14th Jun 2007 10:38
Northern Bear Plc14 June 2007 14 June 2007 Northern Bear plc ("Northern Bear" or "the Company") Preliminary Results for the period ended 31 March 2007 Northern Bear plc announces preliminary results for the period to 31 March 2007. The group reports a turnover of £4.75 million and an adjusted* operating profitof £440,000. Financial highlights •Group Turnover of £4.75 million •Loss before tax of £65,000 •Adjusted* operating profit of £440,000 •Loss per share of 3.9p * Adjusted operating profit is arrived at after adding back goodwillamortisation, depreciation, share based payments and pre-flotation expenses. Jon Pither, Chairman of Northern Bear, commented: "We are committed to progressively increasing earnings per share by selectiveacquisition and organic development. Growth for growth's sake is not ourobjective. It is encouraging that the gathering scale and momentum of NorthernBear is attracting more potential acquisitions of suitable size and performance.We expect the period ahead to be extremely busy. The current year has got off toa very satisfactory start." Enquiries please contact: Northern Bear PlcGraham Forrest, Chief Executive0191 371 2934 Strand Partners LimitedJames Harris / Braden Saunders020 7409 3494 Chairman's Statement I am delighted to present the first set of results for the group following oursuccessful flotation on AIM in December 2006. Results for the period to 31 March 2007 show turnover of £4,751,000 andoperating profit of £105,000 after goodwill amortisation of £148,000. The Model The business model of bringing mature, cash generative, profitable North Eastbased building services businesses into a group has proved successful. Our existing businesses continue to trade in line with expectations and ouracquisition strategy is proving to be highly effective. The Board We continue to strengthen our board, particularly at the executive level.Joining me as Chairman and Graham Forrest, as Chief Executive Officer, are KeithSoulsby and Steven Gray who were appointed as Operations Directors on 19 April2007. Both Steve and Keith each have over 20 years experience of owning andoperating building services businesses in the North East prior to theiracquisition by Northern Bear and we are delighted that they accepted our offerto join the board. Following the acquisition of Chirmarn on 11 May 2007, David Jay, the previousManaging Director and majority shareholder of Chirmarn, joined the board as ourfirst full-time Finance Director. David is a Chartered Accountant and replacesSteve Roberts, our interim Finance Director, who continues as a Non-ExecutiveDirector. We were all very sorry when Roy Stanley reluctantly stepped down as aNon-Executive Director in May 2007 due to well known business commitments. Royhas been a great source of guidance during our formative months and will begreatly missed. Howard Gold joined as a Non-Executive Director in January 2007 and brings withhim both North East business experience and an invaluable source of legalknowledge, essential for a group of our type. Employees I would like to express the thanks of the board to all employees, without whoseloyalty and commitment, success would be impossible to maintain. A particularmention needs to be made of the directors of each of our acquired subsidiaries,all of whom have embraced the ethos of Northern Bear and helped bond thebusinesses into a cohesive group. Chairman's Statement (continued) Future We are committed to progressively increasing earnings per share by selectiveacquisition and organic development. Growth for growth's sake is not ourobjective. It is encouraging that the gathering scale and momentum of Northern Bear isattracting more potential acquisitions of suitable size and performance. Weexpect the period ahead to be extremely busy. The current year has got off to a very satisfactory start. JP PitherChairman13 June 2007 Consolidated profit and loss account For the period from incorporation to 31 March 2007 Note 2007 £000 £000Group turnoverContinuing operations -Acquisitions 4,751 --- 4,751Cost of sales (3,459) ---Gross profit 1,292Other operating income 9Administrative expenses (1,196) ---Group operating profitContinuing operations (196)Acquisitions 301 --- 105 ---Analysed as:Group operating profit before depreciation, 440amortisation,share based payments and pre-flotation expensesPre-flotation expenses (110)Depreciation (49)Amortisation (148)Share based payments (28) ---Group operating profit 105 Interest receivable 14Interest payable and similar charges - group (184) ---Loss on ordinary activities before taxation (65)Tax on loss on ordinary activities (65) ---Loss for the financial period (130) === Basic loss per share 3 (3.9p) Diluted loss per share 3 (3.9p) Consolidated balance sheet At 31 March 2007 2007 £000 £000Fixed assetsIntangible assets - goodwill 12,266Tangible assets 1,718Investments 11 13,995Current assetsStocks 197Debtors 4,175Cash at bank and in hand 494 4,866Creditors: amounts falling due within one year (6,201) Net current liabilities (1,335) ---Total assets less current liabilities 12,660 Creditors: amounts falling due after more than (3,140)one year Provisions for liabilities (52) ---Net assets 9,468 ===Capital and reservesCalled up share capital 120Share premium account 2,170Merger reserve 7,280Profit and loss account (102) ---Shareholders' funds 9,468 === Consolidated cash flow statement For the period from incorporation to 31 March 2007 Note 2007 £000 £000 Cash flow from operating activities 5 185 Returns on investments and servicingof financeInterest received 14Interest paid (125)Interest element of finance leases (6) --- (117) Taxation - Capital expenditurePurchase of tangible fixed assets (31)Sale of tangible fixed assets 2 --- (29) AcquisitionsPurchase of subsidiary undertakings (1,778) ---Net cash acquired with subsidiaries 1,683 --- --- (95) ---Cash outflow before financing (56) FinancingIssue of ordinary share capital 1,506Issue of preference share capital 50Redemption of preference share (50)capitalDebt due within one year:New secured loan repayable in 2010 456New secured loan repayable in 2016 66Debt due after more than one year:New secured loan repayable in 2010 1,254New secured loan repayable in 2016 574Repayment of secured loans (130)Repayment of invoice discounting (236)facilityRepayment of term loans acquired (3,978)with subsidiaryCapital element of finance lease (58)rental payments --- (546) ---Decrease in cash in the period (602) === Reconciliation of movements in shareholders' funds For the period from incorporation to 31 March 2007 2007 £000 Loss for the financial period (130)Charge in relation to share based payments 28New share capital subscribed (net of issue costs) 9,570 ---Net addition to shareholders' funds 9,468Opening shareholders' funds - ---Closing shareholders' funds 9,468 === Notes to the Preliminary Announcement For the period from incorporation to 31 March 2007 1. Basis of preparation The financial information set out herein does not constitute the Group'sstatutory accounts for the period from incorporation to 31 March 2007 but isderived from those accounts. Statutory accounts for 2007 will be delivered tothe registrar of companies in due course. The auditors have reported on thoseaccounts; their report was (i) unqualified, (ii) did not include a reference toany matters to which the auditors drew attention by way of emphasis withoutqualifying their report and (iii) did not contain a statement under section 237(2) or (3) of the Companies Act 1985. 2. Dividends The Directors do not recommend the payment of a dividend for the period ended 31March 2007. 3. Loss per share The basic loss per share is calculated by dividing the loss for the period of£130,000 by the weighted average number of shares, 3,374,891, in issue duringthe period. The diluted loss per share is calculated by dividing the loss for the period of£130,000 by the weighted average number of shares adjusted to allow for theissue of shares on the assumed conversion of dilutive options. As the impact ofthe dilutive options would be to reduce the loss per share, they are not treatedas dilutive. The diluted loss per share is therefore unchanged from the basicloss per share. 4. Acquisitions On 19 December 2006 the Company acquired 100% of the issued share capital of TheFloor Joist Company (Northern) Limited along with 100% of the issued sharecapital of the groups headed by Ron Gone Limited, Dudley Wilson Limited, KelmaxLimited and Maximuse Limited. On 2 February 2007 the Company acquired 100% of the issued share capital of MGMLimited. The acquisitions have been accounted for using the acquisition method ofaccounting. The book and fair values of the acquisitions were: 4. Acquisitions (continued) Ron Gone, MGM Total Dudley Wilson, Limited Kelmax, Maximuse and Floor Joist £000 £000 £000 Tangible assets 1,408 208 1,616Investments 11 - 11Current assets 3,652 2,155 5,807Creditors (8,488) (1,196) (9,684)Provisions (35) (17) (52) ---Total (liabilities) / assets (3,452) 1,150 (2,302) Goodwill 10,815 1,599 12,414 ---Purchase consideration 7,363 2,749 10,112 === 5. Net cash outflow from operating activities 2007 £000 Group operating profit 105Depreciation and amortisation 197Loss on sale of fixed assets 5Increase in stocks (44)Increase in debtors (287)Increase in creditors 181Charge in relation to share based payments 28 ---Net cash inflow from operating activities 185 === 6. Annual Report The Annual Report will be posted to shareholders in due course and copies willbe available from the Company's registered office at Station House, Station Road, Chester le Street, County Durham, DH3 3DU. 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Northern Bear