for the fourthquarter. During the year, the business overcame weak demand from the automotiveand steel sectors by introducing new products and targeting new customers inother sectors. Broad strength in its markets, including those for MRO productsand in Canada and Mexico, helped performance in the fourth quarter.KentSales at Kent grew 2.8% in the year and 3.2% in the fourth quarter, reflectingfurther market share gains. Growth was achieved, in part, through the launch ofan innovative range of abrasive tools. Profits for the year improved throughtight cost control.Board changesOn 1 March 2005, my predecessor, Sir Malcolm Bates, retired as non-executiveChairman after seven years with Premier Farnell. His leadership was invaluableduring a period of transformation for the Group.OutlookThe rate of growth in the North American market peaked in the early summer andslowed towards the end of the year. The Group's plans have been prepared in theexpectation that the North American market will show no growth in the firsthalf and may only begin to strengthen in the second half of this fiscal year.In weaker underlying markets in the UK and mainland Europe there are specificopportunities for the Group to grow market share and the action that we havetaken should lead to a better performance from BuckHickman InOne. In addition,special efforts will be focused on helping our customers to comply with theimpending RoHS legislation.The quality of our service to both customers and suppliers is increasinglyunderpinned by the technology infrastructure that has been put in place. Thesignificant operational improvements and increased marketing effectivenessbuilt into the business over recent years give us confidence that we cancontinue to improve our performance and our market shares.Sir Peter GershonChairman17th March 2005Cautionary Statement for Purposes of the "Safe Harbor" Provisions of the UnitedStates Private Securities Litigation Reform Act of 1995: The U.S. PrivateSecurities Litigation Reform Act of 1995 provides a "safe harbor" forforward-looking statements. This press release contains certain forward-lookingstatements relating to the business of the Group and certain of its plans andobjectives, including, but not limited to, future capital expenditures, futureordinary expenditures and future actions to be taken by the Group in connectionwith such capital and ordinary expenditures, the introduction of newinformation technology and e-commerce platforms, the expected benefits andfuture actions to be taken by the Group in respect of certain sales andmarketing initiatives, operating efficiencies and economies of scale. By theirnature forward-looking statements involve risk and uncertainty because theyrelate to events and depend on circumstances that will occur in the future.Actual expenditures made and actions taken may differ materially from theGroup's expectations contained in the forward-looking statements as a result ofvarious factors, many of which are beyond the control of the Group. Thesefactors include, but are not limited to, the effect of legislative andregulatory enactments, the implementation of cost-saving initiatives to offsetcurrent market conditions, integration of new personnel and new informationsystems, continued use and acceptance of e-commerce programs and systems andthe impact on other distribution systems, the ability to expand into newmarkets and territories, the implementation of new sales and marketinginitiatives, changes in demand for electronic, electrical, electromagnetic andindustrial products, rapid changes in distribution of products and customerexpectations, the ability to introduce and customers' acceptance of newservices, products and product lines, product availability, the impact ofcompetitive pricing, fluctuations in foreign currencies, and changes ininterest rates and overall market conditions, particularly the impact ofchanges in world-wide and national economies.Consolidated Profit and Loss Account For the fourth quarter and financial year ended 30th January 2005 2004/5 2003/4 2004/5 2003/4 Fourth Fourth Full Full year quarter quarter year audited unaudited unaudited audited (restated) Notes ‚£m ‚£m ‚£m ‚£m Turnover 1 185.0 180.5 776.7 764.6 Operating profit - before rebranding costs and 17.8 18.6 76.5 74.0amortisation of goodwill - rebranding costs - - - (2.4) - amortisation of goodwill (0.6) (0.6) (2.7) (2.6) Total operating profit 1 17.2 18.0 73.8 69.0 Profit on disposal of - - - 0.1business Net interest payable (3.4) (3.3) (13.5) (14.3) Profit before taxation 3 13.8 14.7 60.3 54.8 Taxation 4 (0.3) (3.1) (13.8) (15.6) Profit after taxation 13.5 11.6 46.5 39.2 Preference dividends (1.7) (1.6) (6.6) (6.6)(non-equity) Profit attributable to 11.8 10.0 39.9 32.6ordinary shareholders Ordinary dividends (equity) (18.1) (18.1) (32.6) (32.6) Retained (loss)/profit (6.3) (8.1) 7.3 - Earnings per share 5 Basic 3.3p 2.8p 11.0p 9.0p Diluted 3.3p 2.7p 11.0p 9.0p Earnings per share before 5 rebranding costs, amortisation of goodwill and disposals Basic 3.4p 2.9p 11.7p 10.2p Diluted 3.4p 2.9p 11.7p 10.1p Dividend per share 9.0p 9.0p Statement of Total Recognised Gains and Losses For the financial year ended 30th January 2005 2004/5 2003/4 Full Full year year audited audited (restated) Notes ‚£m ‚£m Profit after taxation 46.5 39.2 Currency translation 1.7 9.8adjustments (net of associated tax credit/charge) Total recognised gains for 48.2 49.0the year Prior year adjustment on 10 1.1 adoption of UITF 38 Total recognised gains since 49.3 last Annual Report Consolidated Balance Sheet As at 30th January 2005 30th 1st January February 2005 2004 audited audited Notes ‚£m ‚£m Fixed Assets Intangible assets 44.8 45.9 Tangible assets 98.3 107.2 143.1 153.1 Current Assets Stocks 158.1 151.0 Debtors - due within one 131.4 128.5year - due after more than one 81.9 79.6year Cash at bank and in hand 27.9 31.7 399.3 390.8 Creditors - due within one year Loans and overdrafts (0.8) (2.9) Other (149.0) (156.1) (149.8) (159.0) Net current assets 249.5 231.8 Total assets less current 392.6 384.9liabilities Creditors - due after more than one year Loans (227.8) (230.7) Provisions for liabilities 6 (43.2) (42.1)and charges Net assets 121.6 112.1 Equity shareholders' funds (0.3) (9.7) Non-equity shareholders' 121.9 121.8funds Total shareholders' funds 121.6 112.1 Reconciliation of Movements in Shareholders' Funds For the financial year ended 30th January 2005 2004/5 2003/4 Full Full year year audited audited (restated) ‚£m ‚£m Profit after taxation 46.5 39.2 Dividends - preference (6.6) (6.6) - ordinary (32.6) (32.6) 7.3 - New share capital 0.1 0.9subscribed Purchase of own preference - (2.3)shares Credit in respect of 0.4 -employee share schemes Goodwill reinstated on - 0.4disposal of businesses Currency translation 1.7 9.8adjustments (net of associated tax credit/ charge) Net change in shareholders' 9.5 8.8funds Opening shareholders' funds 112.1 103.3(2003/4: previously ‚£ 103.5m, restated for prior year adjustment of ‚£0.2m to ‚£103.3m) Closing shareholders' funds 121.6 112.1Summarised Consolidated Cash Flow Statement For the fourth quarter and financial year ended 30th January 2005 2004/5 2003/4 2004/5 2003/4 Fourth Fourth Full Full year quarter quarter year audited unaudited unaudited audited (restated) Notes ‚£m ‚£m ‚£m ‚£m Operating profit 17.2 18.0 73.8 69.0 Depreciation and 5.1 3.9 18.6 15.9non-cash items Working capital 7.5 9.5 (19.9) (14.9) Net cash inflow from 7 29.8 31.4 72.5 70.0operating activities Net interest payable (6.6) (6.7) (13.4) (14.0) Preference dividends (3.3) (3.3) (6.6) (6.6) Taxation paid (2.2) (4.5) (12.1) (14.5) Purchase of tangible (3.4) (5.4) (13.3) (20.4)fixed assets Sale of tangible fixed 0.8 1.2 1.0 2.6assets Purchase of business 2 - - (2.6) -(net of costs) Disposal of business - (0.3) - 0.5(net of costs) Ordinary dividends paid - - (32.6) (32.6) Cash inflow/(outflow) 15.1 12.4 (7.1) (15.0)before use of liquid resources and financing Issue of ordinary - - 0.1 0.9shares Purchase of own - - - (2.3)preference shares New bank loans - - 23.0 206.6 Repayment of bank loans (17.7) (13.1) (17.7) (188.7) (Decrease)/increase in (2.6) (0.7) (1.7) 1.5cash Reconciliation of net debt Net debt at beginning (201.9) (209.2)of year (Decrease)/increase in (1.7) 1.5cash Increase in debt (5.3) (17.9) Exchange movement 8.2 23.7 Net debt at end of year 8 (200.7) (201.9)Notes 1 Segment information i) Business segments 2004/5 2003/4 2004/5 Full 2003/4 Fourth Fourth year Full year quarter quarter audited audited unaudited unaudited (restated) ‚£m ‚£m ‚£m ‚£m Turnover Marketing and Distribution Division Americas 67.2 65.0 289.8 286.1 Europe and Asia Pacific 93.9 92.3 390.2 382.1 161.1 157.3 680.0 668.2 Industrial Products Division 23.9 23.2 96.7 96.4 185.0 180.5 776.7 764.6 Operating profit Marketing and Distribution Division Americas - before rebranding costs 6.3 6.2 27.7 27.0 - rebranding costs - - - (1.2) 6.3 6.2 27.7 25.8 Europe and Asia Pacific - before rebranding costs and 10.3 10.7 44.1 40.6 amortisation of goodwill - rebranding costs - - - (1.2) - amortisation of goodwill (0.6) (0.6) (2.6) (2.6) 9.7 10.1 41.5 36.8 Total Marketing and 16.0 16.3 69.2 62.6 Distribution Division Industrial Products Division - before amortisation of 3.2 3.3 13.5 13.7 goodwill - amortisation of goodwill - - (0.1) - Total Industrial Products 3.2 3.3 13.4 13.7 Division Head Office costs (2.0) (1.6) (8.8) (7.3) 17.2 18.0 73.8 69.0 Net operating assets (excluding goodwill) Marketing & Distribution Division Americas 114.6 111.4 Europe and Asia Pacific 155.5 151.6 270.1 263.0 Industrial Products Division 25.7 24.3 295.8 287.3 ii) Geographical segments by origin 2004/5 Full 2003/4 year Full year audited audited (restated) ‚£m ‚£m Turnover Americas 346.4 343.2 UK 267.8 270.6 Rest of World 162.5 150.8 776.7 764.6 Operating profit Americas 39.5 38.8 UK 34.5 31.7 Rest of World 11.3 8.4 Head Office (8.8) (7.3) Amortisation of goodwill (UK: (2.7) (2.6) ‚£2.6m, Americas: ‚£0.1m) 73.8 69.0 Net operating assets Americas 109.4 105.2 UK 133.8 131.4 Rest of World 52.6 50.7Related Shares:
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