Aukett Swanke Regulatory News (AUK)

22 Jan 2007 07:01

Aukett Fitzroy Robinson Group PLC22 January 2007 22 January 2007 AUKETT FITZROY ROBINSON GROUP PLC 2006 PRELIMINARY RESULTS ANNOUNCEMENT Aukett Fitzroy Robinson Group Plc ("Aukett Fitzroy Robinson"), the internationalgroup of architects and designers, announces its preliminary results for thetwelve months ended 30 September 2006. Aukett Fitzroy Robinson providescreative design, commercial awareness and efficient delivery of high qualityprojects; with specific expertise in offices, retail, interiors, hotels,transportation, laboratories, residential, urban and landscape design,industrial, historic buildings, mixed-use and leisure facilities. Financial HighlightsTwelve months ended 30 September 2006 2005 unaudited audited • Group turnover (£000) 16,284 12,611 • Operating profit (£000) 840 236 • Profit before tax (£000) 786 159 • Earnings per share (pence) 0.45 0.02 Key Points of Statement: * Major profits recovery backed by strong cash flow* Net debt reduced by £1.2m in twelve months* Strengthened both UK and European structures* UK market for commercial architectural services buoyant* In overseas markets, Russia continues to outperform expectations* Strong order book for both 2006/07 and 2007/08 CEO Nicholas Thompson said: "I see the future of the Company as extremely encouraging with opportunities forfurther improvements in operating efficiency through off-shoring of work to ourEuropean network; development of income growth through the winning of largerproject commissions and enhanced shareholder value through a more active mergerand acquisitions programme. Over the next twelve months, we expect the Companyto improve upon its current year's performance." Enquiries: Aukett Fitzroy Robinson Group Plc www.aukettfitzroyrobinson.com Nicholas Thompson, CEO Tel: 020 7636 8033Peter Binns, Adventis Tel: 020 7034 4760Sam Smith, JM Finn & Co - Corporate Finance Tel: 020 7997 8352Ed Frisby, JM Finn & Co - Corporate Finance Tel: 020 7997 8413Leslie Kent, JM Finn & Co - Specialist Sales Tel: 020 7997 8324 AUKETT FITZROY ROBINSON GROUP PLC Preliminary Statement for the twelve months ended 30 September 2006 Introduction The past twelve months have seen the Company make significant progress towardsrestoring its financial and market position. There has been much to celebrateboth in terms of rising profitability and reduction in net debt, combined with aplethora of contract gains and a number of architectural awards. Financial Overview The group achieved a profit before tax of £0.79m (2005: £0.16m) on turnover of£16.28m (2005: £12.61m). I commented in the last Annual Report about theimplementation of a more consistent contract appointment and invoicing regimealong with a more focused debtor recovery programme. This has demonstrablyborne fruit with the Group net debt position improving in advance of profit andreducing by £1.20m to £0.18m. Review of operations The UK market for commercial architectural services is buoyant with strongdemand in most sectors in which we operate. This has led to an industry widetightening of resource available in the market. We believe that we are winning more than our share of available projectopportunities and, in certain areas, building up a more dominant marketposition. We do continue to closely monitor our staffing requirements andreallocate staff according to project and sector needs. This flexibility,together with the strength of the brand for attracting talented staff, hasensured that we have been able to successfully manage our resourcing commitmentsas our income has grown. Our Commercial Office and Hotel sector groups have shown particularly strongperformance, reflecting the specific skills that we offer clients. CommercialOffices have won a number of significant contracts from major developers, whichhas secured their workload for the next few years. Likewise, the Hotels teamhas secured a number of commissions for new hotels from existing high-profilehotel operators and several one-off development opportunities at the top end ofthe market. In order to consolidate our position in the luxury hotel market, wehave recently strengthened our team at director level, having taken on a keyindividual from one of our main competitors. Our Transport and Retail teams have widened their client contacts and are,accordingly, starting to build their teams to service secured work. We believethat both of these sectors have the potential to grow over the next financialperiod. Executive Architecture services (trading under the name Veretec), has started tomake significant progress in its development as a unique business offering andforms an important strand in our future growth strategy. It now works with anumber of the major UK contractors within a specialised part of thearchitectural services market to take outline building plans and develop theminto specialised drawings that the contractor can use. During the year we have opened a new office in Southampton to focus uponresidential and mixed-use schemes which are continuing to be developed along theSouth coast. This has been positively received by our clients and the office hasreceived a number of enquiries which are now converting into larger projects.Likewise, our Bristol office is performing strongly; having secured not only aprestigious scheme for a major office development in the St Mary le Port area ofBristol but also a partial redevelopment of Dorchester Town Centre and a new HQbuilding in central Bristol. In our overseas markets, Russia continues to outperform our expectations. Wenow have eight signed contracts in progress with a combined contract value ofapproximately $700m upon which we should earn stage fees of $6m over the nextfew years. These projects cover circa 4.3 million sq. ft. of commercialdevelopment space. The Czech operation performed well in a competitive marketand has reacted positively to the country's recent growth in GDP with newenquiries continuing to be received. Poland has suffered from a shortage ofcommercial office opportunities but continues to be of strategic importance tothe Group. We intend to combine the management and design skills of these threeoffices to improve the skill set we can offer our clients in the emergingmarkets of Eastern Europe. Berlin had a difficult year due to local economic factors. However, Frankfurthas benefited from a successful period of fit-out contracts, recording its bestresult to date. We disposed of our Rotterdam subsidiary in December 2005 byselling our interest to our local partner. During the year we achieved formal recognition of our design capability bywinning the 2005 BCO National and Regional Award for the National Air TrafficControl Centre at Southampton and a 2005 Regional Award for South CambridgeshireDistrict Council's new offices at Cambourne. In addition, the Grove Hotel inHertfordshire won an award from Conde Nast Traveller for the 2005 Best UK SpaRetreat. We have launched a knowledge-based initiative to bring a fresh approach to arange of topical subjects facing our clients and disseminate some of theexperience that we have built up. This started with a seminar to interestedparties on sustainable development, focusing on our hugely successful design foran ecological warehouse in Norfolk for Adnams brewers. This project is one ofonly 22 industrial projects in the UK to achieve a BREEAM (Building ResearchEstablishment Environmental Assessment Method) 'Excellent' rating and brings ourtotal buildings with such a rating to 12. We have followed this up with 'Aheadof Time', a research initiative into development opportunities in the areabetween the City and new Olympic development site which will benefit from newinfrastructure projects. Further details of both matters are on our website. Corporate Strategy In last year's report I set out the Company's medium term objective of doublingits turnover to £25m within five years. Having now had time to properly assessthe growth potential for our various business sectors and overseas operations,we believe that this is achievable though organic growth and strategicdevelopment of our existing operations with a minimum of merger and acquisitionactivity. However, the market for architectural services is becoming more concentrated asprojects become larger and the ability to resource and deliver major schemes isseen as an underlying necessity, thereby requiring architectural practices to beof a certain scale. As such, we see numerous opportunities to sustainablyextend our business through a series of strategic mergers and acquisitions.These will focus not only on areas of existing expertise but, more importantly,will target operations that will either enable the business to achieve animproved geographical spread or to expand into an allied key growth market. Along list of potential opportunities is being compiled and appropriate resourceswill be made available to develop the more promising candidates further. Finally, our move to AIM has been a success and, with the rising fortunes of theCompany, our share price has responded accordingly, increasing from a low of2.38p in January 2006 to high of 17.875p on 9 January 2007. Summary I see the future of the Company as extremely encouraging with opportunities forfurther improvements in operating efficiency through off-shoring of work to ourEuropean network; development of income growth through the winning of largerproject commissions and enhanced shareholder value through a more active mergerand acquisitions programme. Over the next twelve months, we expect the Companyto improve upon its current year's performance. All of this, of course, is only achieved with our Unique Selling Point - thestaff - whose dedication, skill and commitment make all of this possible. Nicholas Thompson Chief Executive Officer 22 January 2007 Aukett Fitzroy Robinson Group Plc 14 Devonshire Street London W1G 7AE Consolidated profit and loss accountFor the twelve months ended 30 September 2006 Year ended Year ended 30 September 2006 30 September 2005 unaudited audited £000 £000 Gross turnover: Group and share of joint ventures 16,677 12,818Less share of joint ventures (393) (207) ------ ------Group turnover 16,284 12,611 ------ ------ Group operating profit 840 236 Share of operating profit in joint ventures and associate 83 25Exceptional charge: (Loss)/profit on disposal of subsidiary and joint ventures (15) 23 ----- ----- Profit on ordinary activities before interest 908 284 19Interest receivable 44 (144)Interest payable (166) ----- -----Profit on ordinary activities before tax (note 3) 786 159 Tax charge on profit on ordinary activities (note 4) (137) (136) ----- -----Retained profit of the Group 649 23 ===== =====Earnings per share (note 5):Basic 0.45p 0.02pDiluted 0.45p 0.02p Summarised consolidated balance sheet At 30 September 2006 30 September 2006 30 September 2005 unaudited audited (as restated) £000 £000 Fixed assetsIntangible assets 1,596 1,647Tangible assets 322 350Investment in joint venture 19 -Investment in associate 6 31 ----- ----- 1,943 2,028Current assetsDebtors 6,432 6,064Cash at bank and in hand 1,341 1,158 ----- ----- 7,773 7,222Creditors falling due within one year (5,588) (5,600) ----- -----Net current assets 2,185 1,622 ----- -----Total assets less current liabilities 4,128 3,650Creditors falling due after one year (1,162) (1,320) ----- -----Net assets 2,966 2,330 ====== ======Capital and reserves 1,448Share capital 1,448Share premium account 1,385 1,385Merger reserve 1,542 1,542Profit and loss account (1,409) (2,045) ------ ------Equity shareholders' funds 2,966 2,330 ====== ====== Summarised consolidated cash flow statementFor the twelve months ended 30 September 2006 Year ended Year ended 30 September 2006 30 September 2005 unaudited audited £000 £000 Net cash flow from operating activities 1,655 426 Returns on investments and servicing of finance (122) (125) Tax paid (65) (46) Capital expenditure (265) (117)Acquisitions and disposals - 143 ------ ------Net cash inflow before financing 1,203 281Net cash outflow from financing (76) (92) ------ ------ Increase in cash during the period 1,127 189 ====== ====== Reconciliation of operating loss to net cashflow from operating activities 840 236Group operating profitDepreciation and amortisation of fixed assets 337 349(Increase)/decrease in debtors (634) 673Increase/(decrease) in creditors 1,112 (832) ------ ------Net cash flow from operating activities 1,655 426 ====== ====== Statement of total recognised gains and lossesFor the twelve months ended 30 September 2006 Year ended Year ended 30 September 2006 30 September 2005 unaudited audited £000 £000 Profit for the financial period 649 23 Foreign exchange differences on translating overseas operations (13) (28) ------ ------Total recognised gains and losses in the year 636 (5) ====== ====== Reconciliation of movements in shareholders' fundsFor the twelve months ended 30 September 2006 30 September 2006 30 September 2005 unaudited audited £000 £000 Opening shareholders' funds 2,330 278 Exchange movement (13) (28) New shares issued - 2,266 Share issue costs - (209) Profit attributable to shareholders 649 23 ------ ------ Closing shareholders' funds 2,966 2,330 ====== ====== Notes 1 Amounts invoiced to clients and turnover An analysis of amounts invoiced to clients and turnover of the Group bygeographical area of origin is as follows: Year ended Year ended 30 September 2006 30 September 2005 unaudited audited £000 £000Amounts invoiced to clients United Kingdom 12,908 9,969Rest of Europe 4,024 2,315 ------ ------Total 16,932 12,284 ====== ====== Movements in amounts recoverable on contracts United Kingdom 127 311 Rest of Europe (775) 16 ------ ------ Total (648) 327 ====== ====== Turnover United Kingdom 13,035 10,280 Rest of Europe 3,249 2,331 ------ ------ Total 16,284 12,611 ====== ====== 2 Group operating profit Year ended Year ended 30 September 2006 30 September 2005 unaudited audited £000 £000 Amounts invoiced to clients 16,932 12,284 Movement in amounts recoverable on contracts (648) 327 ------ ------ Group turnover 16,284 12,611 Other income 27 49 Staff costs (7,271) (6,484) Amortisation of goodwill (51) (51) Depreciation (286) (298) Other operating charges (7,863) (5,201) Exceptional operating charges - (390) ------ ------ Group operating profit 840 236 ====== ====== 3 Profit on ordinary activities before tax An analysis of profit on ordinary activities before tax by geographical area oforigin is set out below. Corporate charges and consolidation adjustments areincluded under the United Kingdom. Year ended Year ended 30 September 2006 30 September 2005 unaudited audited £000 £000United Kingdom 428 129 Rest of Europe 358 30 ------ ------ Total 786 159 ====== ====== The Company disposed of Aukett BV, a 100% owned subsidiary based in theNetherlands, during the period for €1. The impact on results is not material. 4 Tax charge on profit on ordinary activities Year ended Year ended 30 September 2006 30 September 2005 unaudited audited £000 £000 United Kingdom corporation tax at 30% - (61) Overseas tax (126) (74) Share of tax from joint ventures and associate (1) (1) Prior year adjustment (36) - Deferred tax 26 - ------ ------ Tax charge on profit for period (137) (136) ====== ====== 5 Earnings per share The calculation of basic and diluted earnings per share are based on thefollowing data: Year ended Year ended 30 September 2006 30 September 2005 unaudited audited £000 £000 Profit attributable to shareholders 649 23 =========== =========== Weighted average number of shares in issue during the year 144,813,825 105,940,081 Effect of dilutive options 600,000 - ----------- ----------- Diluted weighted average number of shares in issue during 145,413,825 105,940,081the year =========== =========== There is no dilution to report in 2005 in accordance with FRS 22, Earnings pershare, as the fair value of the ordinary shares during the year calculated onthe basis of the average price of the ordinary shares during the year is lessthan the exercise prices. 6 Analysis of net debt An analysis of the movement in net debt during the year is as follows: At 1 October 2005 Non-cash At 30 September (as restated) Cash flow Movements 2006 £000 £000 £000 £000 Cash at bank and in hand 1,158 183 - 1,341Overdrafts repayable on demand (944) 944 - - ------ ------ ------ ------ 214 1,127 - 1,341 ------ ------ ------ ------Bank loans and other loansrepayable in:Less than one year (38) 38 (150) (150)More than one year (1,312) - 150 (1,162)Hire purchase and finance lease creditors (47) 38 - (9) ------ ------ ------ ------ (1,397) 76 - (1,321) ------ ------ ------ ------ Net debt (1,183) 1,203 - 20 ------ ------ ------ ------Loan note repayable in:Less than one year (200) - - (200) ------ ------ ------ ------ Net borrowings (1,383) 1,203 - (180) ====== ====== ====== ====== 7 Statutory accounts The financial information set out above does not constitute the Company'sstatutory accounts for the years ended 30 September 2006 or 2005 but is derivedfrom those accounts. The accounting policies applied in 2006 are consistentwith those applied in the statutory accounts for 2005 with the exception thatdue to the introduction of FRS25, Financial instruments: disclosure andpresentation, certain liabilities have been reclassified to creditors less thanone year which were previously disclosed as due in more than one year. Statutory accounts for 2005 have been delivered to the Registrar of Companies.The statutory accounts for 2006 have not yet been approved, audited or filed andwill be delivered following the Company's annual general meeting. The auditorshave reported on the 2005 accounts; their report was unqualified and did notcontain statements under section 237(2) or (3) of the Companies Act 1985. 8 Basis of preparation The Company meets its day to day working capital requirements through anoverdraft facility, which is repayable on demand, and longer term finance bymeans of loans. The directors consider that the Company will continue tooperate within its existing facilities until the expiry of the overdraftfacility when it is anticipated that suitable facilities will be renewed orreplaced. On this basis, the directors consider it appropriate to prepare thefinancial statements on the going concern basis. 9 Further information The Annual Report and Accounts is expected to be mailed to shareholders on orbefore 28 February 2007. Further copies will be available from the registeredoffice of the Company, 14 Devonshire Street, London W1G 7AE, or will beaccessible via the Company's website at www.aukettfitzroyrobinson.com. This information is provided by RNS The company news service from the London Stock Exchange