16th Jun 2010 12:49
Worthington Group plc ("the Company")
Results for the Year Ended 31 March 2010
Chairman's Statement
The Company generated a profit of £230,000 (2009: loss of £11,000) excluding the non cash items relating to the pension scheme finance charge and the amounts related to associated companies, which are discussed below. Including the non cash items, the Company produced a loss after tax for the year of £316,000 (2009: £487,000).
We ended the year with cash balances of £831,000, an increase of £35,000, which is highly creditable given the payments to the pension scheme of £182,000 and the ongoing administration costs of the scheme which are picked up in the head office costs.
During the year we successfully completed two secured bridging loans utilising our cash balances for a good part of the year and generating interest and fees of £116,000 on an average sum lent of £630,000 over the two deals. We continue to look for suitable opportunities to lend always mindful of the need to preserve our capital.
I am pleased to report a slight increase in rental receipts during the year to £147,000 (2009: £142,000) which compared favourably with the £150,000 budget set against a challenging economic background. Overall we produced surplus rental income of £135,000 (2009: £59,000) after much reduced maintenance costs in the year. Head office costs as a whole also reduced in the year although this was largely due to the release of some provisions from earlier years which were no longer deemed necessary.
We are investigating various planning schemes for the site at Keighley to realise the maximum value out of the site. A public consultation in Keighley was completed at the end of April 2010 which proposed the building of a new health centre on our land which whilst zoned for industrial use nevertheless sits within a large residential area. The alternative was to rebuild a new centre on the existing site. We still await the outcome of the consultation and if our site is selected it is likely we would enter negotiations to sell the spare land whilst retaining the buildings which are currently being rented. We anticipate moving forward with some sort of planning application for the site in the coming year dependent on the outcome of the consultation.
Turning to the pension scheme, the income statement, in accordance with IAS 19, includes a non cash charge of £242,000 (2009: £166,000) in respect of the pension scheme net finance cost. Payments into the scheme to reduce the deficit during the period amounted to £182,000 (2009: £223,000) but despite this the scheme deficit on an IAS 19 basis increased to £3,240,000 (2009: £2,641,000).
The pension scheme funding risk continues to represent the principal risk factor faced by the Company. The tri-annual full actuarial review of the scheme as at 5 April 2010 is currently being prepared by the scheme actuaries, the results of which will be known in the next few months. We are however mindful that the review may well revise mortality rates upwards since the last review in 2007 which may have a consequential impact on the scheme deficit.
The investment performance of the scheme assets against benchmarks together with the levels of head office costs and the rental income continue to be monitored closely by the Board as key performance indicators.
Trimmings by Design ("Trimmings"), in which we have a 44% shareholding, produced another loss for the year, with our share of the trading losses included in these accounts amounting to £79,000 (2009: £56,000). Actions have been taken by management, to reduce staff costs in particular, but we feel there is more that could be done. Whilst the budget for this year has forecast a near breakeven position we have had to review the carrying value of the investment given a lack of dividends and have accordingly made an impairment provision of £225,000 against the value of the investment on our statement of financial position. All these items are non cash items.
Accordingly net asset value has decreased by £855,000 in the year to £232,000 (2009: £1,087,000) once again principally as a result of the rise in the pension scheme deficit of £599,000. A substantial recovery in the scheme assets during the year was unfortunately more than offset by the effect of changes in discount rates on the scheme liabilities.
We continue to look for ways to reduce the Company's exposure going forward to the pension scheme but it is likely that this can only be addressed when we have found a suitable acquisition opportunity which we continue to seek.
J C Dwek CBE
Executive Chairman
16 June 2010
Worthington Group plc
Income Statement
for the year ended 31 March 2010
2010 2009
Note £'000 £'000
Revenue 2 147 142
Cost of sales (12) (83)
______ ______
Gross profit 135 59
Administrative expenses (74) (149)
______ ______
Operating profit / (loss) 61 (90)
Investment revenues 3 169 79
Finance costs 4 (242) (166)
Share of results of associate (79) (56)
Provision for impairment losses 5 (225) (254)
______ ______
Loss before taxation (316) (487)
Taxation 6 - -
______ ______
Loss after taxation for current year (316) (487)
______ ______
Loss per ordinary share from continuing operations
- Basic 7 (2.7p) (4.1p)
- Fully diluted 7 n/a n/a
All items are derived from continuing operations.
Worthington Group plc
Statement of Comprehensive Income
For the year ended 31 March 2010
2010 2009
£'000 £'000
Loss for the year (316) (487)
Actuarial loss on retirement benefit obligation (539) (1,779)
______ ______
Total comprehensive loss for the period (855) (2,266)
______ ______
Attributable to:
Owners of the parent (855) (2,266)
______ ______
Worthington Group plc
Statement of Financial Position
At 31 March 2010
2010 2010 2009 2009
£'000 £'000 £'000 £'000
Non-current assets
Investment property 1,800 1,800
Interests in associates 125 429
Other financial assets 800 800
_____ _____
2,725 3,029
Current assets
Trade and other receivables 15 85
Cash and bank balances 831 796
_____ _____
846 881
______ _____
Total assets 3,571 3,910
Current liabilities
Trade and other payables 99 182
_____ _____
Non-current liabilities
Retirement benefit obligation 3,240 2,641
_____ _____
3,240 2,641
_____ _____
Total liabilties (3,339) (2,823)
______ ______
Net assets 232 1,087
______ _____
Equity
Called-up share capital 11,807 11,807
Share premium account 9,836 9,836
Retained earnings (21,411) (20,556)
______ ______
Total equity 232 1,087
______ ______
Worthington Group plc
Statement of Changes in Equity
for the year ended 31 March 2010
Share Share Retained
capital premium earnings Total
£'000 £'000 £'000 £'000
At 1 April 2009 11,807 9,836 (20,556) 1,087
Total comprehensive income for the year - - (855) (855)
______ ______ ______ ______
At 31 March 2010 11,807 9,836 (21,411) 232
______ ______ ______ ______
Share Share Retained
capital premium earnings Total
£'000 £'000 £'000 £'000
At 1 April 2008 11,807 9,836 (18,290) 3,353
Total comprehensive income for the year - - (2,266) (2,266)
______ ______ ______ ______
At 31 March 2009 11,807 9,836 (20,556) 1,087 ______ ______ ______ ______
Worthington Group plc
Cash Flow Statement
for the year ended 31 March 2010
2010 2009
£'000 £'000
Cash flow from operating activities
Operating profit / (loss) 61 (90)
Movement in trade and other receivables 70 (40)
Movement in trade and other payables excluding pension obligation (83) 17
Payments to pension scheme (182) (223)
_____ _____
Net cash outflow from operating activities (134) (336)
Cash flow from investing activities
Interest received 169 66
Dividends received from associated undertakings - 66
_____ _____
Net cash generated by investing activities 169 132
_____ _____
Increase/(decrease) in cash and cash equivalents 35 (204)
Cash and cash equivalents at beginning of year 796 1,000
_____ _____
Cash and cash equivalents at end of year 831 796
_____ _____
Cash and cash equivalents comprise of cash held at bank.
Worthington Group plc
Notes forming part of the preliminary announcement for the year ended 31 March 2010
1. Basis of preparation
The financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union.
The financial information in this announcement, which was approved by the Board of Directors on 16 June 2010, does not constitute the Company's statutory accounts for the years ended 31 March 2010 or 2009, but is derived from these accounts.
Statutory accounts to 31 March 2009 have been delivered to the Registrar of Companies and those for 2010 will be delivered following the Company's annual general meeting. The auditors have reported on these accounts; their reports were unqualified and did not contain statements under S498 of the Companies Act 2006.
The financial information has been prepared on the historical cost basis, except for the revaluation of certain properties and assets.
2. Segmental Analysis
The Company has adopted IFRS 8 with effect from 01 April 2009. IFRS 8 requires operating segments to be identified on the basis of internal reports about components of the Company that are regularly reviewed by the Chief Executive to allocate resources and assess performance.
As a result, following the adoption of IFRS 8, the Company's only reportable segment remains property rental and management in the UK.
Included in revenues arising from the Company's only operating segment are revenues of approximately £135,000 which arose from the Company's three largest customers being £98,000, £22,000 and £15,000 respectively.
3. Investment Revenues
2010 2009
£'000 £'000
Loan note interest 52 52
Interest and arrangement fees on bridging loans 116 -
Interest on bank deposits 1 27
____ ____
169 79
____ ____
4. Finance Costs
2010 2009
£'000 £'000
Pension scheme net finance charge 242 166
____ ____
5. Impairment losses recognised
2010 2009
£'000 £'000
Goodwill written off - 145
Provision against goodwill in balance sheet of associate - 109
Provision for impairment losses 225 -
____ ____
225 254
____ ____
Following losses made in the current year by Trimmings by Design Ltd and a budgeted loss for the 2010/11 year the Directors consider there has been an impairment of the investment recognised in the Company's statement of financial position. Accordingly a provision has been made against the carrying value of the investment of £225,000 in respect of its associate with a corresponding charge to the income statement.
6. Taxation
No corporation charge has been provided for 2010 or 2009 as a result of the availability of various reliefs.
7. Earnings per share
The earnings per share has been calculated using the weighted average number of shares in issue during the relevant financial periods. The weighted average number of shares in issue during the year was 11,807,013 (2009: 11,807,013) and the loss after taxation was £316,000 (2009: £487,000).
There is no difference between the basic and diluted loss per share in either year.
8. Copies of the Annual Report
Copies of the Annual Report are available from the Company Secretary at the registered office which is situated at Suite 1, Courthill House, 66 Water Lane, Wilmslow, Cheshire, SK9 5AP. The annual report and AGM notices will also be available for download on the Company's website www.worthingtongroupplc.co.uk
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Enquiries: |
Worthington Group plc
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Joe Dwek CBE, Chairman |
Tel: 01625 549082 |
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David Shalom , Finance Director |
Tel: 07912 777470 |
Related Shares:
Worthington Grp