26th Mar 2008 07:01
Nationwide Accident Repair Srvs PLC26 March 2008 NARS NATIONWIDE ACCIDENT REPAIR SERVICES PLC ("Nationwide", "the Company" or "the Group") Preliminary Results for the year to 31 December 2007 Nationwide provides automotive crash repair and accident administration servicesto the UK insurance industry. With a national network of accident repair centreslocated across England, Scotland and Wales employing over 2,200 people, it isthe largest dedicated provider of accident repair services in the UK. Financial summary 2007 2006Revenue £151.9m £151.2mOperating profit after non-recurring items* £6.6m £2.2mProfit before tax after non-recurring items* £6.8m £2.4mEarnings per share after non-recurring items* 11.3p 3.1p Underlying resultsOperating profit before non-recurring items* £6.6m £5.8mProfit before tax before non-recurring items* £6.8m £5.9mEarnings per share before non-recurring items* 11.3p 9.0p Underlying results under IAS 19 (non-corridor)Operating profit before non-recurring items* £7.6m £6.7mProfit before tax before non-recurring items* £7.8m £6.9mEarnings per share before non-recurring items* 12.5p 10.5p * Non-recurring items affected results for the year 31 December 2006 only Key Points • Strong results with profit before tax before non-recurring items up 15% to £6.8m (2006: £5.9m) • Earnings per share before non-recurring items up 26% to 11.3p (2006: 9.0p) • Strong balance sheet with net cash at year end of £5.2m (2006: £6.9m) • Recommended final dividend up 15% to 3.0p per share, making total for the year of 4.5p (2006: 2.6p) • Major contract wins during the year: - new customers include Hastings Direct and Zenith; - significant contract extensions with existing customers: Norwich Union, AXA and Zurich; and - full benefits of these contracts to flow through in 2008 and beyond • Accident management operations continue to demonstrate encouraging growth • Group continues to drive consolidation within the crash repair industry: - four new bodyshops acquired in the year: Llandudno, Lincoln, Matlock and Hull; and - post year end acquisitions of bodyshops in Gravesend and Scunthorpe • 2008 has started positively and the Board remains confident of prospects Michael Marx, Chairman, commented, "It is encouraging to have achieved such pleasing results whilst laying strongfoundations for future growth. We are focused on developing customer relationships which will enable us toleverage our scale and operational efficiencies to the benefit of bothNationwide and our customers. The new agreements we secured over the course of2007 will bring further benefits in the current financial year and beyond, asthe additional volumes are generated. Following the strategic decision todecline the renewal of a major contract in the second quarter, we have now morethan replaced the foregone volumes with significant contract wins from both newand existing customers. Furthermore, we believe that our business is well placed to benefit from marketconsolidation both by acquiring bodyshops where appropriate and also by takingadvantage of opportunities to win additional volumes from insurers consolidatingtheir repair base. The Board therefore remains confident in its businessprospects." Enquiries: Nationwide Michael Wilmshurst, Chief Executive T: 020 7448 1000 todayAccident Repair David Loftus, Finance Director Thereafter: 01993 701720Services plc Biddicks Katie Tzouliadis/ Sophie Lane T: 020 7448 1000 Arbuthnot James Steel/ Alasdair Younie T: 020 7012 2000Securities CHAIRMAN'S STATEMENT IntroductionI am pleased to report Nationwide's preliminary results for the year ended 31December 2007. It is encouraging to have achieved such pleasing results whilelaying strong foundations for future growth. Financial OverviewRevenue for the 12 months ended 31 December 2007 increased to £151.9m (2006:£151.2m), a very creditable performance given our decision to let a £20mcontract lapse due to unattractive commercial terms. Operating profit beforenon-recurring items rose by 15% to £6.6m (2006: £5.8m). Adjusted profit beforetax excluding non-recurring items increased by 15% to £6.8m (2006: £5.9m) andadjusted earnings per share excluding non-recurring items increased by 26% to11.3p from 9.0p last year. The Company adopts IAS 19, the 'corridor approach', for its pension obligations.However, in order to provide shareholders with financial results which arecomparable with other companies, results under IAS19 (non-corridor) are alsoshown. Under IAS 19 (non-corridor), operating profit before non-recurring itemsincreased by 14% to £7.6m (2006: £6.7m). Profit before tax before non-recurringitems increased by 14% to £7.9m (2006: £6.9m) and earnings per share beforenon-recurring items increased by 19% to 12.5p (2006: 10.5p). It should be notedthat non-recurring items affected last year's results only. The Group's cash position remains very strong, with net cash at 31 December 2007of £5.2m (2006: £6.9m), having acquired four new bodyshops during the year for atotal cash consideration of £2.1m in cash. DividendThe Group has a progressive dividend policy in place and the Directors arepleased to recommend the payment of a final dividend of 3.0p per share for theyear, an increase of 15% on last year (2006: 2.6p). With the interim dividend of1.5p, this takes the total dividend for the year to 4.5p (2006: 2.6p). Subjectto approval at the Annual General Meeting, the final dividend will be paid on 2June 2008 to shareholders on the register at the close of business on 9 May2008. Trading OverviewThe year started well with a good first quarter. However, in the second quarterwe took the strategic decision to decline the renewal of a substantial contractwhich was offered on commercially unattractive terms. Since then, we have morethan replaced the lost volumes from new and existing customers. While work fromthese new agreements has already started to flow, we expect to see the fullbenefits come through in the current financial year and beyond. As insurers lookto consolidate the number of vehicle repair suppliers, our market leadingposition and high standards of customer service should ensure that we willcontinue to be well placed to take advantage of the changes, as these newagreements demonstrate. We remain focused on driving efficiencies and leveraging our scale in order torealise cost savings. By working together with customers we are able to manageour operations carefully, deploying work across the network of bodyshops in away which allows for maximum efficiency and cost effectiveness. During the year,we have achieved cost savings and we will continue to look at further ways inwhich to enhance operations. During the period, we continued our acquisition growth strategy, with thepurchase of four new bodyshops in order to meet demand from our customers inspecific regions. We also refined our existing network of repair centres,disposing of five sites which were no longer suitable for our needs. Our Network Services Division, which offers insurers and fleet operators acomprehensive "one-stop shop" option of accident management services, continuesto perform well. The Aquilo business, acquired in December 2006, wassuccessfully integrated during the year and has contributed to Network Services'success. OutlookThe strategic decisions which we took in 2007 have established the foundationsfor future growth. We are focused on developing customer relationships whichwill enable us to leverage our scale and operational efficiencies to the benefitof both Nationwide and our customers. The new agreements we secured over thecourse of 2007 will bring further benefits in the current financial year andbeyond, as the additional volumes are generated. Following the strategicdecision to decline the renewal of a major contract in the second quarter, wehave now more than replaced the foregone volumes with significant contract winsfrom both new and existing customers. Furthermore we believe that our business is well placed to benefit from marketconsolidation by acquiring bodyshops where appropriate and by taking advantageof opportunities to win additional volumes from insurers consolidating theirrepair base. The Board remains confident in its business prospects. Michael MarxChairman CHIEF EXECUTIVE'S REPORT Introduction2007 was a record year for our Group and our ability to continue to improve ourfinancial performance, at a time of customer and market change, is indicative ofthe strength of our business offer model and team. CustomersIn 2007 we took the difficult, but strategic decision to decline a substantialcontract on the basis of the terms offered. We believed that we would be able toreplace this work (in excess of £20 million) with other customers. A key part ofour decision was driven by our underlying business approach, which is to alignourselves with customers whose business models reflect our strategy ofincreasing repair efficiency, by directing work to the most suitable site,utilising our excellent IT platform to develop additional efficiencies andleveraging our own economies of scale. I am pleased to report that over the remainder of the year, we more thanreplaced the lost work. This was achieved through a mix of new contract wins andvolume extensions with existing customers. The new wins we secured were withHastings Direct and Zenith and we agreed significant additional volumes withNorwich Union, AXA and Zurich. These agreements will help to underpin theGroup's growth in 2008 as they are fully implemented. In expanding our business, our strategy has been, and continues to be, todevelop a broad base of customers. While typically half of our business istransacted with our top five insurance customers, these insurers change overtime, reflecting market conditions. It is, therefore, important to us tomaintain contact and foster relationships across the insurance industry as awhole and to adapt to the changing balance of work we carry out for customers ina way which suits both parties. Over the past few years, by adopting this "BroadChurch" approach and by investing time to understand our customers' futurestrategies, we have successfully managed both the growth of contracts and anumber of customer transitions. We are also applying this longer term accountrelationship methodology to customers outside our current core motor insurercustomer base, namely fleet and rental operators and motor manufacturers andsecured a further 23 customers operating in these fields. A new initiative,begun during 2007, was the launch of a retail sales operation. From a standingstart, this has generated sales of £1.84m in its first year and we will look togrow retail sales further in 2008. Overall, the market consolidation we highlighted in last year's reportcontinues, with a considerable number of insurance companies reducing the numberof repairers to which they send work. With our skilled team, national coverageand sophisticated IT package, we believe that we are well positioned to benefitfrom ongoing consolidation. PeopleNationwide employs over 2,200 skilled and committed people, including 130apprentices. In recent years, we have developed the "Nationwide Academy", whichprovides structured training programmes designed to assist our team to honetheir existing skills and develop new areas of expertise. The market in which weoperate is becoming increasingly sophisticated and, in 2008, it is ourintention, with Government assistance, to extend the training areas covered bythe programme and to increase the number of staff enjoying the benefits that theAcademy offers, including apprenticeships and National VocationalQualifications. Our objective is to develop the most effective team in thesector and become the industry "employer of choice". We have made good progressin 2007 and aim to improve further this year. OperationsIn 2007 we also took the opportunity to review the sites that we operate and theareas in which they are located. In a multi-site business such as ours, suchreviews are a normal part of our business, as sites approach the end of theirleases or require additional capital investment. As a result of this review, weclosed or disposed of five sites and acquired four, in Llandudno, Lincoln,Matlock and Hull. Since the year end, we have also acquired sites in Gravesendand Scunthorpe. To support our customers' needs going forward, we are increasingour repair capacity and plan to expand in three ways:- • By increasing the throughput through our existing sites, with the employment of additional staff, introduction of shifts and extending working hours; • By acquiring additional sites in geographical areas not served by our existing network or where our existing sites are at capacity; • By enlisting and managing a secondary network of Nationwide approved repairers who carry out work on our behalf. Our Network Services Division already successfully operates this system. Network ServicesOur Network Services Division offers a comprehensive Accident Management Serviceincluding:- • First contact (known as 'first notification of loss' or 'FNOL' in the industry); • Claims handling; • Replacement vehicles; • Deployment into our own or other repair networks; • Uninsured loss recovery; • A glass replacement service; • Electronic diagnostic and air conditioning services; and • On site repair services for minor damage. In providing this service, we enjoy two key competitive advantages:- • The majority of the work is carried out within our own network, facilitating communication, efficient deployment and the ability to prioritise work; • Network Services and Nationwide Crash Repair Centres operate on a sophisticated and fully integrated in-house IT platform. This system allows us to monitor electronically and manage the flow of work through our business far more efficiently than the traditional manually operated processes. Thanks to these advantages, the division continues to demonstrate encouraginggrowth. This year we will invest in the ongoing development of our IT platformin the areas of "first contact" and claims handling, further enhancing theservices we offer our customers and the efficiency with which we manage repairs. OutlookWe have made encouraging progress during the year, improving the Group'sprofitability for the fifth consecutive year. Most significantly, we havesecured significant volumes of additional work from our existing customers andadded new contracts. The benefits of these volume improvements will be seen in2008 as these agreements are fully implemented. In the current financial year, we are continuing to expand, develop and trainour team, in order to maintain our competitive advantage. We are also increasingour capacity to repair vehicles, leveraging efficiencies at our existing sitesand looking for additional sites, where demand makes this appropriate. Inaddition, we continue to grow our Network Services Division, offering insurersand fleet operators a single point of contact and enabling us to capture workmore effectively. Our business is by nature driven by unplanned events or accidents and, as such,is "non-cyclical". This gives us a firm foundation on which we can capitalise,but equally we also look to ensure that we continue to improve operationalefficiency and that we are well placed to take advantage of marketopportunities. Looking ahead, we remain confident of our trading prospects as we continue toexecute our twin track strategy of organic and acquisitive expansion. Michael WilmshurstChief Executive NATIONWIDE ACCIDENT REPAIR SERVICES PLCCONSOLIDATED INCOME STATEMENTFor the year to 31 December 2007 2007 2006 Notes £'000 £'000 Revenue 151,947 151,192Cost of sales (81,360) (80,905) --------------------------- Gross profit 70,587 70,287 Distribution costs (38,858) (37,347)Administrative expenses (24,872) (27,063)Share option charge (240) (120) ---------------------------Operating profit before non recurring items 6,617 5,757Non recurring items 2 - (3,542) ---------------------------Operating profit 6,617 2,215Finance income 3 237 169Finance costs 3 (39) (14) ---------------------------Profit for the period before tax 6,815 2,370 Tax expense (1,744) (978) ---------------------------Net profit for the period 5,071 1,392 ---------------------------Earnings per ShareBasic 4 11.3p 3.1pDiluted 4 11.0p 3.0p --------------------------- NATIONWIDE ACCIDENT REPAIR SERVICES PLCCONSOLIDATED BALANCE SHEETAt 31 December 2007 2007 2006 Notes £'000 £'000AssetsNon-currentGoodwill 7,038 5,821Property, plant and equipment 8,100 8,933Pension and other employee assets 5 5,273 3,867 ------------------------- 20,411 18,621 -------------------------CurrentInventories 2,591 2,548Trade and other receivables 26,545 20,490Cash and cash equivalents 5,152 6,932 ------------------------- 34,288 29,970 -------------------------Total assets 54,699 48,591 -------------------------EquityEquity attributable to theshareholdersShare capital 6 5,578 5,609Capital redemption reserve 1,271 1,000Share premium account 10,864 11,104Revaluation reserve 8 8Retained earnings 7,426 4,226 -------------------------Total equity 25,147 21,947 -------------------------LiabilitiesNon-currentProvisions 125 508Deferred tax liabilities 1,002 685 ------------------------- 1,127 1,193 -------------------------CurrentProvisions 14 174Trade and other payables 27,380 24,710Current tax liabilities 1,031 567 ------------------------- 28,425 25,451 -------------------------Total liabilities 29,552 26,644 -------------------------Total equity and liabilities 54,699 48,591 ------------------------- NATIONWIDE ACCIDENT REPAIR SERVICES PLCCONSOLIDATED STATEMENT OF CHANGES IN EQUITYFor the year to 31 December 2007 Share Capital Share Reval. Retained Total Capital Redemption Premium Reserve Earnings Reserve Account £'000 £'000 £'000 £'000 £'000 £'000 Balance at 1 Jan 2006 5,609 1,000 11,104 8 2,714 20,435Income for the period - - - - 1,392 1,392 --------------------------------------------------------Total recognised income and expense for theperiod - - - - 1,392 1,392Share option charge - - - - 120 120 --------------------------------------------------------Balance at 31 Dec 2006 5,609 1,000 11,104 8 4,226 21,947 --------------------------------------------------------Income for the period - - - - 5,071 5,071 --------------------------------------------------------Total recognised income and expense for theperiod - - - - 5,071 5,071Share buyback (31) 271 (240) - (271) (271)Share option charge - - - - 240 240Dividends paid - - - - (1,840) (1,840) --------------------------------------------------------Balance at 31 Dec 2007 5,578 1,271 10,864 8 7,426 25,147 -------------------------------------------------------- NATIONWIDE ACCIDENT REPAIR SERVICES PLCCONSOLIDATED CASH FLOW STATEMENTFor the year to 31 December 2007 2007 2006 Notes £'000 £'000Operating activitiesProfit for the period before tax 6,815 2,370Adjustments 7 (296) 6,293Outflow from pension obligations (2,465) (2,860)Outflow from provisions (201) (156)Tax paid (963) (684) --------------------------- 2,890 4,963 ---------------------------Investing activitiesAdditions to property, plant and equipment (1,796) (1,653)Proceeds from the disposal of businesses 432 -Proceeds from the disposal ofproperty, plant and equipment 930 101Acquisition of businesses - cost (2,362) (762)Interest received 237 169 --------------------------- (2,559) (2,145) ---------------------------Financing activitiesDividend paid (1,840) -Purchase of own shares (271) - --------------------------- (2,111) - ---------------------------Net (decrease)/increase in cash and cash equivalents (1,780) 2,818Cash and cash equivalents at beginning of period 6,932 4,114 ---------------------------Cash and cash equivalents at end of period 5,152 6,932 --------------------------- NATIONWIDE ACCIDENT REPAIR SERVICES PLCNOTES TO THE PRELIMINARY STATEMENT 1. BASIS OF PREPARATION This preliminary statement has been prepared on the same basis and using thesame accounting policies as used in the audited financial statements for theyear ended 31 December 2006. This preliminary statement does not constitute statutory accounts as defined insection 240 of the Companies Act 1985. The figures for the year ended 31December 2006 have been extracted from the statutory financial statements whichhave been filed with the Registrar of Companies. The auditors' report on thosefinancial statements was unmodified. 2. NON RECURRING ITEMS 2007 2006 £'000 £'000Flotation costs - 683Non recurring bonuses - 2,859 ---------------------Total - 3,542 --------------------- 3. FINANCE INCOME AND FINANCE COSTS 2007 2006 £'000 £'000Finance IncomeInterest receivable on bank balances 237 169 ---------------------Finance CostsPension costs:- interest on obligation 3,786 3,262- expected return on assets (3,747) (3,248) --------------------- 39 14 --------------------- 4. EARNINGS PER SHARE Basic earnings per shareThe basic earnings per share has been calculated using the net resultsattributable to the shareholders of the Company of £5,071,000 (2006:£1,392,000). The weighted average number of outstanding shares used for thebasic earnings per share amounted to 44,864,001 (2006: 44,872,220). This numbertakes into account the share buyback that occurred on the 19th December 2007. Diluted earnings per shareThe diluted earnings per share has been calculated using the net resultsattributable to the shareholders of the Company of £5,071,000 (2006:£1,392,000). The weighted average number of outstanding shares used for thediluted earnings per share amounted to 46,108,171 (2006: 46,974,453) and assumesthe exercise of all the share options detailed in note 7 since the date theywere granted and the average market price of £1.57. This number takes intoaccount the share buyback that occurred on the 19th December 2007. Underlying earnings per share The underlying earnings per share has been calculated as follows: 2007 2006 £'000 £'000Profit before tax (as stated) 6,815 2,370Non recurring items - 3,542 ---------------------- 6,815 5,912Tax expense (as stated) (1,744) (978)Tax effect on non recurring items - (888) ---------------------- 5,071 4,046 ----------------------Adjusted earnings per share 11.3p 9.0p ---------------------- The weighted average number of outstanding shares used for the underlyingearnings per share amounted to 44,864,001 (2006: 44,872,220). This number takesinto account the share buyback that occurred on the 19th December 2007. Underlying earnings per share (IAS 19 non-corridor basis)The underlying earnings per share on an IAS 19 (non-corridor) basis has beencalculated as follows: 2007 2006 £'000 £'000Operating profit before non recurring items 7,637 6,726under IAS 19 (non-corridor)Finance income 237 169Finance costs (39) (14) --------------------Underlying Profit before tax under IAS 19 (non-corridor) 7,835 6,881Tax expense as stated (1,744) (978)Deferred tax IAS 19 (corridor) reversed 316 563Deferred tax under IAS 19 (non-corridor) (777) (853)Tax effect on non recurring items - (888) -------------------- 5,630 4,725 --------------------Adjusted earnings per share 12.5p 10.5p -------------------- The weighted average number of outstanding shares used for the underlyingearnings per share amounted to 44,864,001 (2006: 44,872,220). This number takesinto account the share buyback that occurred on the 19th December 2007. 5. PENSION AND OTHER EMPLOYEE ASSETS/OBLIGATIONS The Group operates a defined benefit scheme and a defined contribution pensionscheme in the UK which offers both pensions in retirement and death benefits tomembers. Since 1 January 2002 the defined benefit scheme has been closed to newmembers. The assets of the schemes are administered by trustees independent ofthe Group. The Company made contributions of £2,465,000 (2006: £2,860,000) tothe defined benefit scheme during the year. The defined benefit scheme wasclosed for future accruals on 31 July 2006 with active members transferred to anew defined contribution section of the scheme. In 2005 the Company agreed withthe trustees of the pension scheme to make annual contributions of approximately£2.3 million (increasing annually by the Retail Price Index) with a view toeradicating the Scheme Specific Funding deficit over a period of approximately7.5 years. The Group has opted to amortise all actuarial gains and losses above thecorridor (10% of the greater of assets and liabilities) over the future workinglifetime of the active membership. A full actuarial valuation of the defined benefit scheme was carried out as at31 December 2005 and was updated to 31 December 2007 by a qualified independentactuary. IAS 19 2007 2006 2005 % % % --------------------------The major assumptions used by the actuary were(in nominal terms):Rate of increase in salaries n/a n/a 3.3Rate of increase in pensions - accrued pre 5 April 1997 3.0 3.0 3.0Rate of increase in pensions - accrued post 5 April 1997 3.15 2.85 2.65Discount rate 6.1 5.4 5.0Inflation assumption 3.15 2.85 2.65 -------------------------- The assumptions used in determining the overall expected return of the schemehave been set with reference to yields available on government bonds andappropriate risk margins. The assets in the scheme and the expected rate of return were: 2007 2006 2005 --------------------- --------------------- ------------------- Long term Long term Long term rate of rate of rate of return Value return Value return Value expected £'000 expected £'000 expected £'000 ---------------------------------------------------------------Equities 8.5% 37,044 8.1% 34,525 8.0% 29,340Bonds 5.3% 9,664 4.8% 9,341 4.4% 9,493Property 8.5% 6,055 8.1% 6,400 8.0% 5,454Other 4.3% 1,970 3.3% 94 3.0% 232 ---------------------------------------------------------------Total market value of assets 54,733 50,360 44,519Present value of definedobligations (fundedplans) (65,040) (70,928) (65,552) ---------------------------------------------------------------Present value of unfunded obligations (10,307) (20,568) (21,033)Unrecognised actuarial losses 15,580 24,435 23,024 ---------------------------------------------------------------Net asset in balance sheet 5,273 3,867 1,991 ---------------------------------------------------------------Actual return on assets in period 3,540 4,719 5,584 --------------------------------------------------------------- Reconciliation of opening and closing balances of the present value of thedefined benefit obligations 2007 2006 2005 £'000 £'000 £'000 -----------------------------------------Benefit obligation at beginning of year 70,928 65,552 61,984Service cost - 613 1,148Interest cost 3,786 3,262 3,344Contributions by scheme members - 212 328Actuarial (gain)/loss (8,042) 3,351 323Curtailments and settlements - (611) -Benefits paid (1,632) (1,451) (1,575) -----------------------------------------Balance at end of year 65,040 70,928 65,552 ----------------------------------------- Reconciliation of opening and closing balances of the fair value of plan assets 2007 2006 2005 £'000 £'000 £'000 -----------------------------------------Fair value of scheme assets at beginning of year 50,360 44,519 37,601Expected return on scheme assets 3,747 3,248 2,471Actuarial (loss)/gain (207) 972 3,113Contributions by employers 2,465 2,860 2,581Contributions by scheme members - 212 328Benefits paid (1,632) (1,451) (1,575) -----------------------------------------Asset at end of year 54,733 50,360 44,519 ----------------------------------------- The amounts recognised in the income statement are: 2007 2006 £'000 £'000 ---------------------------------------Current service cost - 613Interest on obligation 3,786 3,262Expected return on assets (3,747) (3,248)Curtailments and settlements - (611)Actuarial loss recognised in year 1,020 969 --------------------------------------- 1,059 985 ---------------------------------------Charged to:Administration expenses 1,020 971Finance costs 39 14 --------------------------------------- 1,059 985 --------------------------------------- History of scheme assets, obligations and experience adjustments 2007 2006 2005 £'000 £'000 £'000 ------------------------------------Present value of defined benefit obligations (65,040) (70,928) (65,552)Fair value of scheme assets 54,733 50,360 44,519 ------------------------------------Deficit in scheme (10,307) (20,568) (21,033) ------------------------------------Experience adjustments arising on scheme liabilities (8,042) 3,351 323Experience item as a % of scheme liabilities (12%) 5% 0%Experience adjustments arising on scheme assets (207) 972 3,113Experience item as a % of scheme assets 0% 2% 7% ------------------------------------ Effect on profitability: comparison between IAS 19 (corridor) and IAS 19(non-corridor) 2007 2006 £'000 £'000 --------------------Operating result before non-recurring items as stated 6,617 5,757Add back actuarial loss recognised under IAS 19 (corridor) 1,020 969 --------------------Operating result before non-recurring items under IAS 19 (non-corridor) 7,637 6,726Non-recurring items - (3,542) --------------------Operating result under IAS 19 (non-corridor) 7,637 3,184Finance income 237 169Finance costs (39) (14) --------------------Profit before tax under IAS 19 (non-corridor) 7,835 3,339Tax expense as stated (1,744) (978)Deferred tax under IAS 19 (corridor) reversed 316 563Deferred tax under IAS 19 (non-corridor) (777) (853) --------------------Profit after tax under IAS 19 (non-corridor) 5,630 2,071 -------------------- Effect on total equity: comparison between IAS 19 and FRS 17 2007 2006 £'000 £'000 -----------------------------Total equity as stated under IAS 19 (non-corridor) 25,081 21,947Less IAS 19 (corridor) asset (5,273) (3,867)Add back IAS 19 (corridor) deferred tax provision 1,476 1,160IAS 19 (non-corridor) deficit (10,307) (20,568)Deferred tax asset under FRS 17 2,886 6,170 -----------------------------Total equity under FRS 17 13,863 4,842 ----------------------------- 6. EQUITY Share Capital 2007 2006 -------------------- --------------------- Shares £'000 Shares £'000 ---------------------------------------------AuthorisedOrdinary shares of 12.5p (2006: 12.5p) each 64,000,000 8,000 64,000,000 8,000 ---------------------------------------------Issued and fully paidOrdinary shares of 12.5p (2006: 12.5p) each 44,622,220 5,578 44,872,220 5,609 --------------------------------------------- On 19 December 2007, the Company purchased 250,000 of its own shares at a priceof 108p per share. Subsequent to the year end, the Company purchased a further975,000 shares on 15 January 2008 at a price of 120p per share and 450,000shares on 25 January 2008 at a price of 115p per share. All shares purchasedwill be cancelled. Share Options Number of Exercise Exercise Shares price Period -------------------------------------------M A Wilmshurst Approved 25,751 £1.165 2009-16 Unapproved 2,217,860 £1.11 2009-16D J Loftus Approved 25,751 £1.165 2009-16 Unapproved 1,096,055 £1.11 2009-16S D G Thompson Approved 25,751 £1.165 2009-16 Unapproved 871,693 £1.11 2009-16 ------------------------------------------- 4,262,861 ------------------------------------------- All the above options were issued on 4 July 2006 and no additional share optionshave been issued since this date. In total, £240k of employee compensation expense has been included in theconsolidated income statement for 2007 (2006: £120k). The corresponding creditis taken to shareholders' funds. No liabilities were recognised due toshare-based transactions. Each director has been granted two transfers of options. The first tranche isnot subject to any vesting conditions and the second tranche is subject toachievement of a Total Shareholder Return performance condition. Under bothtranches, vested options can be exercised at any time between the third andtenth anniversary of the date of the grant. 7. CASH FLOW STATEMENT The following non-cash flow adjustments have been made to the pre-tax result forthe year to arrive at operating cash flow: 2007 2006Adjustments: £'000 £'000 Movement in pension fund asset- IAS19 1,059 985Share option scheme charge 240 120Depreciation 2,225 2,407Changes in inventories (43) 219Changes in trade and other receivables (5,155) 2,949Changes in trade and other payables 2,670 (360)Changes in provisions (342) 142Profit on sale of businesses (165) -Profit on sale of property, plant and equipment (548) -Finance Income (237) (169) ---------------------Total (296) 6,293 --------------------- 8. FINANCIAL STATEMENTS The audited financial statements will be posted to shareholders on 23 April 2008and will be available from the registered office of Nationwide Accident RepairServices plc at 17A Thorney Leys Park, Witney, Oxfordshire, OX28 4GE and on theCompany's website, www.narsplc.com This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
NARS.L