26th Mar 2007 07:01
Tanfield Group PLC26 March 2007 Tanfield Group plc Preliminary Results Twelve months to December 31st 2006 FINANCIAL AND BUSINESS REVIEW The Tanfield Group Plc (TAN), the leading global manufacturer of zero emissionvehicles and aerial work platforms, is pleased to announce its preliminaryresults for the 12 months to December 31, 2006. Building on the progression achieved during 2005, these results furtherdemonstrate the advancement of The Tanfield Group Plc as a high growth,profitable and robust business. All figures and their comparatives are presented in line with the InternationalFinancial Reporting Standards (IFRS). Highlights: • Turnover increased to £40.9m, from £22.4m • Significant growth in profit • Robust balance sheet; £44m net assets • Built & delivered world's first high performance 7.5t electric truck • Confirmed orders for new range of electric vehicles • Fully integrated UpRight acquisition • Strengthened global distribution network • Continued significant growth in order book • Substantially increased levels of enquiry • Significant working capital to fund strong growth in 2007 Chairman's Statement Turnover for the 12 month period grew to £40.9m, compared to £22.4m for the fullyear to December 2005. The Group delivered this substantial increase throughorganic growth of existing operations and a contribution from the UprightPowered Access business, acquired midway through 2006. Operating profit for the period of £5.4m before restructuring costs and aftergoodwill adjustments demonstrates significant growth from the £2.0m profit inthe year to December 2005. After restructuring, the £3.5m operating profitbefore tax for the period (from continuing business) is an increase of 75%against 2005. The balance sheet is robust, with Net Assets at the end of December standing at£44m (£11.8m at the end of December 2005). Net Current Assets were £32m (2005£2.5m), with cash balances in excess of £13m and borrowing limited to a £1.1mloan on Group properties. This underlines that the Company has significantlevels of working capital, allowing it to fund strong organic growth in 2007. Internal Restructuring The UpRight acquisition paved the way for the internal restructuring of theGroup into two key divisions: Powered Access, sold under the UpRight brand; andSpecialist Electric Vehicles, sold under the principal brand of Smith ElectricVehicles and sub-brands of Norquip and Jumbotugs. The highly profitable growth of the past year demonstrates the success of theGroup's strategy to concentrate on the expansion of these two key divisions. Growth of the Group Over the past 12 months, the Group has continued to consolidate and develop itsportfolio of businesses, focused on providing zero emission vehicles and poweredaccess platforms to customers operating in closed urban and industrialenvironments. We significantly enhanced this portfolio with the acquisition of UpRight in June2006. This acquisition presented an ideal opportunity for the Group toconsolidate all UK product assembly operations on one flagship site: Vigo Centrein Tyne & Wear, which was officially opened by the Prime Minister, the Rt HonTony Blair MP, in February 2007. The acquisition of UpRight in June 2006 accelerated Tanfield's growth as aglobal business. I am delighted with the progress we have made with UpRight andpleased to announce that it entered 2007 with a strong order book. With UpRight, we have successfully restored market confidence in what was a verystrong global brand. We have re-established an effective worldwide distributornetwork, which now stands at over 150 distributors, compared to 15 in June 2006.We have also been successful in extending the UpRight product range. Theseachievements are reflected in the huge increase in average weekly order intake. UpRight has provided access to a well-established component supply chain fromlow cost countries and the move to Vigo Centre is providing further costsynergies, by consolidating all Group product assembly operations on oneflagship site. The strong growth in our electric vehicle service and maintenance operations hasunderpinned overall growth in our Specialist Electric Vehicles Division. Thiscore element of the business is beginning to fulfil its potential in terms ofaddressing the requirements of large urban fleet operators, who want to reducetheir operational costs and more importantly, greatly reduce their carbonfootprint. This is evident in the increase in both the order book and enquirylevels. Board Changes In June 2006 we welcomed Charles Brooks as our new Financial Director. Charlesworked on the UpRight acquisition for several months prior to this appointment,where he very ably demonstrated his acumen, diligence and dedication toTanfield. In September 2006, Brendan Campbell joined the Board as Operations Director.Brendan has been with the Group for six years and has played a key role in thesuccessful integration and de-risking of the UpRight business; developing thelow cost supply chain; and delivering a five-fold increase in output. Also in September, I stepped down from my dual role as Chief Executive andChairman, with the appointment of Darren Kell as Chief Executive. As BusinessDevelopment Director, Darren played a key role in the substantial growth of theGroup over the previous two years and subsequent successful integration of theUpRight business. I am confident that this very strong team can continue to establish Tanfield asa world leader in both commercial electric vehicles and powered accessplatforms. Summary The group has experienced another exciting year of exceptional growth andimproved profitability. The consolidation onto one assembly site has improvedefficiency and control, and has given us significant expansion potential tofurther continue this growth. We also see opportunities to increase capacity inthe USA, both for powered access and electric vehicles. We operate in sizeable markets which present significant opportunities forgrowth. The Group's strategy remains to grow its two core divisions, bothorganically and - where opportunities arise - through acquisition. There has been a major step change in our organisation over the past 12 months.We now have 600 people in the business, led by a strong, integrated seniormanagement team. We have facilities in the UK, USA, and Japan, with anestablished manufacturing supply chain in China and Eastern Europe. I would like to take this opportunity to thank all our people for their effortsand for the continuing support of all our stakeholders. Roy StanleyChairmanThe Tanfield Group Plc Chief Executive's Report for 2006 & Trading Update for Q1 2007 OPERATIONAL HIGHLIGHTS • Built & delivered Smith Newton, the world's first high performance 7.5t electric truck • Successfully penetrated parcel delivery & logistics market, with sales of Newton to TN T Express and CEVA Logistics (formerly TNT Logistics) • First Newton order from DHL Logistics • Ongoing Newton trials with TNT, CEVA and Starbucks are meeting or exceeding all performance expectations • Successfully penetrated retail sector, with sales to Marks & Spencer and Sainsbury's Online • Launching Smith Edison, the world's first 3.5t electric van, in April 2007, to facilitate further penetration of the broader urban delivery and logistics sector • Developing 9t and 12t Smith Newtons, to facilitate penetration of the chilled food distribution market • Further confirmed orders for new range of electric vehicles • Substantially increased levels of enquiry for electric vehicles • Fully integrated and de-risked UpRight acquisition (acquired June 2006) • Strengthened UpRight global distribution network from 15 at point of acquisition, to over 150 • UpRight average weekly order intake grown from £150,000 at point of acquisition, to £1.2m • UpRight product portfolio expanded from 10 machines to over 20 • Increase in volume orders: 1,300 machines to Benelux region; orders of 100+ machines to clients in UK, Southern Europe, Scandinavia and USA • Successful UpRight brand re-launch in the USA in February 2007; average weekly order intake quadrupled to $2m • Record UpRight forward order book of £35m • Consolidated all product assembly operations in Vigo Centre, a new 250,000sq ft UK production facility, providing cost savings and production synergies Introduction 2006 was another year of strong growth for Tanfield. The launch of the Smith Newton, the world's largest high-performance,all-electric truck was a phenomenal success and Tanfield remains uniquelypositioned to win business in this sector, as the only company in the world witha zero emission production model of this size and carrying capacity. The acquisition of UpRight Inc in 2006 and the subsequent expansion of itsactivities confirmed that we have the ability to transform a struggling companyinto a successful, profitable operation. Our sales and marketing strategy,allied to the strength of the UpRight brand, has proven to be so successful thatwe now have a record forward order book for aerial work platforms. Vigo Centre The move to Vigo Centre, a modern 250,000sq ft facility in North East England,has been crucial to our operational success and provides a superb foundation forfuture growth. Vigo Centre opened in November 2006 and Tanfield immediately began transferringassembly of UpRight products from the incumbent Irish facility in Dublin. In a time frame of just over two months, the Group simultaneously recruited andtrained a new, UK-based assembly workforce, while transferring the entireUpRight machine production operations from Dublin to Vigo Centre. The Group alsoquadrupled UpRight machine output during the same period. Vigo Centre was fully operational and assembling the Group's entire productportfolio by the beginning of December. This was delivered ahead of our internalschedule and under budget. The Company endeavoured to keep down costs. To this end, the Chairman andfounder of Tanfield, Roy Stanley, successfully negotiated a 15-month rent-freeperiod at Vigo Centre. The Chairman also secured a £1.95m grant for Tanfield,from Regional Development Agency, One NorthEast. The overall operational synergies and improvements gained from consolidationinto Vigo Centre and have led to reduced unit build costs and greatly improvedoutput volumes. In 2006, the Group also started manufacturing smaller products from the UpRightportfolio at a facility in Fresno, California. We anticipate significantlybroadening manufacturing capability in North America during 2007. The accelerated growth in forward orders placed further demands on ourProduction team to increase output and they rose to the challenge. Machineoutput hit 100 units per week at the end of February 2007, ahead of schedule. Weare installing a third, larger crane line to accommodate larger machines andvehicles. Divisional Progress Report 1. Specialist Electric Vehicles Division The division's flagship brand is Smith Electric Vehicles, a leading manufacturerof zero emission commercial electric vehicles - principally vans and trucks. Itsnew technology vehicles have fast acceleration, top speeds of up to 55mph and arange between battery charges of up to 150 miles. These characteristics makethem ideal for urban applications where vehicle emissions are becomingincreasingly important. As zero emission vehicles, the entire Smith range qualifies for several key taxand legislative benefits - including exemption from the London CongestionCharge. Jumbotugs and Norquip are airport-specific sub-brands, manufacturing airsideground support vehicles. Overall, the division continues to benefit from a buoyant level of enquiries andaccelerated market interest created by the changing drivers within thecommercial vehicle market. The older technology electric vehicles - and the newtechnology Faraday, launched in 2005 - have maintained strong sales growth inthe traditional market sectors of municipalities, dairies and waste removalapplications. The launch of the latest generation of high performance, zero-emission vehicles,initially with the Smith Newton 7.5 tonne truck, has been very well received bythe target market of urban delivery fleet operators. This is a new market whichis outside of the division's traditional customer base; and one which theDirectors anticipate will be high growth. The first of these Smith vehicles have entered service with business-to-businessparcel delivery company TNT Express; and contract logistics company CEVALogistics (formerly TNT Logistics), on behalf of Starbucks. Attracting suchhigh profile launch partners has led to the division enjoying unprecedentedlevels of enquiries from potential customers with broadly similar deliveryapplications. TNT Express has indicated that there is the potential for it to replace up to10% of its UK fleet with zero-emission vehicles such as the Smith Newton. TNT'sglobal chief executive, Peter Bakker, has also commissioned a Europe-wide studyinto the adoption of Newton throughout TNT's operations. Trading Update In February 2007, we entered into an agreement to supply Marks & Spencer withthe Smith Newton and they have purchased the vehicle for distribution to theirstores. Again, they are examining the potential to replace a proportion of theirinternal-combustion powered fleet with the Newton. Since then, this division has won new orders for the Smith Newton from asignificant number of other fleet operators, including DHL, the logisticscompany. DHL operates a fleet of 76,000 vehicles worldwide and is part ofDeutsche Post World Net. DHL will take delivery of a 9 tonne version of Newton, with greater payloadcapabilities. The first vehicle, the largest higher function electric truck everproduced, will operate for DHL's Department Stores & Fashion division. I am pleased to announce that the ongoing field trials of our first SmithNewtons with TNT Express UK and CEVA Logistics continue to be a success. The TNT vehicle is deployed in business-to-business express delivery operationsin and around London. The CEVA vehicle is deployed in delivery operations forcoffee retailer Starbucks in and around London. Both TNT and CEVA have confirmed that Newton is meeting or exceeding all oftheir expectations, in terms of performance; reliability; and driveracceptability. TNT Express UK remains committed to replacing up to 10% of its UK fleet withNewtons, a total of approximately 200 vehicles, if the trial continues to be asuccess. Tanfield is in further negotiations with CEVA Logistics over the supplyof more Newton vehicles, where pertinent. TNT NV is examining opportunities where it could deploy Smith Newtons inmainland Europe. Tanfield is also presently in discussions to supply both CEVA and TNT withEdison, our higher function, all-electric, 3.5 tonne van. Product Development During 2007, the division will launch a 12 tonne version of the Smith Newton.Along with our 9 tonne Newton, this will not only increase the Company's UKtarget market by offering greater payload capabilities, but will facilitate thedevelopment of the lucrative chilled-food distribution market. The 9 and 12tonne vehicles will also provide solutions more suited to the regulatoryrequirements of markets in mainland Europe and North America. The next vehicle in the high-performance, zero-emission range, the Edison, willbe offered in 3.5 to 4.3 tonne sizes; and configurations including chassis cab,panel van, crew cab and minibus. This will be the world's first 3.5 tonne, all-electric van and we anticipatethere will be widespread demand from urban fleet operators, in existing and newmarket sectors. We have already secured confirmed orders and generated furthersignificant interest for Edison - both from existing and new customers - and wewill be announcing our launch partners for the vehicle at the Commercial VehicleShow, held in the UK in April 2007. Other products in this family of vehicles are under development and these willbe launched over the course of the next 18 months. Market Development Aside from the exciting domestic opportunities and potential for additionalorders from existing customers, we are also receiving significant enquires frompotential customers within territories including mainland Europe; theAsia-Pacific region; and in particular North America. Converging market drivers such as congestion charging; oil pricing; energysecurity; vehicle maintenance costs; and punitive legislative measures onvehicle emissions, are now applicable to a global marketplace. Smith's productsare very pertinent for applications in these markets and we are examining waysin which our vehicles can be offered to customers outside the UK. The North American market is extremely receptive to the concept of the higherfunction, zero emission, closed urban delivery vehicle. Discussions are ongoingwith a number of existing, global customers and new USA customers, with regardto the most efficient method to facilitate their requirements for our productswithin these markets. Service and Maintenance The service and maintenance sub-division, SEV, has doubled sales over the pasttwelve months. There continues to be further growth potential in this divisionbased out of our nationwide chain of depots. SEV currently has over 160 peopleemployed in servicing and maintaining electric vehicles. The sale of each newelectric vehicle normally involves a five year service and maintenance contract.A key USP for domestic vehicle sales is the coverage of this service andmaintenance network, which gives existing and future buyers of electric vehiclesthe confidence that there is a high level of support for their fleets. SEV is also in negotiation with a number of potential customers outside itstraditional operating sphere, further broadening the scale and breadth of theinfrastructure and service capability. Moving into new territories will alsoaccelerate the growth of this part of the Group. 2. Powered Access Divison UpRight Powered Access is an aerial work platform manufacturer with a brand namerecognised worldwide and a proven product portfolio. It has an establishedglobal network of independent distributors and its own sales and service centresin the USA and Japan. UpRight products, which are largely battery powered, are used for safe workingat height, in applications such as building and facilities maintenance; andconstruction. They are known by a variety of names, including powered accessplatforms, aerial work platforms, aerial lifts and cherry pickers. The UpRight Powered Access business was acquired on 9 June 2006. Since then wehave significantly increased machine output, in order to keep pace with thegrowth in orders. We have built on the extensive goodwill that exists within the global markettowards UpRight, by strengthening and developing the sales and marketingstructure. This, allied to the recruitment of new, high-quality dealers anddistributors, this has significantly increased order intake. Output Growth The effectiveness of our Operations team is again demonstrated by the fact thatthey continue to hit significant production milestones: 50 machines per week in2006; and 100 machines per week by the end of February 2007. In order to meet anticipated demand, ongoing output growth is planned and thefacility will be producing 150 units per week by the third quarter of 2007. Athird, larger capacity overhead crane line has been ordered and will beinstalled in the second quarter of 2007. USA The USA presents a significant market opportunity for this division,representing almost half of the global marketplace for powered access equipment. We commenced limited manufacture of a select cross-section of machine typestowards the end of 2006 at the Group's facility in Fresno, California. Thisfacility comfortably reached our production target of 20 units per week by theend of February 2007. The UpRight brand was re-launched in the USA at the American Rental Associationshow in February 2007, where the emergence of another significant player in theUS market was very well received. This resulted in substantial machine orderintake, averaging in excess of US$1m per week, within four weeks of the show'send. The Group is currently assessing the best method to address the strong marketdemand in the US market for UpRight products and further leverage brand equity.It is clear that this will require a significant expansion of our US assemblyoperations. Product Development When we acquired UpRight in 2006, the previous owners were at an advanced stagein a programme of product rationalisation that in 2006 cut the range from 18models to just 10. This dwindling portfolio became of limited interest to rentalcompanies and stronger distributors. During 2006, Tanfield re-launched dormant models and integrated four productsfrom the Aerial Access range, expanding the UpRight portfolio to over 20 models. Throughout the course of 2007, the division will be launching a number ofmid-range products for the UpRight portfolio. These are updated versions ofdormant machines that were once made at UpRight's US facilities. There is strong global demand for these new products and we anticipateassembling these machines in both Europe and the USA. The appetite for these products was demonstrated by our recent announcementregarding the re-launch of the UpRight AB46 machine. UpRight had ceasedproduction of the AB46 some time prior to Tanfield's acquisition. Within twoweeks of announcing we were bringing back this popular machine, we securedorders for over 100 units. We believe the addition of the AB46 to the range willsignificantly increase UpRight's ability to penetrate the high volume majorrental companies worldwide. Customer Base During 2006, Tanfield appointed new UpRight distributors worldwide andre-engaged with ex-UpRight distributors who had left as the UpRight productrange dwindled. The global distributor network now stands at over 150independent companies. Tanfield also appointed sales managers in the Scandinavia, Southern Europe andAsia-Pacific territories; and re-established a US sales team. Market Development Globally, the powered access industry remains buoyant in all sectors. Thewell-regarded 2007 Access Confidence Survey, published by influential industrymagazine Access International, recorded an unprecedented level of optimism. Half of rental companies anticipate growing by more than 10% and another 46%expect to grow by 1 - 10%. Overall, 64% said they will grow their fleets, with afurther 18% still planning to buy new machines to replace ageing stock. While the North American market has matured, anecdotal feedback indicates thatthere is a substantial appetite among access buyers for an alternative to themain two OEM brands, JLG and Genie. This is demonstrable in another highly mature market - Scandinavia. Here,UpRight is already winning volume orders from both its established distributornetwork and from major rental companies. We anticipate that the recent EU legislation governing safe Working at Heightwill continue to drive sales in member states. Other key growth markets includethe Middle East, which is increasingly eschewing labour-intensive scaffoldingfor mega-construction projects, in favour of more productive US buildingpractices, which rely on high intensity use of aerial work platforms. Trading Update I am delighted to announce that UpRight has further strengthened its independentdistributor network, with new distributors appointed in Saudi Arabia; SouthKorea and Turkey. All three companies are established and experienced, providingexcellent sales channels into these territories. Our strategy to grow the existing network of high quality independentdistributors continues to translate into significant orders - the appointment ofone new distributor for the Benelux region resulted in an order for over 1,300UpRight machines. Further volume orders of 100+ units each have been receivedfrom distributors in the USA, Southern Europe, Russia and Scandinavia. This week, UpRight has won two more volume orders. A major UK access rentalcompany has ordered 96 machines, with a value in excess of £2m. This is particularly pleasing as UpRight had declining market penetration in theUK under its previous owners. The order came via IPS Ltd, our Master Distributor for the UK, which furthervalidates our strategy of appointing well-regarded distributors who can add realvalue to the product, in territories where UpRight sales historically were weakor in decline. We have also received an incremental order for 150 UprRight X32 scissor lifts,with a market value in excess of £1m. The machines will be supplied to meet anew order placed with one distributor in mainland Europe. When we acquired UpRight in June 2006, it was producing around 20 machines perweek and had a forward order book of less than £3m. The value of the UpRightforward order book for 2007 now stands at over £35 million, while output is 100machines per week and climbing. Summary We have two key brands which are well respected in their markets. We have arobust distribution model with strong sales channels. We are experiencingunprecedented enquiry and order intake levels and we are poised to furtheraccelerate this growth with the introduction of additional new products andexpansion into new geographic markets and sectors. The business has never been in better health. The Board and senior managementteam have been strengthened and we continue to successfully penetrate all of ourtarget markets. These developments, allied to the operational synergies broughtabout by the move to Vigo Centre and the developing supply chain from low-costcountries, mean that Tanfield is well positioned for continued growth in 2007. Darren KellChief ExecutiveThe Tanfield Group Plc TANFIELD GROUP PLC CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2006 2006 2005 £000's £000'sContinuing OperationsRevenue 40,913 22,431 Other operating income - 42Changes in inventories of finished goods and WIP 1,222 1,983Raw materials and consumables used (20,275) (9,112)Reversal of previously impaired assets - 69Staff costs (11,290) (9,080)Depreciation and amortisation expense 816 456Other operating expenses (5,946) (4,680)Restructuring costs (1,877) - Profit from continuing operations 3,563 2,109 Finance costs (105) (109) Net Profit before tax for year 3,458 2,000 Income tax expense (846) (344) Profit for the year from continuing operations 2,612 1,656 Discontinued operations(Loss)/Profit for period from discontinued operations (108) 38 Net profit for the year 2,504 1,694 Earnings per shareFrom continuing operationsBasic 1.10p 1.00pDiluted 1.03p 0.97p From continuing and discontinued operationsBasic 1.05p 1.03pDiluted 0.99p 0.99p CONSOLIDATED BALANCE SHEET AS AT 31 DECEMBER 2006 2006 2005 £000's £000'sASSETSNon Current AssetsProperty, Plant and Equipment 3,734 4,015Goodwill 5,143 5,143Intangible Assets 5,792 3,213 14,669 12,371Current AssetsInventories 14,158 4,377Trade and Other Receivables 13,833 5,700Investments 94 -Cash and Cash Equivalents 13,605 1,478 41,690 11,555TOTAL ASSETS 56,359 23,926LIABILITIESCurrent liabilitiesTrade and Other Payables 6,801 5,511Tax Liabilities 1,178 299Obligations Under Finance Leases 421 631Bank & Other Loans and Overdrafts 163 1,048Other Creditors 2,221 1,583 10,784 9,072Non Current LiabilitiesBank & Other Loans 948 1,392Other Creditors 310 211Obligations Under Finance Leases 549 723Deferred Tax Liability 19 45Convertible Loan Notes 69 69Provisions 262 661 2,157 3,101TOTAL LIABILITIES 12,941 12,173EQUITYShare Capital 2,921 1,905Share Premium Account 29,578 1,509Share Option reserve 255 308Loan Stock Equity Reserve 6 6Merger Reserve 1,534 1,534Capital Reduction Reserve 7,228 7,228Profit And Loss Account 1,896 (737)TOTAL EQUITY 43,418 11,753 TOTAL EQUITY AND LIABILITIES 56,359 23,926 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED31 DECEMBER 2006 Share Capital Loan Stock Profit Share Option Share Reduction Equity Merger and Loss Total capital reserve Premium Reserve Reserve Reserve Account Equity £000's £000's £000's £000's £000's £000's £000's £000's Balance at 1 January 2006 1,905 308 1,509 7,228 6 1,534 (737) 11,753 Issue of new share capital 1,000 - 28,055 - - - - 29,055 Exercise and Grant of share options 16 (53) 14 - - - 129 106Net profit for the year - - - - - - 2,504 2,504 Balance at 31 December 2006 2,921 255 29,578 7,228 6 1,534 1,896 43,418 CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2006 2006 2005 £000's £000's Operating ActivitiesCash used in operations (7,248) (1,990)Interest paid (208) (207) Net Cash used in Operating activities (7,456) (2,197) Investing ActivitiesAcquisitions (6,851) (324)Purchase of property, plant and equipment (503) (2,562)Proceeds from sale of property plant and equipment 150 -Purchase of investments (94) -Purchase of intangible fixed assets (312) (1,488)Interest received 34 98 Net cash used in investing activities (7,576) (4,276) Financing ActivitiesIssue of ordinary share capital 29,055 6,886Repayment of bank loan (870) 742Capital element of finance leases (567) (121) Net cash from financing 27,618 7,507 Net Increase in Cash and Cash Equivalents 12,586 1,034 Cash and cash Equivalents at beginning of Year 960 (74) Cash and Cash equivalents at end of the year 13,546 960 Notes 1 Accounting Policies The financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS"). 2. Unaudited Financial Statements The above figures do not constitute full accounts within the meaning of Section 240 of the Companies Act 1985. The figures for the year ended 31st December 2005 constitute abridged accounts extracted from the published accounts for the year which have been filed with the Registrar of Companies and on which the auditors' report was unqualified and did not contain a statement under Section 237(2) or (3) of the Companies Act 1985. 3. Earnings per ordinary share Earnings per share have been calculated using the weighted average number of shares in issue during the relevant financial periods. The weighted average number of shares in issue is 237,396,217 (2005 - 165,038,027), and the earnings, being the profit on ordinary activities after taxation and minority interest are £2,504,000. (2005: 1,694,000). The weighted average number of shares for diluted earnings per share is 252,639,361 (2005 - 165,038,027) and the diluted earnings are £2,490,000 (2005 -£1,680,000). Year ended 31 Year ended 31 December 2006 December 2005 Pence Pence Earnings/(Loss) Per share 1.05 1.03 Diluted Earnings per share 0.99 0.99 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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