7th Aug 2007 07:00
RPS Group PLC07 August 2007 RPS GROUP PLC Interim results for the six months ended 30 June 2007 RPS Group Plc ("RPS" or "the Group") today announces its results for the sixmonths ended 30 June 2007 with profit before tax and amortisation up 36% andearnings per share (before amortisation) up 32%. HIGHLIGHTS 2007 2006 Fee income (£m) 144.4 117.4 +23 %Operating profit (£m)1 23.2 17.3 +34 %Profit before taxation (£m)1 21.6 15.9 +36 %Earnings per share (basic) (p)1 7.31 5.54 +32 %Interim dividend (p) 1.52 1.32 +15 % - Another period of strong trading, extending skills and building geographical position; - Improvement in Group operating margins; - Continued growth in Energy driven by strong demand and bolt on acquisitions; - Property development and infrastructure spend running at high levels supporting Planning and Development growth in UK, Ireland and Australia; - Environmental Management built well on its good performance in 2006; - Growing awareness of climate change beginning to be reflected in revenue opportunities; MetOcean acquisition will support future development in this market; - Strong balance sheet maintained; - Encouraging outlook including opportunities to develop further the international reach of the Group. 1. before amortisation of acquired intangible assets of £0.2m (2006: nil) Brook Land, Chairman, commenting on the results, said: "The Board is encouraged by progress so far this year and remains confidentabout prospects for the full year. Our Energy business has continued its stronggrowth. Opportunities in the UK and Ireland for Planning and Development remaingood. We continue to make encouraging progress in this sector in Australia.Within Environmental Management our water and nuclear safety activities haveperformed well and our business in the Netherlands looks likely to benefit fromthe continued improvement in the economy. The Group has begun to secure work derived from increasing concerns related toclimate change. The announcement yesterday (6 August) of the acquisition ofMetOcean, for a maximum consideration of A$33.3 million (£14 million), confirmsthe wide ranging nature of the climate change opportunity for RPS." Tuesday 7 August 2007 RPS is an international consultancy providing advice upon the development ofnatural resources, land and property, the management of the environment and thehealth and safety of people. We trade in the UK, Ireland, the Netherlands,Poland, USA, Canada and Australia and undertake projects in many other parts ofthe world. The Group is a constituent of both the FTSE250 and FTSE4Good indices. In order to assist in the reduction in the greenhouse gas emissions necessary toslow and eventually reverse global warming the staff of RPS have set themselvesthe task of reducing energy consumption by 5% each year using 2007 as the base.If successful we will halve our (per capita) energy use by 2020. Enquires: RPS Group plc 020 7457 2020 (today)Alan Hearne, Chief ExecutiveGary Young, Finance Director 01235 86320 (thereafter) College HillMatthew Smallwood 020 7457 2020 Board Commentary RPS continues to perform strongly. The buoyant nature of the markets in which weoperate and the successful implementation of our growth strategy has enabled usto maintain our trading momentum and confidence about future prospects. Results Profit before tax and amortisation was £21.6 million (2006: £15.9 million).Basic earnings per share (before amortisation) were 7.31 pence (2006: 5.54pence). The Group had net bank debt of £27.4 million at 30 June (2006: £21.5million). Dividend The Board has increased the interim dividend by 15% to 1.52 pence (2006: 1.32pence). This will be paid on 26 October 2007 to shareholders on the register on28 September 2007. Business Review Strategy The Group seeks to ensure continuous improvement in the range and quality of itsservices and financial performance by: - operating in markets where we can add value to our clients' activities; - endeavouring to achieve leadership in those markets; and - making acquisitions of quality businesses in order to extend our expertise and geographical presence. One of the strengths of the Group over the last 3 decades has been identifyingimportant market opportunities and responding decisively to them. Our investmentin the Energy sector since September 2003, where we have built a world leadingbusiness, has been a good example of this. We have in recent months positioned ourselves to ensure that we take fulladvantage of the opportunities offered by the fast developing awareness ofglobal warming. In consequence, we are beginning to secure new revenues. For example, securing the permissions, licenses and consents which enable theconstruction of capital projects now requires an understanding of the likelygreenhouse gas emissions of proposed schemes. Developers need to plan in a waythat reduces these emissions through appropriate site selection and layout,building design, transport arrangements and energy supply. Once constructed,there is greater focus upon the environmental and energy management andmonitoring of facilities and the health and wellbeing of people. These trends play to the strengths of our Planning and Development andEnvironmental Management businesses and complement our work in the Energy sectorfor oil and gas and renewable energy producers. We have, therefore, made it astrategic objective to ensure that RPS is considered an advisor of choice inrespect of climate change issues. The Board is confident that this strategy and our ability to implement it willcontinue to offer our staff rewarding careers whilst delivering growth and goodreturns for our shareholders. Business ReviewPlanning and Development 2007 2006 Fee income (£m's) 65.1 52.6 +24%Segment result *(£m's) 12.7 9.8 +30% Margin 19.6% 18.6% * before amortisation of acquired intangibles We remain leaders in this market in the UK, Ireland and Western Australiaoperating for blue chip clients in the public and private sectors. In the UK our ability to advise upon the full range of issues relevant to thedevelopment of sustainable communities and secure planning permission for largecomplex schemes remains attractive to clients. In consequence, we continue towork on some of the UK's largest regeneration projects, in London and elsewhere.We are also involved in the transport, waste and minerals sectors, in whichsecuring planning permission has become increasingly complex. Large planningprojects run for many years; despite Government attempts to make the decisionmaking process more efficient, this will remain the case, thereby providing longterm base load work for our business. Burks Green was acquired in July 2006 and performed well in the first half ofthe year. It provides architectural and engineering advice to the industrialand logistics sector and strengthened our capabilities in this marketsignificantly. Its growing base in Poland provides us with exposure to thisexpanding market in Eastern Europe. The Planning and Energy White paperspublished recently by the UK Government put in place a framework to bringforward more transport and energy infrastructure schemes. We are likely tobenefit from this. Our activities in Australia continue to flourish. The long term potential ofthis market and the success of acquisitions made to date encourage furtherinvestment in this fast growing economy. The Irish Government, supported by strong public finances, continues to investin ambitious plans for infrastructure development, through its new NationalDevelopment Plan 2007-2015. We benefit from this investment in both atraditional consultancy role and also as promoting authorities increasingly usepartnership arrangements. Our work in the private sector in Ireland alsoremains buoyant. Energy 2007 2006 Fee income (£m's) 46.9 37.5 +25%Segment result* (£m's) 8.6 5.7 +52% Margin 18.4% 15.1% * before amortisation of acquired intangibles Providing energy supplies is a complex, long term activity and the strength anddepth of our business is proving to be a valuable resource for our clients. The success of our Energy business in 2006 continued into the first half of 2007and strong market fundamentals indicate that this should be maintained. Therequirement that oil and gas exploration and production companies have for oursupport continues to grow. This reflects both buoyant market conditions and ourposition as a world leading provider of consultancy in this sector. Despite theneed to curb carbon emissions from burning fossil fuels it seems inevitable thatthe use of oil and gas will increase significantly in coming decades. Futurereserves are likely to be found in challenging locations, thereby increasing thelong term need for our services. Since the beginning of the year we have completed three acquisitions in thisbusiness for a total maximum consideration of £10.8 million: APA based in Canada(1 February), SARP in Australia (15 March) and Geocon in the UK (29 March).Whilst based on 3 different continents, these businesses all operateinternationally and reinforce the momentum and reputation we already have inthis international marketplace. Our reputation within the financial community in respect of the evaluation ofoil and gas reserves and asset valuation has continued to grow. The oil and gascompanies themselves value the breadth and depth of our expertise, including ourenvironmental and health and safety expertise. Skilled staff have been and willremain in short supply, but our leading position in this market has enabled usto operate successful recruitment and retention strategies, whilst alsoimproving our margins. The growing controversy around a number of UK wind farm schemes illustrates thecomplexity involved in securing approval for low carbon generation energy supplyschemes both onshore and offshore. We are well positioned to assist our clientsachieve the necessary permissions, licences and consent for all such facilities,including new-build nuclear power stations. Environmental Management 2007 2006 Fee income (£m's) 34.6 29.4 +17%Segment result (£m's) 4.3 3.7 +19% Margin 12.6% 12.4% Our Environmental Management business had another successful period,contributing in an important way to the Group's performance as a whole. This segment of the Group now includes the UK environmental sciences activityformerly in Planning & Development, as well as the nuclear safety activitiesformerly in Energy. Both these business areas performed well in the first half. Our business servicing the UK water industry has also progressed well. We areworking on significant commissions for the majority of the water companies.RPS's specific strengths in the water industry coupled with our environmentalcredentials position us well to help with problems created by water shortagesand legislation seeking to improve water quality. The UK market in health &safety consultancy has remained strong, driven by increasing awareness of theimportance of managing these matters more carefully. The economy in theNetherlands continues to improve enabling our business to grow. MetOcean, the acquisition of which was announced on 6 August, represents ourfirst investment in Environmental Management in Australia. It providesoceanographic and meteorological consultancy services to the oil and gas,minerals and shipping industries, as well as to Government agencies with aninterest in marine activity. Funding Our balance sheet remains strong. Net debt at 30 June was £27.4 million, whichrepresents a modest reduction on the position at the end of 2006. Theacquisitions made in the first half of this year involved an aggregate initialcash consideration of £4.6 million. At 30 June we had maximum cash commitmentsin respect of deferred consideration and outstanding loan notes related toacquisitions of £7.5 million in the remainder of 2007, £5.6 million in 2008,£5.2 million in 2009 and £0.8 million in 2010. The acquisition of Metocean was completed on 6 August, for a total maximumconsideration of A$33.3 million (£14.0 million) (Note 13). Our cash generation, in conjunction with bank facilities of £72 million and anability to use equity in transactions, means that we are well positioned tocontinue our acquisition programme. Outlook The opportunities in all our businesses remain encouraging; the need for supportby clients wanting to undertake property and infrastructure development andmanagement remains strong, at a time when environmental regulation gets evermore stringent. There are good indications that high levels of operationalactivity from the oil and gas companies over the next few years will bemaintained and will continue to require our skills. The strengthening of our Energy business in Australia and North America enablesus to introduce other RPS services into these countries. This provides a soundbase for further development and significant long term growth potential. The opportunity provided to us by the need to measure, manage and reducegreenhouse gases in order to mitigate global warming is already generating newrevenue sources for RPS. We anticipate these will grow, underpinned by tighterregulation and legislation being enacted around the world. The Board is encouraged by progress so far this year and remains confident aboutprospects for the full year. The Board of RPS Group Plc 7 August 2007 Consolidated Income Statement Notes Six months Six months Year ended ended ended 30 June 30 June 31 December 2007 2006 2006 unaudited unaudited audited £000's £000's £000's Revenue 3 173,908 143,022 296,843Recharged expenses 3 (29,542) (25,584) (50,832)Fee income 3 144,366 117,438 246,011 Operating profit 3 23,024 17,280 37,482 Interest payable and similar charges (1,755) (1,435) (3,052) Interest receivable 132 90 160 Profit before tax and amortisation of acquired intangibles 21,607 15,935 34,719Amortisation of acquired intangibles (206) - (129) Profit before tax 21,401 15,935 34,590 Tax expense 4 (6,588) (4,844) (10,508) Profit for the period attributable to the equity holders 14,813 11,091 24,082of the parent Basic earnings per share before amortisation of 5 7.31 5.54 12.01acquired intangibles (pence)Diluted earnings per share before amortisation of 5 7.14 5.40 11.74acquired intangibles (pence) Basic earnings per share (pence) 5 7.24 5.54 11.94 Diluted earnings per share (pence) 5 7.07 5.40 11.68 Consolidated Statement of Recognised Income and Expense Six months Six months Year ended ended ended 30 June 30 June 31 December 2007 2006 2006 unaudited unaudited audited £000's £000's £000's Exchange differences on translation of foreign 300 (311) (1,939) operations recognised in translation reserveActuarial gain/(loss) on defined benefit pension scheme - 504 (88)Tax recognised directly in equity 678 271 1,690Income and expense recognised directly in equity 978 464 (337) Profit for the period 14,813 11,091 24,082 Total recognised income and expense for the period 15,791 11,555 23,745attributable to equity holders of the parent Consolidated Balance Sheet Notes As at As at As at 30 June 30 June 31 December 2007 2006 2006 unaudited unaudited audited £000's £000's £000'sAssetsNon current assetsIntangible assets 187,019 156,193 176,929Property, plant and equipment 19,202 17,467 18,344Deferred tax assets 2,401 1,530 2,465 208,622 175,190 197,738Current assetsTrade and other receivables 109,921 84,679 93,296Cash at bank 10,052 6,846 9,964 119,973 91,525 103,260Total assets 328,595 266,715 300,998 Equity and liabilitiesShareholders' equityShare capital 8 6,217 6,067 6,163Share premium 9 91,561 88,909 89,836Merger reserve 10 12,214 5,738 10,642Employee trust shares 10 (2,574) (2,591) (3,042)Share schemes reserve 10 4,524 2,855 4,053Shares to be issued 10 1,997 3,307 1,997Translation reserve 10 (2,243) (915) (2,543)Retained earnings 9 93,023 68,701 79,828Total equity attributable to equity holders 204,719 172,071 186,934of the parent LiabilitiesNon-current liabilitiesBorrowings 37,156 28,277 39,683Deferred consideration 9,350 4,319 6,895Other creditors 330 1,640 330Provisions 1,564 1,781 1,633 48,400 36,017 48,541Current liabilitiesBorrowings 262 61 410Deferred consideration 9,745 9,674 11,559Trade and other payables 60,351 43,603 48,863Corporation tax liabilities 4,786 4,942 4,330Provisions 332 347 361 75,476 58,627 65,523Total liabilities 123,876 94,644 114,064Total equity and liabilities 328,595 266,715 300,998 Consolidated Cash Flow Statement Notes Six months Six months Year ended ended ended 30 June 30 June 31 December 2007 2006 2006 unaudited unaudited audited £000's £000's £000's Cash generated from operations 12 21,919 19,028 40,663Interest paid (1,888) (1,046) (2,930)Interest received 132 91 160Income taxes paid (5,139) (4,036) (10,291)Net cash generated from operating activities 15,024 14,037 27,602 Cash flows from investing activitiesPurchases of subsidiary undertakings and businesses in the (5,143) (737) (13,695)current periodNet (borrowings)/cash acquired with subsidiary undertakings (555) 22 1,511Proceeds from sale of property, plant & equipment 49 709 712Deferred consideration (3,665) (4,699) (10,220)Purchase of property, plant and equipment 6 (2,785) (2,064) (4,481)Net cash used in investing activities (12,099) (6,769) (26,173) Cash flows from financing activitiesProceeds from issue of share capital 1,608 497 1,030Sale of own shares 1,293 - -(Repayment of)/proceeds from bank borrowings (2,635) (6,984) 4,504Payment of finance lease liabilities (109) - (109)Dividends paid (2,967) (2,510) (5,201)Payment of pre-acquisition dividend - (500) (500)Net cash from financing activities (2,810) (9,497) (276) Net increase/(decrease) in cash and cash equivalents 115 (2,229) 1,153 Cash and cash equivalents at beginning of period 9,805 9,593 9,593 Effect of exchange rate fluctuations 39 (518) (941) Cash and cash equivalents at end of period 9,959 6,846 9,805 Cash and cash equivalents comprise: Cash at bank 10,052 6,846 9,964 Bank overdraft (93) - (159)Cash and cash equivalents at end of period 12 9,959 6,846 9,805 Notes to the Consolidated Financial Statements 1. Basis of preparation RPS Group Plc (the "Company") is a company domiciled in England. Theconsolidated interim financial statements of the Company for the six monthsended 30 June 2007 comprise the Company and its subsidiaries (together referredto as the "Group"). The interim financial statements have been prepared using accounting policiesset out in the Annual Report and Accounts 2006. The Company has chosen not toadopt IAS 34 when preparing these interim statements. The interim financialstatements are unaudited but have been reviewed by the Company's auditors. Theresults for the year end 31 December 2006 and the balance sheet as at that dateare abridged from the Company's Annual Report and Accounts 2006 which have beendelivered to the Registrar of Companies. The auditors' report on those accountswas unqualified, did not contain references to any matters to which the auditorsdrew attention by way of emphasis without qualifying the report and did notcontain a statement under Section 237(2) or (3) of the Companies Act 1985. The interim financial statements do not constitute full accounts within themeaning of Section 240 of the Companies Act 1985. Copies of the InterimStatement will be dispatched to shareholders on 28 August 2007. Further copiescan be obtained from the Company's registered office, Centurion Court, 85 MiltonPark, Abingdon, OX14 4RY and will be available on the Group's web-site atwww.rpsgroup.com. 2. Revised business segment results for the six months ended 30 June 2006 As previously announced on 28 June 2007 the segment results for EnvironmentalManagement for the six months ended 30 June 2007 include the environmentalsciences business, formerly in Planning and Development, and the nuclear safetybusiness, formerly in Energy. These changes have been made to reflect the wayour activities are organised and the markets they serve. The effect ofre-allocating the results of these activities on the first half of 2006 areshown below: Planning & Environmental Consolidated Development Management Energy Eliminations £000's £000's £000's £000's £000'sSegment revenue as previously 143,022 68,677 27,227 48,261 (1,143)reportedRe-allocation - (5,681) 8,460 (1,783) (996)Revised segment revenue 143,022 62,996 35,687 46,478 (2,139) Recharged expenses as 25,584 12,174 4,126 9,284 -previously reportedRe-allocation - (1,795) 2,113 (318) -Revised recharged expenses 25,584 10,379 6,239 8,966 - Fee income as previously 117,438 56,503 23,101 38,977 (1,143)reportedRe-allocation - (3,886) 6,347 (1,465) (996)Revised fee income 117,438 52,617 29,448 37,512 (2,139) Segment result as previously 19,105 10,851 2,432 5,822 -reportedRe-allocation - (1,072) 1,223 (151) -Revised segment result 19,105 9,779 3,655 5,671 - 3. Business segment results for the six months ended 30 June 2007 The Group is organised into three main business segments: Planning and Development - consultancy services in the UK, Ireland and Australiarelated to town and country planning, urban design, architecture, transportplanning and highway design, environmental impact assessment and provision ofwater and waste utilities and energy infrastructure. Environmental Management - consultancy services in the UK and the Netherlandsrelated to health, safety and risk management, environmental science and themanagement of water services. Energy - the provision of consultancy services on an international basis to theoil and gas and renewable energy sectors. Planning and Environmental Energy Eliminations Consolidated Development Management _______________ ________________ _______________ _______________ ______________ 30 June 30 June 30 June 30 June 30 June 30 June 30 June 30 June 30 June 30 June 2007 2006* 2007 2006* 2007 2006* 2007 2006* 2007 2006 £000's £000's £000's £000's £000's £000's £000's £000's £000's £000's Segment revenue 78,547 62,996 40,909 35,687 56,585 46,478 (2,133) (2,139) 173,908 143,022RechargedExpenses (13,481) (10,379) (6,328) (6,239) (9,733) (8,966) - - (29,542) (25,584) Segment fee income 65,066 52,617 34,581 29,448 46,852 37,512 (2,133) (2,139) 144,366 117,438 Segment result beforeamortisation ofacquired intangibles 12,728 9,779 4,345 3,655 8,625 5,671 - - 25,698 19,105 Amortisation ofacquired intangibles (146) - - - (60) - - - (206) - Segment result 12,582 9,779 4,345 3,655 8,565 5,671 25,492 19,105 Unallocated expenses (2,468) (1,825) Operating profit 23,024 17,280 * Revised: see Note 2 4. Income taxes The Group's consolidated effective tax rate for the six months ended 30 June2007 was 30.8% (for the year ended 31 December 2006: 30.4%; for the six monthsended 30 June 2006: 30.4%). 5. Earnings per share The calculations of earnings per share were based on the profit attributable toordinary shareholders and a weighted average number of ordinary sharesoutstanding during the period as shown below: Six months Six months Year ended ended 30 June ended 30 June 31 Dec 2007 2006 2006 £000's £000's £000's Profit attributable to ordinary shareholders 14,813 11,091 24,082 Weighted average number of ordinary shares for the purposes ofbasic earnings per share 204,592 200,340 201,635 Effect of shares to be issued as deferred consideration 1,059 1,862 1,059Effect of employee shares schemes 3,760 3,325 3,518 Weighted average number of ordinary shares for the purposes ofdiluted earnings per share 209,411 205,527 206,212 Basic earnings per share (pence) 7.24 5.54 11.94Diluted earnings per share (pence) 7.07 5.40 11.68 The calculation of earnings per share before amortisation were based on theprofit attributable to shareholders before the amortisation of acquiredintangible assets and the tax thereon as shown in the table below and theweighted average number of ordinary shares during the period as shown above. Six months Six months Year ended ended 30 June ended 30 June 31 Dec 2007 2006 2006 £000's £000's £000's Profit attributable to ordinary shareholders 14,813 11,091 24,082Amortisation of acquired intangible assets 206 - 129Tax on amortisation of acquired intangible assets (62) - - Adjusted profit attributable to ordinary shareholders 14,957 11,091 24,211 Basic earnings per share before amortisation (pence) 7.31 5.54 12.01 Diluted basic earnings per share before amortisation (pence) 7.14 5.40 11.74 6. Property, plant and equipment Acquisition and disposals During the six months ended 30 June 2007, the Group acquired assets with a costof £2,785,000 (six months to 30 June 2006: £2,064,000) which includes £328,000acquired through business combinations (six months to 30 June 2006: £44,000).Assets with a net book value of £30,000 were disposed of during the six monthsended 30 June 2007 (six months ended 30 June 2006: £699,000). 7. Acquisitions (1)APA On 31 January 2007 the Group acquired 100% of the issued share capital of APAPetroleum Engineering Inc, a petroleum engineering consultancy with headquartersin Calgary, Canada. Consideration paid in cash at completion was Can$3,000,000(£1,296,000). A further Can$1,500,000 (£648,000) will be paid in cash on boththe first and second anniversaries of the acquisition, provided certainoperational conditions are met. (2) SARP On 14 March 2007 the Group acquired the business, assets and certain liabilitiesof Safety and Risk Practice Pty Ltd (SARP), a provider of health, safety andtraining services to the oil, gas and mining industries. SARP is based in Perth,Australia. Consideration paid in cash at completion was Aus$3,044,000(£1,239,000). A further Aus$1,200,000 (£488,000) will be paid in cash on thefirst anniversary of the acquisition, and Aus$400,000 (£163,000) on the secondanniversary provided certain operational conditions are met. (3)Geocon On 28 March 2007 the Group acquired 100% of the issued share capital of GeoconGroup Services Ltd and the business and certain assets of Geocon InternationalLtd (Geocon). Geocon is a provider of consultancy services to the oil and gasindustry and operates on an international basis. Consideration paid atcompletion comprised £1,905,000 together with 511,726 new RPS Group Plc ordinaryshares priced at 310.23 pence each, valued in total at £1,588,000. A further£952,000 will be paid in cash on each of the first, second and thirdanniversaries of the acquisition, provided certain operational conditions aremet. 8. Share capital 2007 2007 2006 2006 Number £000's Number £000's 000s 000sAuthorisedOrdinary shares of 3p each at 30 June 240,000 7,200 240,000 7,200 Issued and fully paidOrdinary shares of 3p eachAt 1 January 205,446 6,163 201,610 6,048Issued under employee share schemes 1,294 39 625 19Issued as acquisition initial consideration 512 15 - - At 30 June 207,252 6,217 202,235 6,067 9. Statement of changes in equity Share Share Retained Other Total capital premium earnings reserves equity £000's £000's £000's £000's £000's At 1 January 2006 6,048 88,043 59,345 8,435 161,871Actuarial gain - - 504 - 504Tax recognised directly in equity - - 271 - 271Exchange differences - - - (311) (311)Net income and expense recognised directly in equity - - 775 (311) 464Profit for the period - - 11,091 - 11,091Total recognised income and expense for period - - 11,866 (311) 11,555Issue of new ordinary shares 19 866 - (197) 688Own shares - - - (191) (191)Share based payment expense - - - 658 658Dividends - - (2,510) - (2,510)At 30 June 2006 6,067 88,909 68,701 8,394 172,071 Share Share Retained Other Total capital premium earnings reserves equity £000's £000's £000's £000's £000's At 1 January 2007 6,163 89,836 79,828 11,107 186,934Tax recognised directly in equity - - 678 - 678Exchange differences - - - 300 300Net income and expense recognised directly in equity - - 678 300 978Profit for the period - - 14,813 - 14,813Total recognised income and expense for period - - 15,491 300 15,791Issue of new ordinary shares 54 1,725 - 1,418 3,197Sale of own shares - - 671 622 1,293Share based payment expense - - - 919 919Tax on share based payment expense - - - (448) (448)Dividends - - (2,967) - (2,967)At 30 June 2007 6,217 91,561 93,023 13,918 204,719 10. Other reserves Merger Employee Share Shares to be Translation Total reserve trust scheme issued reserve other £000's £000's £000's £000's £000's £000'sAt 1 January 2006 5,738 (2,400) 2,394 3,307 (604) 8,435Exchange differences - - - - (311) (311)Issue of new ordinary shares - - (197) - - (197)Own shares - (191) - - - (191)Share based payment expense - - 658 - - 658At 30 June 2006 5,738 (2,591) 2,855 3,307 (915) 8,394 Merger Employee Share Shares to be Translation Total other reserve trust scheme issued reserve reserves £000's £000's £000's £000's £000's £000'sAt 1 January 2007 10,642 (3,042) 4,053 1,997 (2,543) 11,107Issue of new shares 1,572 (154) - - - 1,418Exchange differences - - - - 300 300Sale of own shares - 622 - - - 622Share based payment expense - - 919 - - 919Tax on share based payment expense - - (448) - - (448)At 30 June 2007 12,214 (2,574) 4,524 1,997 (2,243) 13,918 11. Dividends The following dividends were recognised as distributions to equity holders in the period: Six Six Year months months ended 31 ended 30 ended 30 Dec 2006 June 2007 June 2006 £000's £000's £000's Final dividend for 2006 1.44p per share 2,967 - -Interim dividend for 2006 1.32p per share - - 2,691Final dividend for 2005 1.25p per share - 2,510 2,510 2,967 2,510 5,201 An interim dividend in respect of the six months ended 30 June 2007 of 1.52p pershare, amounting to a total dividend of £3,144,000 was approved by theDirectors of RPS Group Plc on 26 July 2007. These consolidated interimfinancial statements do not reflect this dividend payable. 12. Note to the cash flow statement Six months Six months Year ended 31 ended ended Dec 30 June 30 June 2007 2006 2006 unaudited unaudited audited £000's £000's £000's Profit before tax 21,401 15,935 34,590Adjustments for: Interest payable and similar charges 1,755 1,435 3,052 Interest receivable (132) (90) (160) Depreciation and amortisation 2,450 1,925 4,130 Share based payment expense 919 658 1,659 Increase in trade and other receivables (11,883) (4,098) (7,422) Increase in trade and other payables 7,409 3,263 4,814 Cash generated from operations 21,919 19,028 40,663 The table below provides an analysis of borrowings, comprising cash and cashequivalents and interest bearing bank loans and finance leases, during the sixmonths ended 30 June 2007. At 31 Dec 2006 Cash flow Foreign At 30 June exchange 2007 £000's £000's £000's £000's Cash and cash equivalents 9,805 115 39 9,959Bank loans (39,624) 2,635 (133) (37,122)Finance lease creditor (310) 109 (2) (203)Net debt (30,129) 2,859 (96) (27,366) 13. Post balance sheet event On 6th August 2007 the Group completed the acquisition of 100% of the issuedshare capital of Metocean Engineers Pty Ltd, a company based in Perth, WesternAustralia. The total consideration is a maximum of A$33.3 million (£14.0million). Consideration paid at completion was A$12.0 million (£5.1 million)settled in cash together with 900,855 new RPS Group Plc shares with a totalvalue of £3.0 million (A$7.2 million). Subject to certain operational conditionsbeing met, a further A$5.2 million (£2.2 million) in cash will be paid on thefirst anniversary, A$5.3 million (£2.2 million) in cash on the secondanniversary and a final payment of A$3.6 million (£1.5 million) on the thirdanniversary of completion. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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