13th Jun 2008 07:00
ENSOR HOLDINGS PLC FINAL RESULTS FOR THE YEAR ENDED 31 MARCH 2008 CHAIRMAN'S STATEMENT SALES UP: 4% to ‚£29,437,000 PROFIT BEFORE TAX UP: 19% to ‚£1,668,000 PROPOSED DIVIDEND UP: 10% to 1.2p
I am pleased to present my statement for the year ended 31 March 2008, including a review of our business activities and the prospects for the current year.
Financial Review
These results are now presented under International Financial Reporting Standards and the comparative figures have been restated to reflect the changes, details of which were shown in our IFRS Restatement Report which was published on 12 December 2007.
Group sales for the year were ‚£29,437,000 (2007: ‚£28,277,000), an increase of 4%.
Group operating profit before reorganisation costs improved by 20% to ‚£ 1,966,000 (2007: ‚£1,643,000), a strong increase made possible by generating additional sales from a largely unchanged overhead base.
Reorganisation costs of ‚£150,000 (2007: ‚£nil) arose from a business relocation which was undertaken and completed during the year.
Financial expenses showed a significant reduction to ‚£148,000 (2007: ‚£237,000) as a result of strong cash generation from the Group and good investment performance in the pension fund last year.
After taking account of these costs, profit before tax of ‚£1,668,000 (2007: ‚£ 1,406,000) increased by ‚£262,000.
Group profit for the year after tax of ‚£1,194,000 (2007: ‚£986,000) is equivalent to 4.1p per share (2007: 3.3p), an increase of 24%.
Operating cash flow remained strong at ‚£2,096,000, enabling us to reduce borrowings by ‚£452,000 to ‚£1,206,000, after investing significantly in products and capital assets. Net debt reduced to 10% (2007: 15%) of total equity.
Investment expenditure included ‚£1,083,000 in respect of property, plant and equipment and ‚£314,000 of goodwill in relation to the acquisitions of a tool distributor and a timber treatment operation.
Whilst the level of working capital employed demonstrates our commitment to servicing the ever-increasing demands of customers, we have successfully managed its reduction relative to the increased sales for the year.
I believe these results reflect the continued good progress of the Group's businesses.
Trading
Our building products businesses performed particularly well in the first half of the year and posted an increased operating profit of ‚£1,496,000 for the full year (2007: ‚£1,215,000), making progress in the second half despite weaker market conditions arising from the ongoing turbulence in financial markets and higher euro costs. Gross margins were maintained nevertheless.
The purchase of an alternative site in Cheshire for part of our Brackley-based timber and fencing business enabled us to relocate part of its production function and to extend its service capabilities and geographical reach. We expect the benefits of this expansion to contribute fully in the coming year. Costs of ‚£150,000 were charged during the year in respect of the relocation.
The market position of our roofing tools and ancillaries business was strengthened by the acquisition and integration of the business of a small competitor.
The Group's other building products businesses, encompassing construction materials and industrial doors, increased sales and profitability year on year.
Our specialist packaging materials business continued to grow, achieving exceptionally strong results throughout the year and generating an operating profit of ‚£321,000 (2007: ‚£257,000).
The rubber processing and general electric motor companies experienced a difficult but successful year. Sales reduced slightly to ‚£2,336,000 (2007: ‚£ 2,439,000) as greater emphasis was placed on higher-margin and lower-risk business. Although the trading profits were enhanced as a result, one-off lease provisions left operating profits a little lower at ‚£149,000 (‚£2007: ‚£171,000).
Prospects
Although market conditions are presently more difficult than at this time last year, new facilities, newly introduced products and product improvements provide opportunities to counter the impact of general economic uncertainty. We are therefore cautiously optimistic for the Group's prospects for the current year.
We are financially well placed to take advantage of appropriate acquisition opportunities to strengthen the Group.
Dividend
Having considered the strength of our results and balance sheet and the outlook for the coming year, the Board proposes to pay a final dividend of 0.78p per share (2007: 0.70p), increased by 11% over the previous year.
This dividend, together with the interim dividend of 0.42p already paid, would result in total dividends for the year of 1.20p per share (2007: 1.09p).
Subject to approval at the Annual General Meeting, the final dividend will be paid on 8 August 2008 to shareholders on the register on 27 June 2008.
Employees
Once again, on your behalf, I would like to extend my thanks to the staff of the Ensor Group companies for their hard work and skill, which continues to generate these results.
K A Harrison TDChairman13 June 2008
Audited Consolidated Income Statement
for the year ended 31 March 2008
2008 2007 ‚£'000 ‚£'000 Revenue 29,437 28,277 Cost of sales (20,049) (19,377) ______ ______ Gross profit 9,388 8,900 Distribution costs (1,584) (1,503) Administrative expenses (5,838) (5,754) ______ ______ Operating profit 1,966 1,643 Reorganisation costs (150) - Financial expenses (148) (237) ______ ______ Profit before tax 1,668 1,406 Income tax expense (474) (420) ______ ______ Profit for the year attributable to equity 1,194 986shareholders ______ ______ Earnings per share Basic 4.1p 3.3p Fully diluted 3.9p 3.3p ______ ______ Dividends per share Interim dividend paid 0.420p 0.390p Final dividend proposed 0.780p 0.700p ______ ______ 1.200p 1.090p ______ ______
Audited Consolidated Balance Sheet
at 31 March 2008 2008 2007 ‚£'000 ‚£'000 ASSETS Non-current assets Property, plant & equipment 5,969 5,496 Intangible assets 3,147 2,833 ______ ______ Total non-current assets 9,116 8,329 ______ ______ Current assets Inventories 4,415 4,392 Trade and other receivables 5,641 6,047 ______ ______ Total current assets 10,056 10,439 ______ ______ Total assets 19,172 18,768 ______ ______ LIABILITIES Non-current liabilities Retirement benefit obligations 572 1,033 Deferred tax 117 97 ______ ______ Total non-current liabilities 689 1,130 ______ ______ Current liabilities Cash and cash equivalents 1,206 1,604 Interest bearing loans - 54 Trade and other payables 5,225 5,155 ______ ______ Total current liabilities 6,431 6,813 ______ ______ Total liabilities 7,120 7,943 ______ ______ NET ASSETS 12,052 10,825 ______ ______ EQUITY Share capital 2,945 2,945 Share premium 470 470 Revaluation reserve 871 871 Retained earnings 7,766 6,539 ______ ______ Total equity attributable to equity shareholders 12,052 10,825 ______ ______Other Audited Statements
for the year ended 31 March 2008
Consolidated Statement of Recognised Income and Expense (SORIE)
2008 2007 ‚£'000 ‚£'000 Profit for the financial year 1,194 986 Actuarial gain 518 743 Related deferred tax (155) (222) ______ ______
Total recognised income and expense for the financial 1,557 1,507 period
______ ______
Consolidated Statement of Changes in Shareholders' Equity
2008 2007 ‚£'000 ‚£'000 Opening shareholders' equity at 1 April 2007 10,825 9,613 Recognised income and expenditure for the financial 1,557 1,507period Issue of new shares - 4 Dividends paid (330) (299) ______ ______ Closing shareholders' equity at 31 March 2008 12,052 10,825 ______ ______
Audited Consolidated Cash Flow Statement
for the year ended 31 March 2008
2008 2007 ‚£'000 ‚£'000 Cash flows from operating activities
Profit for the year attributable to equity shareholders 1,194 986
Depreciation charge 499 492 Finance expense 148 237 Income tax expense 474 420 Profit on disposal of property, plant & equipment (35) (3) _______ _______
Operating cash flow before changes in working capital 2,280 2,132
Decrease/(increase) in inventories 24 (23) Decrease/(increase) in receivables 406 (279) (Decrease)/increase in payables (90) 267 _______ _______ Cash generated from operations 2,620 2,097 Interest paid (156) (196) Income taxes paid (368) (282) _______ _______ Net cash generated from operating activities 2,096 1,619 _______ _______ Cash flows from investing activities Proceeds from sale of property, plant and equipment 146 82 Acquisition of property, plant and equipment (501) (401) Acquisition of going concern (818) - _______ _______ Net cash absorbed by investing activities (1,173) (319) _______ _______ Cash flows from financing activities Issue of ordinary share capital - 4 Repayment of loans (50) (200) Capital element of finance lease payments (4) (12) Equity dividends paid (330) (299)
Contribution to pension scheme in excess of charge to (141) (148) income
_______ _______ Net cash absorbed by financing activities (525) (655) _______ _______ Net increase in cash and equivalents 398 645 Opening cash and cash equivalents (1,604) (2,249) _______ _______ Closing cash and cash equivalents (1,206) (1,604) _______ _______NOTES 1. Accounting policies Basis of preparation
The consolidated financial statements of Ensor Holdings PLC have been prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and as applied in accordance with the provisions of the Companies Act 1985 for the first time. The Group financial statements have been prepared under the historical cost convention, with the exception of the Group's properties which have been stated at deemed cost in accordance with the transition requirements of IFRS.
IFRS transitional arrangements
Ensor Holdings PLC reported under UK GAAP in its previous financial statements for the year ended 31 March 2007. A reconciliation of profits as reported under UK GAAP for the year ended 31 March 2007, to the revised profit and net assets reported under IFRS at that date was provided in the company's interim announcement issued in December 2007. Copies of the interim statement are available on the company's website.
Basis of consolidation
Where the Company has the power, either directly or indirectly, to govern the financial and operating policies of another entity so as to obtain benefits from its activities, the entity is classified as a subsidiary. The consolidated financial statements present the results of the Company and its subsidiaries (The Group) as if they formed one single entity. Intercompany transactions and balances between Group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the consolidated balance sheet, the subsidiary's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the consolidated income statement from the date on which control is obtained.
2. Earnings per share
The calculation of earnings per share is based upon the profit after taxation of ‚£1,194,000 (2007: ‚£986,000) divided by the weighted average number of ordinary shares in issue during the year, 29,445,659 (2007: 29,434,906). The fully diluted earnings per share are based upon the weighted average of 30,305,708 shares (2007: 30,069,823). The dilution in both years is due to subsisting share options.
3. Analysis of changes in net debt
At At 31 March 31 March 2007 Cashflows 2008 ‚£'000 ‚£'000 ‚£'000 Bank overdraft (1,604) 398 (1,206) Bank loans (50) 50 - Finance leases (4) 4 - ______ ______ ______ (1,658) 452 (1,206) ______ ______ ______
4. Reconciliation of net cash flow to movement in net debt
2008 2007 ‚£'000 ‚£'000 Increase in cash in the year 398 645 Cash outflow from repayment of debt 54 212 ______ ______ Movement in net debt arising from cash flow 452 857 Net debt at 1 April 2007 (1,658) (2,515) ______ ______ Net debt at 31 March 2008 (1,206) (1,658) ______ ______ 5. Basis of preparation
The financial information set out in this preliminary announcement of results does not constitute the Company's statutory accounts for the years ended 31 March 2008 or 31 March 2007 but is derived from those accounts. Statutory accounts for 2007 have been delivered to the Registrar and those for 2008 will be delivered following the Company's Annual General Meeting. The Independent Auditors have reported on these accounts. Their reports were unqualified and did not contain statements under section 237(2) or (2) of the Companies Act 1985.
6. Other information
The Annual General Meeting of the Company will be held at the Company's registered office, Ellard House, Dallimore Road, Manchester M23 9NX at 10.30 a.m. on Tuesday 5 August 2008.
The Report and Accounts will be posted to shareholders and be available from the Company's website at www.ensor.co.uk shortly. Additional copies of the Annual Report and of this statement will be available at the Company's registered office.
Enquiries:Ensor Holdings PLCPaul Parnham/Marcus Chadwick0161 945 5953Hanson Westhouse LimitedTim Feather/Matthew Johnson
0113 246 2610
vendorRelated Shares:
ESR.L