29th Nov 2007 07:01
Avon Rubber PLC29 November 2007 Strictly embargoed until 07:00 29 November 2007 Avon Rubber p.l.c. Preliminary results for the year ended 30 September 2007 30 Sept 30 Sept 2007 2006 £Millions £Millions-------------------------------------------------------------------------------- CONTINUING OPERATIONS Revenue 66.7 63.1 Operating profit/(loss) before exceptional items 1.2 (0.1) Operating profit after exceptional items 1.2 2.5 Profit/(loss) for the year 2.2 (0.8) PROFIT/(LOSS) FOR THE YEAR 1.1 (19.1) EARNINGS/(LOSS) PER SHARE Basic 3.9p (68.9)p Continuing operations 7.9p (2.1)p Diluted 3.8p (68.9)p DIVIDENDS PER SHARE 8.5p 8.5p - Dividend maintained- Full rate production decision reached by DoD for the new JSGPM respirator- US approval for Viking Z Seven product- Engineered Fabrications performed extremely well- Dairy business delivered an improved performance- Planned exit from mixing facility Commenting on the results, Terry Stead, Chief Executive said: "Since the interimannouncement, the Group has reached a number of significant milestones. Thesecond half of 2007 has shown improvement over the first half. With the approvalof the new product at Avon-ISI and once the full rate production starts at ourCadillac facility, we expect this to continue. The Board is confident that this,together with continued investment in new product development, will lead to aperiod of sustainable and profitable growth for the Group." For further enquiries, please contact: Avon Rubber p.l.cTerry Stead, Chief Executive 020 7067 0700Peter Slabbert, Group Finance Director (until 2.00pm) From 30 November: 01225 896 831Fiona Stewart, Corporate Communications Executive 01225 896 871 Weber Shandwick FinancialRichard Hews 020 7067 0700Rachel MartinHannah Marwood An analyst meeting will be held at 09:15 for 09:30 am this morning at the offices of Weber Shandwick Financial, Fox Court, 14 Gray's Inn Road, London, WC1X 8WS NOTES TO EDITORS: Avon Rubber p.l.c. is an international polymer engineeringgroup adding value through material, manufacturing and industry sectorexpertise. The Group is currently capitalised at approximately £47 million.Avon supplies a range of advanced CBRN respiratory protection solutions throughAvon Protection Systems Inc. to the world's military and police forces, as wellas first responders and emergency services. Avon Rubber p.l.c. owns Avon-ISI,which designs, develops and manufactures a range of SCBA equipment for fire,rescue and law enforcement, as well as military applications. Avon Rubber p.l.c.also owns Avon Engineered Fabrications manufacturing products includinghovercraft skirting and flexible storage tanks, an aerosol gasket business and aworld leading dairy business manufacturing dairy liners and tubing. AVON RUBBER p.l.c. PRELIMINARY RESULTS FOR THE YEAR ENDED 30 SEPTEMBER 2007 INTRODUCTION The Group has made significant progress this year following our majorrestructuring in 2006, including the exit from the Automotive market anddecision to focus on our chosen Protection and Defence and Dairy markets. Inparticular, the full rate production (FRP) decision has been made by our majorcustomer, the US Department of Defence (DoD), for the new Joint Service GeneralPurpose Mask (JSGPM) military respirator. This will generate sustainable longterm revenue for the Group. Whilst we have yet to realise the full financialbenefits of these changes the Group has returned to profit in the year with aprofit for the year from continuing operations of £2.2 million (2006: £0.8million loss) and the Board is recommending an unchanged dividend. The Engineered Fabrications operation performed well during the year and weexperienced strong demand for our legacy respirators manufactured in the UK. Wehave also made considerable progress on the JSGPM contract. Importantly the FRPdecision was made in September, allowing the DoD to exercise this portion of itscontract with us and commence full rate production under the new designationM50. Introduction to service is expected before the end of the calendar year.The first multi- year order is planned at a rate of 100,000 masks per annum foran initial contract period of five years with additional orders for both masksand spares to follow. It is anticipated that orders in the first year willexceed $40 million. Less positively, the UK police did not take expectedquantities of our new EH20 emergency hood, the fire market for our selfcontained breathing apparatus (SCBA) products was weak in the US and weexperienced significant production start up delays and costs in the new Cadillacfacility. The Dairy business performed strongly particularly in the European market. Theprofit and cash generated from this business continues to underpin our plans forProtection and Defence. The losses in our other operations remain a concern andwith the plans to eliminate losses at our UK Mixing facility provingunsuccessful, we have committed to the sale of this entity at the earliestopportunity. If a solution cannot be reached we will close this facility. RESULTS Revenue on continuing business increased by £3.6 million (5.7%) to £66.7 millionfrom £63.1 million in 2006. The first half year is up 2.4% on the correspondingperiod last year and the second half year, 9.6% higher than the previous year.We delivered an operating profit on continuing business of £1.2 million (2006:£0.1 million loss before exceptional items) in the year. The second half profitof £1.3 million improved on the £0.1 million loss in the first half year and the£1.5 million loss in the second half of 2006. Net interest costs reduced to £0.8 million (2006: £3.4 million) on lower averagenet debt levels following the disposal of Automotive in August 2006. The financecredit arising from the accounting for pensions increased by £0.3 million to£2.5 million (2006: £2.2 million) with a lower UK pension scheme deficit at thestart of the year and lower US retirement obligations with the reduced USworkforce. This pension credit will reduce in 2008 with changed actuarialassumptions. This resulted in a profit before tax on continuing business of £2.9million (2006: £1.2 million) and a profit after tax of £2.2 million (2006: £0.8million loss). The loss on discontinued business was £1.1 million (2006: £18.3million) giving a Group profit for the year of £1.1 million (2006: £19.1 millionloss). The earnings per share on continuing operations was 7.9p (2006: 2.1p loss). Net debt increased from £1.1 million at the 2006 year end to £10.4 million at 30September 2007. Cash outflows in the first half held over from the sale of theAutomotive business, the sale of our UK property and restructuring charges - allreflected in the 2006 report and accounts - amounted to £3.4 million. Capitalinvestment remained high at £5.3 million (2006: £14.8 million) primarilyrelating to fixed assets in the Cadillac facility and the development of ourfilter and respiratory protection product range. We will continue to invest inorder to access additional markets with a more comprehensive product range. Thisinvestment will be at a lower rate in the future with the focus being on productdevelopment rather than capital equipment. Existing facilities are well equippedwith sufficient capacity to meet short term growth targets. Working capital increased in the year due to both the increased level ofbusiness and the delay in year end low rate initial production (LRIP)deliveries. Following the disposal of Automotive in 2006, the Group has amended the primarysegmental analysis to reflect the remaining business sectors of Protection andDefence, Dairy and Other Engineered Products. PROTECTION AND DEFENCE The Protection and Defence segment includes our respiratory protectionbusinesses in the US and UK together with our US based fabrications operation,representing in total 57% of Group revenues. Revenue of £37.8 million (2006:£32.4 million) grew by 17%. A loss of £1.0 million (2006: £0.2 million) wasincurred although the reduced loss of £0.2 million in the second half of theyear (2006: £1.1 million) was an improvement compared with the first half lossof £0.8 million (2006: £0.9 million profit). Revenue growth was achieved in the fabrications business where military demandfor our Nitrile tank products increased. This has resulted in improvedprofitability at this operation. We are optimistic that this trend will continueand that profitable long term revenue streams will be secured from theseproducts although the risks associated with long term contracts, most notablythe unpredictability of contract start dates, may increase. The new Cadillac facility supplied the initial LRIP order of M50 militaryrespirators and further follow-on orders from the DoD for the M53 derivative aswell as some commercial sales of the C50 variant for which we obtained NationalInstitute of Occupational Safety and Health (NIOSH) and CE approval. Productionof the follow-on LRIP order was achieved to schedule in the second half year butdeliveries were deferred until after the year end pending completion of finalproduction testing. One of the purposes of LRIP orders prior to the long termproduction order is to test and prove the product design and productioncapability in a normal production environment. Successful completion of this ledto the FRP decision being made by the DoD in September. Achieving this requiredgreater than expected resources, particularly in the first quarter of thefinancial year. We did, however, make rapid progress during the second quartertowards achieving targeted manufacturing process efficiencies and productioncosts in the second half year were significantly lower. The consistent demand ofthe multi-year contract together with an increase in volumes will drive furtherefficiency improvements in 2008. Our UK Protection operation was profitable despite the UK government not meetingits expected volume commitments for the newly introduced emergency hood.Discussions to resolve this continue. These shortfalls were offset by continuingdemand for our existing S10 and FM12 products, particularly from the MOD and UKpolice. A memorandum of understanding entered into for the provision ofrespirators to the Turkish armed forces may well extend the life of theseproducts significantly. Challenging market conditions existed for much of the year for ISI whichsupplies SCBA to the fire services market in the US. Delays in the release ofFederal grants throughout the 2006 calendar year and the introduction of newregulatory standards in September 2007 led to delays in procurement decisions. In addition, approval for our Viking Z Seven product was only obtained inOctober 2007 which left us (and most of the competition) without approvedproduct to sell in September. With the standard now in place and our producthaving achieved National Fire Protection Association (NFPA) certification, weexpect demand at ISI to improve. DAIRY Our Dairy business delivered an improved performance this year despite theeffect of a weaker dollar. Revenue was unchanged at £19.1 million with thenegative effect of the weaker US dollar on revenues from our US businessoffsetting growth in the European operation. Operating profit increased to £3.0million (2006: £1.6 million) with the revenue growth in Europe coming primarilyfrom our higher margin own brand Milk-Rite products. This business alsobenefited from the lower cost base in our Hampton Park West facility followingthe restructuring last year. The consistent and improved delivery from thisbusiness reflects continued rigorous cost control and innovative product andmarketing developments. OTHER ENGINEERED PRODUCTS This segment includes our aerosol gasket business and the remaining businessmachines products. The mixing operation is shown as assets held for sale and itsresults have been treated as discontinued. Revenue reduced to £9.8 million(2006: £11.6 million) with the significantly weaker US dollar slowing plannedgrowth in sales of aerosol gaskets from our UK manufacturing base. Our remainingcontract for business machines products ended in September 2007 with salesreducing in the second half in the run up to its termination. We will not bepursuing further activity in this market in line with our strategy ofconcentrating on our core businesses. The losses incurred reduced to £0.7million (2006: £1.5 million) due to cost reductions. We will continue to seekstrategies to eliminate losses in this area of business. DIVIDENDS The Board is recommending an unchanged final dividend of 4.8p per share payableon 4 February 2008 to holders of ordinary shares on the register at the close ofbusiness on 11 January 2008. With an interim dividend of 3.7p (2006: 3.7p), thetotal dividend is unchanged at 8.5p per share. The Board recognises that thedividend is not fully covered by current earnings but continues to believe thatprogress in current trading and opportunities available to the Group will leadto the restoration of adequate levels of cover in due course. PENSIONS After a number of years of final salary scheme pension deficits, highlighted bythe requirement to account for these deficits on company balance sheets, it isespecially pleasing to record the positive results of actions taken by the Grouptogether with the Trustees of our schemes and market improvements. The netfinancial position of our retirement benefit obligations as measured underInternational Accounting Standard 19 Employee Benefits (IAS 19) had improved atthe half year with the deficit reducing to £7.7 million from £14.6 million atSeptember 2006, and this improvement has continued resulting in a surplus of£14.7 million at 30 September 2007. The triennial valuation of the UK fund on 1April 2006 was also agreed during the financial year with improved asset returnstogether with the effects of recent actions leading to a fund surplus of £2.4million (2003 valuation £45.4 million deficit) despite more prudent mortalityassumptions. The Group will continue to work closely with the Trustees of thefund to manage this risk. BOARD CHANGES As the Group makes its transition to be focused on the Protection and Defenceand Dairy markets, the Board has felt the need to alter its composition toreflect these changes. In particular we have sought independent directors withexperience of operating in defence and related markets. In January Sir Richard Needham was appointed as Chairman. Sir Richard wasNorthern Ireland Economy Minister for three years and UK Minister for Trade fora further three years. He was International Director for GEC Marconi for twoyears and a Non-Executive Director with Meggitt plc for five years. Hisexperience is proving invaluable in supporting the changing Group. In addition David Evans was appointed as a Non-Executive Director with effectfrom 1 June 2007. David is a Non-Executive Director of Chemring Group PLC,having previously been their Chief Executive during a period of significantgrowth. Earlier in his career he spent seventeen years with GEC-Marconi in thedefence industry and has been a member of the Executive Committee of the DefenceManufacturers' Association for the last nine years. Brian Duckworth, having completed his full five year appointed term asNon-Executive Director and latterly as Senior Independent Director and Chairmanof the Remuneration Committee, steps down from the Board on 30 November 2007.His experience and contribution will be missed. OUTLOOK Since the interim announcement, the Group has reached a number of significantmilestones. In October 2007 we announced the FRP decision on our new military respirator bythe US DoD. We also announced that we had received NFPA certification for ournew SCBA product manufactured at Avon-ISI in Georgia. We further announced that,in the event we are unable to sell the Mixing facility, it will be closed. The new range of military respirators for the US armed forces, together with theassociated filters, is now in full production at Cadillac, Michigan. We expectthe multi-year contract at an annual rate of 100,000 to be confirmed shortlywith deliveries commencing in our second quarter, followed by additionalrequirement orders. At Avon-ISI we are seeing enquiries increasing for our NFPAapproved product and expect this to lead to increased demand. We are continuingto develop exciting new products and are exploring new market opportunities tosecure the long-term future. Our Dairy business continues to perform strongly. Avon Hi-Life in Wisconsin, UShad another good year and we have seen significant improvements in our EuropeanDairy business. We expect both of these businesses to continue to perform atthese levels. The second half of 2007 has shown improvement over the first half. With theapproval of the new product at Avon-ISI and once the full rate production startsat our Cadillac facility, we expect this to continue. The Board is confidentthat this, together with continued investment in new product development, willlead to a period of sustainable and profitable growth for the Group. CONSOLIDATED INCOME STATEMENT Note Year to Year to 30 Sept 07 30 Sept 06 (unaudited) (unaudited) £'000 £'000 --------------------------------------------------------------------------------Continuing operationsRevenue 2 66,715 63,112Operating profit from continuing operations 2 1,238 2,466-------------------------------------------------------------------------------- --------------------------------------------------------------------------------Operating profit is analysed as:Before exceptional items 1,238 (79)Exceptional operating items - 2,545-------------------------------------------------------------------------------- --------------------------------------------------------------------------------Interest receivable 114 123Interest payable (915) (3,493)Other finance income 2,489 2,151--------------------------------------------------------------------------------Profit before tax 2,926 1,247Taxation 3 (717) (2,045)--------------------------------------------------------------------------------Profit/(loss) for the year from continuing operations 2,209 (798) Discontinued operations(Loss) for the year from discontinued operations 4 (1,114) (18,329)--------------------------------------------------------------------------------Profit/(loss) for the year 1,095 (19,127)-------------------------------------------------------------------------------- Profit/(loss) attributable to minority interest 1 (209)Profit/(loss) attributable to equity shareholders 1,094 (18,918)-------------------------------------------------------------------------------- 1,095 (19,127)-------------------------------------------------------------------------------- Earnings/(loss) per share 6Basic 3.9p (68.9)pDiluted 3.8p (68.9)p Earnings/(loss) per share from continuing operationsBasic 7.9p (2.1)pDiluted 7.7p (2.1)p CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSE Year to Year to 30 Sept 07 30 Sept 06 (unaudited) (unaudited) £'000 £'000--------------------------------------------------------------------------------Profit/(loss) for the financial year 1,095 (19,127)--------------------------------------------------------------------------------Actuarial gain/(loss)recognised in retirement benefit schemes 26,187 (2,075)Movement on deferred tax relating to retirement benefit liabilities (4,606) 115Net exchange differences offset in reserves (2,441) (809)--------------------------------------------------------------------------------Net gains/(losses) not recognised in income statement 19,140 (2,769)--------------------------------------------------------------------------------Total recognised income/(expense) for the year 20,235 (21,896)--------------------------------------------------------------------------------Attributable to:Equity shareholders 20,234 (21,687)Minority interest 1 (209)--------------------------------------------------------------------------------Total recognised income/(expense) for the year 20,235 (21,896)-------------------------------------------------------------------------------- --------------------------------------------------------------------------------Adoption of IAS39 attributable to:Equity shareholders - (12)Minority interests - --------------------------------------------------------------------------------- - (12)-------------------------------------------------------------------------------- CONSOLIDATED BALANCE SHEET Note As at As at 30 Sept 07 30 Sept 06 (unaudited) (unaudited) £'000 £'000--------------------------------------------------------------------------------AssetsNon-current assetsIntangible assets 17,305 17,054Property, plant and equipment 20,041 20,864Deferred tax assets 334 1,101Retirement benefit assets 16,380 --------------------------------------------------------------------------------- 54,060 39,019--------------------------------------------------------------------------------Current assetsInventories 11,526 11,257Trade and other receivables 12,773 15,530Cash and cash equivalents 957 6,893-------------------------------------------------------------------------------- 25,256 33,680Assets classified as held for sale 2,173 --------------------------------------------------------------------------------- 27,429 33,680--------------------------------------------------------------------------------LiabilitiesCurrent liabilitiesFinancial liabilities - borrowings 11,393 8,000Trade and other payables 13,906 18,505Deferred tax liabilities 265 -Current tax liabilities 744 736-------------------------------------------------------------------------------- 26,308 27,241Liabilities directly associated with assets classifiedas held for sale 1,707 --------------------------------------------------------------------------------- 28,015 27,241--------------------------------------------------------------------------------Net current (liabilities)/ assets (586) 6,439--------------------------------------------------------------------------------Non-current liabilitiesDeferred tax liabilities 6,251 2,293Other non-current liabilities - 1,071Retirement benefit obligations 1,730 14,598Provisions 2,037 3,426-------------------------------------------------------------------------------- 10,018 21,388-------------------------------------------------------------------------------- Net assets 43,456 24,070-------------------------------------------------------------------------------- Shareholders' equityOrdinary shares 29,125 28,275Share premium account 34,707 34,191Capital redemption reserve 500 500Translation reserve (2,644) (203)Profit and loss account (18,789) (39,249)--------------------------------------------------------------------------------Equity shareholders' funds 7 42,899 23,514Minority interests (equity interests) 557 556--------------------------------------------------------------------------------Total equity 43,456 24,070-------------------------------------------------------------------------------- CONSOLIDATED CASH FLOW STATEMENT Note Year to Year to 30 Sept 07 30 Sept 06 (unaudited) (unaudited) £'000 £'000--------------------------------------------------------------------------------Cash flows from operating activities Cash (used in)/generated from operations 8 (1,894) 7,835Interest received 114 123Interest paid (896) (3,890)Tax paid (438) (1,679)--------------------------------------------------------------------------------Net cash (used in)/from operating activities (3,114) 2,389--------------------------------------------------------------------------------Cash flows from investing activities Proceeds from sale of subsidiaries (less cash transferred) - 51,972Proceeds from sale of property, plant and equipment 14 12,970Purchase of property, plant and equipment (2,874) (8,963)Purchase of intangible assets (2,445) (5,791)--------------------------------------------------------------------------------Net cash (used in)/from investing activities (5,305) 50,188--------------------------------------------------------------------------------Cash flows from financing activities Net proceeds from issues of ordinary share capital 1,441 275Net movements in loans and finance leases (2,488) (51,264)Decrease in derivatives - 24Dividends paid to shareholders (2,353) (2,332)--------------------------------------------------------------------------------Net cash used in financing activities (3,400) (53,297)--------------------------------------------------------------------------------Effects of exchange rate changes (111) (89)--------------------------------------------------------------------------------Net decrease in cash and cash equivalents (11,930) (809)Cash and cash equivalents at beginning of the year 6,893 7,702--------------------------------------------------------------------------------Cash and cash equivalents at end of the year 9 (5,037) 6,893-------------------------------------------------------------------------------- NOTES TO THE PRELIMINARY FINANCIAL STATEMENTS 1. Basis of preparation FINANCIAL REPORTING (a) The figures and financial information for the year ended 30 September 2007 do not constitute the statutory financial statements for that year. Those financial statements have not yet been delivered to the Registrar, nor have the auditors reported on them. (b) The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards and International Financial Reporting Interpretations Committee (IFRIC) interpretations as adopted by the European Union (collectively "IFRS") and with those parts of the Companies Act 1985 applicable to companies reporting under IFRS. (c) As permitted IFRIC 14, "IAS 19 - The limit on a defined benefit asset, minimum funding requirements and their interaction" has been adopted early. 2. Segmental analysis Due to the differing natures of the products and their markets, Avon Rubberp.l.c.'s primary reporting segment is by business. The secondary reportingformat comprises the geographical segments by origin. Year to Year to 30 Sept 07 30 Sept 06 £'000 £'000--------------------------------------------------------------------------------Revenue by business sectorProtection and Defence 37,838 32,438Dairy 19,071 19,116Other Engineered Products 9,806 11,558-------------------------------------------------------------------------------- 66,715 63,112--------------------------------------------------------------------------------Operating profit/(loss) by business sectorProtection and Defence (1,037) (189)Dairy 2,975 1,619Other Engineered Products (700) (1,509)-------------------------------------------------------------------------------- 1,238 (79)--------------------------------------------------------------------------------Exceptional operating itemsProtection and Defence - 896Dairy - 789Other Engineered Products - 860-------------------------------------------------------------------------------- - 2,545--------------------------------------------------------------------------------Total operating profit from continuing operations 1,238 2,466---------------------------------------------------------------------------------------------------------------------------------------------------------------- Revenue by originEurope 23,351 20,336North America 43,364 42,776-------------------------------------------------------------------------------- 66,715 63,112-------------------------------------------------------------------------------- 3. Taxation The split of the tax charge/(credit) between UK and overseas is as follows: Year to Year to Year to Year to 30 Sept 07 30 Sept 06 30 Sept 06 30 Sept 06 Total Continuing Discontinued Total £'000 £'000 £'000 £'000--------------------------------------------------------------------------------United Kingdom 88 1,011 (634) 377Overseas 629 1,034 52 1,086-------------------------------------------------------------------------------- 717 2,045 (582) 1,463-------------------------------------------------------------------------------- 4. Results from discontinued operations Year to Year to 30 Sept 07 30 Sept 06 £'000 £'000--------------------------------------------------------------------------------Revenue 7,006 167,644 Operating loss from discontinued operations (1,114) (885) --------------------------------------------------------------------------------Operating loss is analysed as:Before exceptional items (1,114) 3,041Exceptional operating items - (3,926)--------------------------------------------------------------------------------Taxation on profits from discontinued operations - 582Loss on disposal - (18,026)--------------------------------------------------------------------------------Loss for the year from discontinued operations (1,114) (18,329)-------------------------------------------------------------------------------- The discontinued operations consist of the UK Mixing operation which was beingactively marketed for sale at the year end and additionally, in 2006, thedisposed Automotive components and business machine businesses. 5. Dividends The directors are proposing a final dividend in respect of the year ending 30September 2007 of 4.8p which will absorb an estimated £1,325,000 ofshareholders' funds. The dividend will be paid on 4 February 2008 toshareholders on the register at noon on 11 January 2008. In accordance with IFRS the proposed final dividend is not recorded as aliability nor reflected in the income statement. 6. Earnings per share Basic earnings per share is based on a profit attributable to ordinaryshareholders of £1,094,000 (2006: £18,918,000 loss) and 27,885,127 (2006:27,454,995) ordinary shares, being the weighted average of the shares in issueduring the period on which dividends are paid. Earnings per share on continuing operations is based on a profit of £2,208,000(2006: £589,000 loss). The company has dilutive potential ordinary shares in respect of the SharesaveOption Scheme and Performance Share Plan. The diluted earnings per share isbased on a profit of £1,094,000 and 28,727,000 ordinary shares being theweighted average of the shares in issue during the year adjusted to assumeconversion of all dilutive potential ordinary shares. 7. Reconciliation of changes in equity Year to Year to 30 Sept 07 30 Sept 06 £'000 £'000--------------------------------------------------------------------------------At the beginning of the year 23,514 46,934Profit/(loss) for the period attributable to equity shareholders 1,094 (18,918)Dividends (2,353) (2,331)Actuarial gain/(loss) recognised in retirement benefit schemes 26,187 (2,075)Movement on deferred tax relating to retirement benefit liabilities (4,606) 115Net exchange differences offset in reserves (2,441) (809)New share capital subscribed 1,366 275Movement in respect of employee share scheme 138 323--------------------------------------------------------------------------------At the end of the year 42,899 23,514-------------------------------------------------------------------------------- 8. Cash generated from operations Year to 30 Year to 30 Sept 07 Sept 06 £'000 £'000--------------------------------------------------------------------------------Continuing operationsProfit/(loss) for the financial year 2,209 (798)Adjustments for:Tax 717 2,045Depreciation 2,142 1,356Impairment of fixed assets 250 433Amortisation and impairment of intangibles 1,054 1,132Net interest expense 801 3,370Other finance income (2,489) (2,151)Profit on disposal of property, plant and equipment - (4,391)Movements in working capital and provisions (5,663) (2,480)Other movements (245) (417)--------------------------------------------------------------------------------Cash used in continuing operations (1,224) (1,901)--------------------------------------------------------------------------------Discontinued operations(Loss)/profit for the financial year (1,114) (18,329)Adjustments for:Tax - (582)Depreciation 41 5,494Impairment of fixed assets - 3,009Loss on sale of subsidiaries - 18,026Amortisation and impairment of intangibles - 1,128Movements in working capital and provisions 403 431Other movements - 559--------------------------------------------------------------------------------Cash (used in)/generated from discontinued operations (670) 9,736--------------------------------------------------------------------------------Cash (used in)/generated from operations (1,894) 7,835-------------------------------------------------------------------------------- 9. Analysis of net debt As at Cash Exchange As at 30 Sep 06 Flow movements 30 Sep 07 £'000 £'000 £'000 £'000--------------------------------------------------------------------------------Cash at bank and in hand 1,823 (957) (75) 791Overdrafts - (6,019) 25 (5,994)--------------------------------------------------------------------------------Current asset investments classified as cash equivalents 5,070 (4,843) (61) 166--------------------------------------------------------------------------------Cash and cash equivalents 6,893 (11,819) (111) (5,037)Debt due within 1 year (8,000) 2,488 113 (5,399)-------------------------------------------------------------------------------- (1,107) (9,331) 2 (10,436)-------------------------------------------------------------------------------- The net debt above can be reconciled to the balance sheet as follows: cash andcash equivalents shown on the balance sheet comprise cash at bank and in handplus current assets classified as cash equivalents. Borrowings shown on thebalance sheet comprise overdrafts and debt due within one year. Borrowing facilities Total facility Utilised Undrawn(expiring within one year) £'000 £'000 £'000--------------------------------------------------------------------------------United Kingdom 14,000 9,820 4,180North America 2,086 877 1,209Utilised in respect of guarantees 368 368 --------------------------------------------------------------------------------- 16,454 11,065 5,389-------------------------------------------------------------------------------- Facilities expiring within one year have been renegotiated subsequent to theyear end with commitment periods extended to 31 March 2009. 10. Copies of the directors' report and the audited financial statements for the year ended 30 September 2007 will be posted to shareholders and may also beobtained from the company's registered office at Hampton Park West, Semington Road, Melksham, Wiltshire. SN12 6NB, England. (Telephone +44 1225 896871), or via the corporate website (www.avon-rubber.com). This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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