28th Apr 2015 07:00
Armour Group plc
(AIM: AMR)
Unaudited Interim Statement
For the six months to 28 February 2015
The Company remains an investing company and continues to look at a number of opportunities. The Company did not trade in the six month period.
For further information please contact:
Armour Group plc Tel: 01634 673172
Mark Wilson, Finance Director
FinnCap, Nominated Adviser and Broker Tel: 0207 220 0500
Geoff Nash (Corporate Finance)
Stephen Norcross (Broking)
Unaudited Interim Statement
For the six months to 28 February 2015
Corporate activity
The Company has been an investing company since August 2014 and accordingly has continued to reduce its operating costs. The Tunbridge Wells head office was closed in December 2014.
As previously announced, in December 2014, I was required under Rule 9 of the City Code to make a general offer for those shares in Armour that I (and persons deemed to be acting in concert with me) did not already own. This offer period ended on 20 February 2015. Hawk Investment Holdings Limited now owns 47.9% of the issued share capital of the Company, whilst the concert party together owns 64.6%.
The Company was granted a court order on 18 February 2015 to perform a capital reduction, by cancellation of the share premium account and the deferred shares of 9 pence each. The effect of this capital reduction is set out in Consolidated Statement of Changes in Shareholder Equity.
Outlook
The Company continues to seek opportunities that will enhance shareholder capital growth and income. The Company's objective is to generate an attractive rate of return for shareholders by taking advantage of these opportunities.
Bob Morton
Chairman
28 April 2015
CONSOLIDATEDSTATEMENT OF COMPREHENSIVE INCOME
For the six months to 28 February 2015
|
Notes | Six months to 28 February 2015 (unaudited) £000 | Six months to 28 February 2014 (unaudited) £000 | Twelve months to 31 August 2014
£000 |
|
|
|
|
|
|
|
|
|
|
Revenue | 2 | - | 16,563 | - |
(Loss)/profit from operations before exceptional operations | 2 | (242) | 79 | (725) |
Exceptional Items | 4 | - | - | (214) |
Total (loss)/profit from operations |
| (242) | 79 | (939) |
Finance income |
| 67 | - | 20 |
Finance expense |
| - | (281) | (150) |
Share of post-tax losses of equity accounted associate |
| (32) | - | (70) |
Loss before taxation |
| (207) | (202) | (1,139) |
Taxation credit | 3 | - | 44 | 11 |
Loss for the financial period |
| (207) | (158) | (1,128) |
Loss from discontinued operations, net of tax | 5 | - | - | (10,071) |
Total loss for the financial period |
| (207) | (158) | (11,199) |
Other comprehensive income |
|
|
|
|
Exchange (loss)/gain arising on translation of foreign operations |
| - | (38) | (144) |
Total comprehensive loss |
| (207) | (196) | (11,343) |
|
|
|
|
|
|
|
|
|
|
Loss per ordinary share | 6 |
|
|
|
Basic |
| (0.22) | (0.17)p | (11.96)p |
Diluted |
| (0.22) | (0.17)p | (11.96)p |
|
|
|
|
|
CONSOLIDATEDSTATEMENT OF FINANCIAL POSITION
At 28 February 2015
|
| 28 February 2015 (unaudited) £000 | 28 February 2014 (unaudited) £000 | 31 August 2014
£000 |
|
|
|
|
|
Non-current assets |
|
|
|
|
Goodwill |
| - | 12,084 | - |
Other intangible assets |
| - | 2,778 | - |
Property, plant and equipment |
| - | 698 | 1 |
Investment in associate |
| 827 | - | 859 |
Loan |
| 1,000 | - | 1,000 |
Deferred taxation asset |
| 6 | 675 | 6 |
Total non-current assets |
| 1,833 | 16,235 | 1,866 |
|
|
|
|
|
Current assets |
|
|
|
|
Inventories |
| - | 7,481 | - |
Trade and other receivables |
| 11 | 6,063 | 60 |
Corporation tax asset |
| - | 93 | - |
Cash and cash equivalents |
| 3,711 | 326 | 4,070 |
Total current assets |
| 3,722 | 13,963 | 4,130 |
Total assets |
| 5,555 | 30,198 | 5,996 |
|
|
|
|
|
Current liabilities |
|
|
|
|
Loans and borrowings |
| - | (8,084) | - |
Trade and other payables |
| (181) | (5,202) | (415) |
Corporation taxation liability |
| - | (12) | - |
Provisions |
| - | (48) | - |
Total current liabilities |
| (181) | (13,346) | (415) |
|
|
|
|
|
Non-current liabilities |
|
|
|
|
Provisions |
| - | (53) | - |
Deferred taxation liability |
| - | (71) | - |
Total non-current liabilities |
| - | (124) | - |
Total liabilities |
| (181) | (13,470) | (415) |
Total net assets |
| 5,374 | 16,728 | 5,581 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
Share capital |
| 971 | 7,134 | 7,134 |
Share premium |
| - | 10,084 | 10,084 |
Other reserves |
| - | 871 | - |
Retained earnings |
| 4,975 | (895) | (11,065) |
Translation reserve |
| - | 106 | - |
Share trust reserve |
| (572) | (572) | (572) |
Total equity |
| 5,374 | 16,728 | 5,581 |
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
For the six months to 28 February 2015 (unaudited)
| Share capital | Share premium | Retained earnings | Share trust reserve | Total equity |
| £000 | £000 | £000 | £000 | £000 |
At 1 September 2014 | 7,134 | 10,084 | (11,065) | (572) | 5,581 |
Total comprehensive loss | - | - | (207) | - | (207) |
Capital restructuring | - | (10,084) | 10,084 | - | - |
Cancellation of deferred shares | (6,163) | - | 6,163 | - | - |
At 28 February 2015 | 971 | - | 4,975 | (572) | 5,374 |
For the six months to 28 February 2014 (unaudited)
| Share capital | Share premium | Other reserves | Retained earnings | Translation reserve | Share trust reserve | Total equity |
| £000 | £000 | £000 | £000 | £000 | £000 | £000 |
At 1 September 2013 | 7,134 | 10,084 | 871 | (737) | 144 | (572) | 16,924 |
Total comprehensive loss | - | - | - | (158) | (38) | - | (196) |
At 28 February 2014 | 7,134 | 10,084 | 871 | (895) | 106 | (572) | 16,728 |
For the twelve months ended 31 August 2014
| Share capital | Share premium | Other reserves | Retained earnings | Translation reserve | Share trust reserve | Total equity |
| £000 | £000 | £000 | £000 | £000 | £000 | £000 |
At 1 September 2013 | 7,134 | 10,084 | 871 | (737) | 144 | (572) | 16,924 |
Total comprehensive loss | - | - | - | (11,199) | - | - | (11,199) |
Other comprehensive expense | - | - | - | - | (144) | - | (144) |
Discontinued operations | - | - | (871) | 871 | - | - | - |
At 31 August 2014 | 7,134 | 10,084 | - | (11,065) | - | (572) | 5,581 |
CONSOLIDATEDSTATEMENT OF CASH FLOWS
For the six months to 28 February 2015
|
Notes | Six months to 28 February 2015 (Unaudited) £000 | Six months to 28 February 2014 (Unaudited) £000 | Twelve months to 31 August 2014
£000 |
|
|
|
|
|
Cash flow from operating activities |
|
|
|
|
Cash (utilised in)/generated from operations | 8 | (426) | 627 | 87 |
Income taxes recovered by discontinued operations |
| - | 180 | 272 |
Net cash (outflow)/inflow from operating activities |
| (426) | 807 | 359 |
|
|
|
|
|
Investing activities |
|
|
|
|
Purchase of property, plant and equipment |
| - | (123) | (206) |
Sale of property, plant and equipment |
| - | 1 | 9 |
New loans issued |
| - | - | (1,000) |
Proceeds on disposal of discontinued operations |
| - | - | 11,226 |
Costs of disposal of discontinued operations |
| - | - | (822) |
Expenditure on intangible assets |
| - | (475) | (797) |
Interest received |
| 67 | - | 17 |
Net cash generated from/(used in) investing activities |
| 67 | (597) | 8,427 |
|
|
|
|
|
Financing activities |
|
|
|
|
New loans taken out |
| - | 297 | - |
Repayment of loans |
| - | (28) | (4,499) |
Interest paid |
| - | (246) | (348) |
Net cash arising from/(used in) financing activities |
| - | 23 | (4.847) |
|
|
|
|
|
Net (decrease)/increase in cash, cash equivalents and bank overdrafts | 9 | (359) | 233 | 3,939 |
Currency variations |
| - | (38) | - |
Cash, cash equivalents and bank overdrafts at the start of the period |
| 4,070 | 131 | 131 |
Cash, cash equivalents and bank overdrafts at the end of the period |
| 3,711 | 326 | 4,070 |
Notes to the Interim Financial Statements
1. Basis of Preparation
These interim financial statements have been prepared using the recognition and measurement principles of International Accounting Standards, International Financial Reporting Standards and Interpretations adopted for use in the European Union (collectively "Adopted IFRS").
The principal accounting policies used in preparing these interim financial statements are those expected to apply to the Group's Consolidated Financial Statements for the year ending 31 August 2015 and are unchanged from those disclosed in the Group's Annual Report for the year ended 31 August 2014. The financial information for the six months ended 28 February 2015 and 28 February 2014 is unaudited and does not constitute statutory financial statements for those periods.
The comparative financial information for the twelve months ended 31 August 2014 has been derived from the audited statutory financial statements for that year. These financial statements were approved by shareholders at the Annual General Meeting and have been delivered to the Registrar of Companies. The Auditors' Report on those financial statements was unqualified, did not include a reference to any matters to which the Auditors drew attention by way of emphasis without qualifying their report and did not include a statement under section 498(2) or 498(3) of the Companies Act 2006.
The Board of Directors approved this interim report on 27 April 2015.
2. Business Segments
During the prior year the group operated in the following main business segments:
Armour Automotive: The design, manufacture and supply of products for the in-vehicle communications and entertainment market, this segment was disposed of on 31 March 2015;
Armour Home: The design, manufacture and supply of products into the Hi-Fi, home theatre, home entertainment and office furniture markets, this segment was disposed of on 4 August 2014;
Armour Asia: The sale of Armour Automotive and Armour Home products into Asian markets and provision of supplier support services, including quality control, to the UK businesses, this segment was disposed of on 4 August 2014;
Central operations: The provision of Group-wide support services including finance and future product concepts to the other business segments within the Group.
For the six months to 28 February 2015 (Unaudited) |
|
|
| Central operations £000 |
Total £000 |
Underlying (loss) for the period |
|
|
| (242) | (242) |
|
|
|
|
|
|
Depreciation |
|
|
| 1 | 1 |
For the six months to 28 February 2014 (Unaudited) | Armour Automotive £000 | Armour Home £000 | Armour Asia £000 | Central operations £000 |
Total £000 |
Revenue | 7,515 | 8,487 | 561 | - | 16,563 |
Underlying profit/(loss) for the period | 711 | 15 | (129) | (518) | 79 |
|
|
|
|
|
|
Additions to non-current assets | 218 | 377 | 3 | - | 598 |
Depreciation | 27 | 101 | 4 | 1 | 133 |
Amortisation of intangible assets | 71 | 228 | - | - | 299 |
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|
For the twelve months to 31 August 2014 | Armour Automotive £000 | Armour Home £000 | Armour Asia £000 | Central operations £000 |
Total £000 |
Continuing operations |
|
|
|
|
|
Revenue | - | - | - | - | - |
Loss from operations | - | - | - | (939) | (939) |
|
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|
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|
|
Discontinued operations |
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|
|
|
|
Revenue | 8,915 | 14,987 | 1,154 | - | 25,056 |
Profit/(loss) from discontinued operations net of tax | 3,524 | (13,550) | (45) | - | (10,071) |
|
| Six months to 28 February 2015 (Unaudited) £000 | Six months to 28 February 2014 (Unaudited) £000 | Twelve months to 31 August 2014
£000 |
Revenue by location of customers |
|
|
|
|
United Kingdom |
| - | 10,327 | 15,668 |
Sweden |
| - | 1,153 | 1,491 |
France |
| - | 868 | 1,111 |
Italy |
| - | 637 | 763 |
Germany |
| - | 305 | 453 |
Denmark |
| - | 182 | 233 |
Hong Kong |
| - | 29 | 53 |
Other countries |
| - | 3,062 | 5,284 |
Total |
| - | 16,563 | 25,056 |
3. Taxation
No taxation charge/credit has been recognised for the six months to 28 February 2015, this will be assessed at the year end, and will be based on the effective taxation rate, which is estimated will apply for the year ending 31 August 2015.
4. Exceptional Items
Exceptional items in the prior year relate to the redundancy costs at Head Office following the sale of the Armour Automotive division. The exceptional costs incurred are shown below:
|
| Six months to 28 February 2015 (Unaudited) £000 | Six months to 28 February 2014 (Unaudited) £000 | Twelve months to 31 August 2014
£000 |
Redundancy costs |
| - | - | 214 |
Total exceptional costs |
| - | - | 214 |
5. Discontinued Operations
During the prior year the Group disposed of both of its trading divisions: Armour Automotive was sold on 31 March 2014 and Armour Home on 4 August 2014. The post-tax loss of discontinued operations was determined as follows:
|
| Six months to 28 February 2015 (Unaudited) £000 | Six months to 28 February 2014 (Unaudited) £000 | Twelve months to 31 August 2014
£000 |
Revenue |
| - | - | 25,056 |
Expenses other than finance costs |
| - | - | (24,699) |
Finance costs |
| - | - | (232) |
Tax expense |
| - | - | (108) |
Net asset value of associate |
| - | - | 929 |
Loss from selling discontinued operations after tax |
| - | - | (11,017) |
|
| - | - | (10,071) |
6. Loss per Ordinary Share
The basic loss per ordinary share is calculated using the weighted average number of ordinary shares in issue during the financial period of 93,627,496 (28 February 2014 and 31 August 2014: 93,627,496).
The diluted loss per ordinary share is calculated using the weighted average number of ordinary shares in issue during the financial period of 93,627,496 (28 February 2014 and 31 August 2014: 93,627,496). The effect of the exercise of options on the weighted average number of ordinary shares in issue is nil for all periods.
The weighted average number of ordinary shares held by the Armour Employees' Share Trust of 3,424,000 (28 February 2014 and 31 August 2014: 3,424,000) are not included in either the weighted average, or diluted weighted average, ordinary shares in issue during the financial period.
| Six months to 28 February 2015 (Unaudited) | Six months to 28 February 2014 (Unaudited) | Twelve months to 31 August 2014
| |||
| £000 | p | £000 | p | £000 | p |
Basic loss per ordinary share |
|
|
|
|
|
|
Loss for the financial period | (207) | (0.22) | (158) | (0.17) | (11,199) | (11.96) |
Discontinued operations net of tax | - | - | - | - | 10,071 | 10.76 |
Continuing operations | (207) | (0.22) | (158) | (0.17) | (1,128) | (1.20) |
Exceptional Items | - | - | - | - | 214 | 0.23 |
Underlying loss | (207) | (0.22) | (158) | (0.17) | (914) | (0.97) |
| Six months to 28 February 2015 (Unaudited) | Six months to 28 February 2014 (Unaudited) | Twelve months to 31 August 2014
| |||
| £000 | p | £000 | p | £000 | p |
Diluted loss per ordinary share |
|
|
|
|
|
|
Loss for the financial period | (207) | (0.22) | (158) | (0.17) | (11,199) | (11.96) |
Discontinued operations net of tax | - | - | - | - | 10,071 | 10.76 |
Continuing operations | (207) | (0.22) | (158) | (0.17) | (1,128) | (1.20) |
Exceptional Items | - | - | - | - | 214 | 0.23 |
Underlying loss | (207) | (0.22) | (158) | (0.17) | (914) | (0.97) |
7. Share Capital
At the Company's Annual General Meeting held on 8 December 2014, resolutions were passed to allow the company to obtain court approval to cancel the deferred shares and the share premium account. Court approval was given on 18 February 2015.
Movements in issued share capital
|
|
| Ordinary shares of 1p each (Unaudited) Number '000 | Deferred shares of 9p each (Unaudited) Number '000 |
In issue at 1 September 2014 |
|
| 97,051 | 68,480 |
Court approved cancellation of deferred shares |
|
| - | (68,480) |
In issue at 28 February 2015 |
|
| 97,051 | - |
|
|
| Ordinary shares of 1p each (Unaudited) £000 | Deferred shares of 9p each (Unaudited) £000 |
In issue at 1 September 2014 |
|
| 971 | 6,163 |
Court approved cancellation of deferred shares |
|
| - | (6,163) |
In issue at 28 February 2015 |
|
| 971 | - |
8. Net Cash from Operations
| Six months to 28 February 2015 (Unaudited) £000 | Six months to 28 February 2014 (Unaudited) £000 | Twelve months to 31 August 2014
£000 |
|
|
|
|
(Loss) for the period | (207) | (158) | (11,199) |
Depreciation of property, plant and equipment | 1 | 133 | 1 |
Amortisation of intangible assets | - | 299 | - |
Depreciation, amortisation, finance expense and tax relating to discontinued operations | - | - | 1,102 |
Loss on disposal of subsidiary undertakings | - | - | 10,071 |
Share of post-tax losses of associate | 32 | - | 70 |
Finance income | (67) | - | (20) |
Finance expense | - | 281 | 150 |
Income tax credit | - | (44) | (11) |
EBITDA* | (241) | 511 | 164 |
Loss on sale of property, plant and equipment |
| - | - |
Decrease in inventories | - | 476 | - |
Decrease/(increase) in trade and other receivables | 49 | 640 | (25) |
Decrease in trade, other payables and provisions | (234) | (1,000) | (52) |
| (185) | 116 | (77) |
Cash (utilised in)/generated from operations | (426) | 627 | 87 |
*EBITDA is defined as (loss)/profit before interest, taxation, depreciation and amortisation.
9. Reconciliation of Net Cash Flow to Movement in Net Cash/(Debt)
Net debt incorporates the Group's loans, borrowings and bank overdrafts less cash and cash equivalents. A reconciliation of the movement in the net debt is shown below:
| Six months to 28 February 2015 (Unaudited) £000 | Six months to 28 February 2014 (Unaudited) £000 | Twelve months to 31 August 2014
£000 |
|
|
|
|
Net (decrease)/increase in cash and cash equivalents | (359) | 233 | 3,939 |
New loans | - | (297) | - |
Repayment of loans | - | 28 | 4,499 |
Other non-cash movements | - | (73) | 3,281 |
(Decrease)/increase in net cash/(debt) in the financial period | (359) | (109) | 11,719 |
Opening net cash/(debt) | 4,070 | (7,649) | (7,649) |
Closing net cash/(debt) | 3,711 | (7,758) | 4,070 |
10. Copies of Interim Report
A copy of this interim report can be viewed on the Group's website: www.armourgroup.uk.com and will be made available upon request at the Company's Registered Office, Suite 25, 6-8 Revenge Road, Lordswood, Chatham, Kent, ME5 8UD.
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