Avingtrans Regulatory News (AVG)

Avingtrans plc

("Avingtrans" or the "Group")

Preliminary Results for the year ended 31 May 2014

Avingtrans plc, which designs, manufactures and supplies critical components, modules and associated services to the aerospace, energy and medical sectors, today announces its final results for the year ended 31 May 2014.

Financial Highlights

· Revenue increased by 33% to a record £60.3m (2013: £45.3m)

· Adjusted EBITDA increased to £5.6m, including £2.6m Bargain purchase from the acquisition of Maloney Metalcraft, which offset the expected losses in that Company (2013: £3.6m)

· Adjusted Profit Before Tax was £3.5m (2013: £1.9m)

· Adjusted Diluted earnings per share from continuing operations increased to 13.7 pence per share (2013: 7.0 pence per share)

· Cash generated from operating activities was £1.6m (2013: £0.5m outflow)

· Continued investment in capability and capacity: £4.3m (2013: £2.8m)

· Net debt was £3.6m (31 May 2013: £2.9m). Gearing 11% (2013: 10%)

· Increased final dividend of 1.8 pence per share, Full year total 2.7 pence (2013: Final 1.5 pence per share, Total 2.2 pence), an increase of 23%

Operational Highlights

Aerospace growth boosted by acquisitions, with an increase in revenues of 32% versus 2013

· Full effect of Farnborough and Derby acquisitions in 2013 coming through

· Hinckley new product introduction site is fully operational

· C&H strong year, with new "barrelling" capability bedding-in well

· Composites loss was reduced and the EU "Clean Skies" project progresses to plan

· Pipe production in China commenced, although growth slower than anticipated

· Quality & Delivery performance becoming best-in-class for key customers

· Post year end certain assets of RMDG acquired from Tricorn plc

Energy and Medical division revenues increased by 35%, driven by the Maloney acquisition

· New Divisional MD and other senior management changes completed

· The acquisition of Maloney Metalcraft affords us critical mass in the Oil & Gas sector

· The Maloney potential prospects list is growing, in strong market conditions

· Metalcraft China £1.0m phase 1 investment completed. Production ramp up is being paced by demand from Siemens in China, this is taking longer than they had anticipated

· Crown's markets are gradually improving and the business was profitable in 2014

Commenting on the results, Roger McDowell, Chairman, said:

"Once again, I am pleased to report significant Group revenue and EBITDA growth to shareholders. Driven by recent acquisitions, revenue grew by 33% and EBITDA by 55%. Adjusted diluted earnings per share almost doubled to 13.7 pence, assisted by a favourable tax charge. Despite continuing investment of £4.3m, Group net debt only increased modestly to £3.6m - lower than market expectations - with gearing stable at 11%. As before, there is no room for complacency. The Group saw significant currency headwinds last year and short term forecast variation means we need to remain agile. Aerospace remains in good health, with the recent acquisition of RMDG Aerospace consolidating our niche market leadership. Energy and Medical is also making headway in its restructuring plans. The Maloney Metalcraft acquisition has proven challenging, but the reinforced management team are getting to grips with the recovery. Importantly, we have also strengthened our Board this year, welcoming Les Thomas to the Group. We remain positive about the future and a 1.8 pence per share final dividend is proposed, making 2.7 pence for the year, an increase of 23%."

Enquiries:

Avingtrans plc tel. 01159 499 020

Roger McDowell, Chairman

Steve McQuillan, Chief Executive Officer

Stephen King, Chief Financial Officer

Numis

David Poutney (Corporate Broking) 0207 260 1000

Richard Thomas (Corporate Finance and Nominated Adviser)

Newgate Threadneedle 020 7653 9850

(Financial PR)

Josh Royston / Heather Armstrong

About Avingtrans plc:

Avingtrans has become a significant organisation in the design, manufacture and supply of critical components, systems and associated services to global industrial markets from two divisions: Aerospace and Energy and Medical.

Aerospace

Sigma Components Ltd - UK and China

Energy and Medical

Chairman's Statement

Prudent strategic construction of the group continued in the period, with the acquisition of Maloney Metalcraft (formerly Exterran UK) followed, post year-end, by the acquisition of certain assets of RMDG Aerospace from Tricorn plc. Coupled with on-going investment in the group of some £4.3m this year and new senior management appointments, this represents a significant investment plan and change management task for our divisions. We have also recently strengthened the Board, by appointing a new non-executive director, Les Thomas, CEO of Ithaca Energy Inc, to bolster our Oil and Gas sector credentials. Our passion for the Civil Aerospace, Energy and Medical Imaging markets continues and these markets provide strong medium-term prospects for growth, although some short-term adjustments to forecasts have been required in the current financial year, due to volume and mix effects with key customers.

During the period, we invested in skills at all levels, notably a new Managing Director for the Energy and Medical division, Austen Adams and (post year end) a new NED for Energy and Medical, Gareth Job. These recruitments demonstrate our focus on the Oil and Gas market in particular. In Aerospace, a fortified senior team is in place under Mark Johnson. We are delighted to welcome all of our new recruits to Avingtrans. These stronger divisional management teams are working hard to optimise their respective strategies and structures for the future.

In our Aerospace division, the acquisitions made over the last two years are generally integrating well and cementing our leadership position with key customers. Further reshaping to optimise the divisional performance is underway. As noted at the interims, the overall EBIT for the division is returning to respectable levels, though we are not complacent about this. Customers see Sigma as a key partner, with excellent product quality and delivery performance and a progressively capable technology development capability.

At Energy and Medical, the volume of change in the period means we are yet to see the financial results come through (excluding any one-off accounting profits associated with the acquisition of Maloney). A new leadership team, integration of Maloney and Metalcraft to tackle the Oil and Gas and Nuclear decommissioning markets, development of Energy prospect pipelines and further investment in China (for Siemens) are all elements of a deep change programme and we believe that investors will only begin to see the fruits of this activity in the current financial year.

During the year, we embraced the government sponsored world-class supply chain initiative, "Sharing in Growth" (SiG) at both Sigma and Metalcraft and we have been further assisted in this regard by Rolls Royce. This programme sets both divisions on a path to excellence, which we believe will enhance long-term returns for investors. We have dovetailed SiG with the implementation of the new Epicor manufacturing system across several sites, to good effect so far.

Although, it is pleasing once more to report results for the year in line with expectations, investors will note some headwinds that we must navigate successfully. For example, adverse exchange rates reduced group profits by £0.35m (approximately 10%) in the period and we continue to be impacted by exchange rates in the current financial year. Orders remain at high levels, with Aerospace signing further new long term contracts in the year. Acquisitions boosted revenue growth to 33% and adjusted EBITDA grew by 55%, to £5.6m (including the £2.6m Bargain purchase from the acquisition from Exterran, which offset the expected losses in Maloney Metalcraft) (note 2 reconciles EBITDA to adjusted EBITDA). Operating profit on continuing operations has increased year on year by £1.2m. Adjusted diluted earnings per share almost doubled to 13.7 pence. Unadjusted diluted earnings per share increased to 10.8 pence from 4.8 pence. Gearing rose marginally to 11% on Net debt nudging up to £3.6m. Therefore, the balance sheet remains in good shape, despite the previously mentioned on-going investment in the year, of £4.3m.

Nonetheless, our performance must still improve. For Aerospace, although Composites losses were reduced and Farnborough turned in a steady profit, both are capable of improvement. At Energy and Medical, bottom line losses in the year were partly justified by Maloney Metalcraft acquisition costs and subsequent restructuring. As expected, Metalcraft China made larger start-up losses than originally intended, due to the slower roll-out of the new Siemens product, which is an on-going issue. The new divisional leadership team have been busy clearing the decks, but a sizeable task remains, to integrate Metalcraft and Maloney, fully utilise our engineering capability and restore divisional profitability to respectable levels.

Finally, an increased final dividend, of 1.8 pence per share, rendering a full year total of 2.7 pence, underlines our commitment to consistently improve returns to our shareholders. On behalf of all of our customers and investors, I would again like to take this opportunity to thank our employees for their hard work and dedication to deliver excellent quality engineering products and services.

Roger McDowell

Chairman

30 September 2014

Business Review

Group Performance

Strategy

We are a precision engineering group, operating in differentiated, specialist niches in the supply chains of many of the world's best known engineering OEMs, for example: Rolls Royce, Siemens and Safran. Our core strategy is to build market-leading niche positions in our chosen sectors. We continue to focus on our Aerospace, Energy and Medical market niches. Recent acquisitions enable Sigma and Metalcraft to develop the critical mass to achieve leadership in their respective sectors. 

Our core businesses have the capability to engineer products in Europe and produce those products partly or wholly in Asia, allowing us and our customers to access low cost sourcing at minimum risk, as well as positioning us neatly in the development of the Chinese and Asian markets for our products. Sigma and Metalcraft are both well established in China, providing integrated supply chain options for our customers.

Niche Market Positioning

Aerospace: Our strength lies in civil aerospace, where we produce pipes for the majority of aero-engine suppliers into the large civil airliner market; and where we enjoy market leadership in Europe, as well as a leading position as an independent supplier globally. In addition, we are building a position in assemblies and fabrications beyond pipes - eg in ducts, nacelles, etc - that will allow us to access an even larger market niche. We also have UK market leadership in the domain of blade polishing and finishing through Sigma's C&H subsidiary.

Energy and medical: Following the Maloney Metalcraft acquisition, we can cement our position as a leading European supplier of oil and gas processing modules, vertically integrating this capability with the vessel manufacturing capability at Metalcraft. This same vertical integration capability lends itself to the "new nuclear" and nuclear decommissioning markets, as well as a variety of other niches in the renewable energy sector and emerging markets like shale gas.

Metalcraft's cryogenic vessel manufacturing pedigree, spanning over 40 years, makes us a supplier of choice to OEMs in markets where this capability is critical; notably in MRI, or related sectors. We enjoy a global market leading position in this particular supply niche.

We have strengthened our capability to manage sophisticated outsourced manufacturing programmes for OEMs, thus accessing business of enduring value, with the prospect of further sales growth. We remain focused on markets where we can sustain a significant, competitive, long term advantage and where the regulatory and technical requirements provide competitive barriers to entry.

Operations

Aerospace Division (Sigma)

Operational Key Performance Indicators (KPIs)

2014 2013

· Customer Quality - defects in parts per million (ppm) 3,732 3,082

· Customer on time in-full deliveries (%) 80 78

· Annualised staff turnover (%) 11.9 14.2

· Health, Safety and Environment incidents per head per annum 0.1 0.1

Sigma's progress this year was very positive overall. The 2013 acquisitions in Derby and Farnborough integrated well into the Group and produced consistent profits. Post year end, the acquisition of the RMDG assets from Tricorn plc further strengthens our leadership status in the aerospace pipes niche. During the year, losses at the Composites business reduced and we were able to begin to capitalise on the composites capability that we are developing. We continue to work to develop new capabilities and products, to broaden our appeal. Customers recognize Sigma as an important supplier in their increasingly global supply chains.

Operations (continued)

Aerospace Division (Sigma) (continued)

The civil aerospace market remains robust, with Airbus and Boeing continuing to report very strong 20-year projections in their latest outlooks. At the recent Farnborough air show, Boeing predicted a 5% compound growth in passenger traffic for the next 20 years, leading to demand for over 36,000 new large passenger aircraft in that time period. This trend is very positive for Sigma, although, in contrast, we have seen some short-term plateauing of demand in recent months. This is a function of the main aircraft and engine programmes that we participate in. Some older engine types have seen demand falling, whilst newer types are yet to compensate fully for the reductions in our mix. Stronger growth is expected to resume in the second half of the current financial year. In response, we are working hard to broaden our offering and our customer base, to take full advantage of the macro market dynamics.

Measured capital expenditure at Sigma continued, as has organisational development, through management and capability strengthening, as required. Sigma's world-class supplier journey continues and our OEM partners appreciate the improvements in delivery and quality that our focus is bringing. Plans to establish Sigma in the USA are progressing.

Aerospace division sales were up by 32% (to £38.5m) when compared to the prior year. Organic sales growth (excluding the two recent acquisitions) was 8%. Our order book remains at record levels, with over £200m of long term agreements having been signed in the last 18 months - some underpinning current business and some providing future growth.

Overall Aerospace EBIT margins were 12%, a pleasing improvement, driven mainly by improving profitability at Farnborough and reduced losses at Composites, though both of these sites remain below our desired run rate for profitability. Profits at Derby, Hinckley, Chengdu and Sandiacre (C&H) were reassuringly consistent. We plan for margins at Composites and Farnborough to improve in the current financial year, though this will partly be dependent on planned restructuring, following the recent RMDG acquisition.

Briefly summarising the main developments at the Aerospace sites:

· Hinckley's progress was slowed somewhat by changes in volumes of older and newer product mix and transfers to other sites. However, the site performance was good and the "Sharing in Growth" programme, driven by Rolls Royce and others, progressed well. The new Epicor IT system is up and running at Hinckley now too.

· Derby also saw some product mix effects in the year, but has integrated into Sigma well, achieving consistent profitability and having significantly improved delivery performance to key customers.

· Farnborough's performance improved markedly in the period and the site is now profitable. Delivery and quality improvements are encouraging, though with further room for improvement. The new Epicor system has helped to drive operational improvements on site in the year and is running smoothly.

· Chengdu's sales growth was slower in the last 12 months than previously, largely because of the mix changes noted above. However, the capacity of the site will be increased again during the current period, in anticipation of further customer demands and the need to expand pipe production in China.

· Buckingham (Composites) saw reduced losses in the year, as sales grew once more. We are making good headway with investment in composite aerospace components, in line with the EU "Clean Sky" contract.

· Sandiacre (C&H) had another strong and consistent year, with the "barreling" investment now being used in volume production.

· Post year end, Sigma acquired certain assets of RMDG (Swadlincote) from Tricorn plc. This is a site that dovetails well into the division, being a rigid pipe manufacturing centre. It also strengthens Sigma's relationships with key customers including Aircelle (Safran) and Bombardier, as well as bringing some new customers to the business.

Energy and Medical Division (Metalcraft, Maloney Metalcraft and Crown)

Operational Key Performance Indicators (KPIs)

2014 2013

· Customer Quality - defect free deliveries (%) 99.3 98.8

· Customer on time in-full deliveries (%) 92.5 87.1

· Annualised staff turnover (%) 8.6 9.3

· Health, Safety and Environment incidents per head per annum 0.2 0.4

Operations (continued)

Energy and Medical Division (Metalcraft, Maloney Metalcraft and Crown) (continued)

Headline revenue growth of 35% was driven by the acquisition of Maloney Metalcraft in July 2013. Adjusting for this, divisional revenue actually reduced by 7% in the period. This was entirely attributable to reduced sales to Siemens in the MRI market, where issues with the new product roll-out, entirely beyond our control, affected output. Discussions with Siemens are on-going, to seek ways to redress the balance. This resulted in on-going start-up losses in China, as anticipated, as well as losses in the UK Metalcraft business. The overall EBIT loss for the division, of -6%, was therefore worse than anticipated, though it should be noted that this figure also includes certain restructuring and acquisition costs associated with Maloney. A bright point for the division was Crown's return to modest profitability in the year.

Investors will recall that the acquisition price of £1 for Maloney indicated a business in some distress and, thus, we did expect losses at Maloney in the first year, both operationally and as a result of restructuring of the division. As anticipated, the "bargain profit" on acquisition balanced the initial losses and the benefits to investors of this reshaped business will only be realised in the current year and beyond. However, we can now see substantial longer term benefits still to be gained from the further integration of Maloney and Metalcraft.

Favourable market drivers remain intact. A recent GE report anticipates compound annual growth of world energy consumption of just over 2% over the next decade, with gas, nuclear and wind energy being the expected winners in a shifting energy supply mix. The global medical imaging market is expected to grow by over 5% per annum through to 2019, according to industry analysts, driven by conditions associated with an ageing global population. These trends remain positive for the division and underpin our strategy.

Summarising the situation at the Energy and Medical sites:

· Metalcraft, Chatteris: The roll-out of the new Siemens product did not proceed as anticipated, for reasons beyond our control and the Siemens business with Metalcraft declined in the year. Cummins volumes also remained weak and are not now significant in our forward planning. Other customers in the UK showed signs of growth - eg Heatric (Meggitt) where volumes are increasing from a low base. Nuclear decommissioning in the UK looks positive, though the sales to this market in the year were modest.

· Metalcraft, Chengdu: The fit-out of the factory continued, albeit moderated by the slower roll out of the Siemens products. Other Far East Medical customers continue to develop their activities with us and we anticipate some further capex investment to meet their needs. Start-up losses were therefore higher than in our original plans for the facility.

· Maloney Metalcraft, Aldridge: This business was acquired from Exterran in July 2013 for £1 and we continue to work on restoring its profitability. Operational losses were largely in line with expectations in the year, as well as restructuring costs to integrate the business into the division. Whilst we were encouraged by early contracts with Porvair, we are yet to convert other significant prospects in the pipeline. However, the prospect bank continues to grow strongly, though we would expect to win only a proportion of this business.

· Crown grew again in the year, with sales increasing from a low base. The result was a welcome, if modest, profit for the period and market conditions continue to steadily improve.

Financial Performance

Revenue: record sales

Full year Group revenue was up by more than 33%, to a record £60.3m (2013: £45.3m). Aerospace saw over 32% growth, lifted by the acquisitions made in 2013. Energy and Medical saw 35% growth overall, due to the acquisition of Maloney in the year. However, excluding Maloney, there was a 7% reduction in Energy and Medical, predominately due to on-going issues with new Siemens product roll-out.

Profit: underlying margins improving

Adjusted EBITDA, including the £2.6m Bargain purchase from the acquisition of Maloney Metalcraft which offset the expected losses in that Company (note 2), was up by 55%, to £5.6m (2013: £3.6m). Aerospace profits continued to be suppressed both by on-going losses at Composites (as anticipated) and by lower running rate profits at Farnborough albeit that both were trending positively. Issues with the with new Siemens product roll-out led to losses in Energy and Medical.

Gross margins were 24% (2013: 26%), adversely impacted by the Maloney acquisition early in the year. The underlying business improved to 27%. Adjusted PBT (note 2) also increased markedly, up by 78% to £3.5m (2013: £1.9m), despite adverse currency effects, amounting to £0.3m in the period.

Financial Performance (continued)

Tax: utilising benefits

The effective rate of taxation was a 15.3% credit, resulting from Research and Development tax credits in the UK, losses utilised in China and the reduction in the rate of corporation tax reducing deferred tax provisions. The tax position is expected to "normalise" in the coming years, though we anticipate some on-going benefits - eg R&D tax credits.

Earnings per Share (EPS): substantial progress

Adjusted diluted earnings per share almost doubled to 13.7p pence per share (2013: 7.0 pence per share), based on 28.1 million shares (diluted weighted average).

Funding and Liquidity: Balance sheet remains robust

The net cash inflow from operating activities was £1.6m (2013: £0.5m outflow), after a cash outflow from operations at Maloney Metalcraft of £2.2m, which was slightly higher than expected.

Net indebtedness (note 7) at year end stood at £3.6m (2013 Net Debt: £2.9m). Balance sheet gearing was 11% (2013: 10%).

Dividend: progression confirmed

The Board again voted to underline our progressive dividend policy and we are pleased to be able to recommend at the AGM an improved final dividend of 1.8 pence per share (2013: 1.5 pence per share). This will be paid on 12 December 2014 to shareholders on the register at 7 November 2014.

The Group continues to focus on exciting trading opportunities in the Aerospace and Energy sectors and we see further prospects to develop our offering, which should deliver long term growth and shareholder value. The continued backing of our investors, coupled with a positive relationship with the Group's principal bankers, means we expect to have more than adequate financial resources to continue to invest in the business. We also continue to develop relationships with an array of new and potential stakeholders, assisted by our consistent dividend track record.

People

During the period, we continued to strengthen our management teams in both divisions, including integration of the senior managers in the recently acquired businesses. In Aerospace, a senior management reorganisation was completed, recognising the significant changes necessary after several recent acquisitions. A similar strengthening exercise is underway in Energy and Medical, following the Maloney acquisition and the appointment of Austen Adams as Divisional Managing Director, after the retirement of Peter Kenny.

Each of the businesses augmented its base of skilled engineering and technical personnel, with intellectual property development becoming more prevalent in the reshaped group. Skills availability remains challenging, but we do not expect to be constrained by any shortages and we continue to invest in skills - eg apprenticeships - at several locations. Both divisions increased headcount in the last year, but the output per employee also continued to improve.

Post year end, we acted to strengthen our non-executive leadership team, with the appointment of Les Thomas, the CEO of Ithaca Energy Inc, to the plc Board and the appointment of Dr Gareth Job, of Technip, to the Energy and Medical Divisional Board. Both appointments underline our commitment to the Energy market - especially Oil & Gas.

Outlook

The group is now a niche engineering market leader in the Aerospace, Energy and Medical sectors. With attractive structural growth markets and durable customer relationships, we remain cautiously confident about the future of Avingtrans, notwithstanding any short term issues with product mix and currency exchange rates. The world economic outlook is also broadly positive, despite current geopolitical stresses. Prospects for Civil Aerospace and Oil & Gas, in particular, are exciting.

Our strategy has already produced significant new business wins that support our results and provide good visibility of longer term earnings. We have an excellent customer base to build on and differentiated product niches to develop that offer a degree of protection to market cycles. We are clearly well placed to benefit from further market consolidation.

Our recent acquisitions emphasise our intention to build shareholder value through targeted M&A activity. Although we cannot state that this will result in any further transactions during the current financial period, we will pursue any opportunity to enhance long-term value.

Sigma and Metalcraft are clear leaders in their chosen niche markets, providing customers with consistent quality as part of a world class supplier journey, with our growing Chinese presence providing a crucial competitive advantage. Investors are once more invited to endorse our strategy and join us in developing a great British engineering story. Thank you for your support.

Roger McDowell Steve McQuillan Stephen King

Chairman Chief Executive Officer Chief Financial Officer

30 September 2014 30 September 2014 30 September 2014

Consolidated statement of Comprehensive income

Exchange differences recycled on disposal of subsidiary undertakings relates to discontinued operations.

Cash flows from operating activities:

for the year ended 31 May 2014

Notes to the Preliminary Statement

31 May 2014

1 Segmental analysis

Energy and Medical results includes the acquisition of the Exterran UK limited (renamed Maloney Metalcraft) which contributed £6,686,000 and £2,195,000 to Group revenue and loss after tax respectively, which was offset above by the £2,615,000 bargain purchase on acquisition (note 5). 

Notes to the Preliminary Statement (continued)

31 May 2014

Geographical

The Group has Aerospace revenue of £13,314,000 (2013: £10,612,000) and Energy & Medical revenue of £7,597,000 (2013: £9,661,000) with single external customers under common control, which each represent more than 10% of the Group's revenue.

2 Adjusted Earnings before interest, tax, depreciation and amortisation

The Directors believe that the above adjusted earnings are a more appropriate reflection of the Group performance and should not adjust for the £2,615,000 bargain purchase on acquisition which offset the expected losses at Maloney Metalcraft in the period since acquisition.

3 Taxation

Notes to the Preliminary Statement (continued)

31 May 2014

4 Earnings per ordinary share

Notes to the Preliminary Statement (continued)

31 May 2014

5 Acquisitions

Business combinations - Maloney Metalcraft Limited

On 3 July 2013 the Group acquired 100 percent of the issued share capital of Maloney Metalcraft Limited (formerly Exterran (UK) Limited). The provisional net assets at the date of acquisition were as follows:

Cash of £1 was paid for the share capital of Exterran (UK) Limited. Consideration also includes £359k relating to contractual retention bonuses as set out in the SPA that under IFRS 3 have been accounted for as consideration for the assets acquired.

The acquisition of this business resulted in a gain on purchase as a consequence of buying the business in a distressed state. The gain on bargain purchase is separately presented in the income statement before operating profit. Also as a result of the distressed state in which the business was in at the date of purchase and following a review of the assets acquired, the Directors consider that no intangible assets of any value have been acquired.

The acquired entity incurred a loss after tax of £2,195,000 for the 11 months from 3 July 2013 to the reporting date. If it had been acquired on 1 June 2013, revenue for the Group would have been £7,070,000 and loss after tax for the year would have increased by £205,000.

Acquisition costs arising from this transaction of £171,000 have been included in administration expenses before operating profit.

6 Events after the balance sheet date

On 11 August 2014 Sigma Precision Components UK limited completed the acquisition of certain of the assets of RMDG limited for £1,100,000 plus professional costs. In its previous financial year RMDG had turnover of £3,327,000 and a loss before tax of £398,000 after exceptional restructuring costs of £275,000.

7 Net Debt and gearing

8 Preliminary statement

This preliminary statement, which has been agreed with the auditors, was approved by the Board on 30 September 2014. It is not the Group's statutory accounts within the meaning of Section 434 of the Companies Act 2006.

The statutory accounts for the two years ended 31 May 2014 and 2013 received audit reports which were unqualified and did not contain statements under s498(2) or (3) of the Companies Act 2006. The statutory accounts for the year ended 31 May 2013 have been delivered to the Registrar of Companies but the 31 May 2014 accounts have not yet been filed.

9 Annual report and Accounts

The Report and Accounts for the year ended 31 May 2014 will be available on the Group's website www.avingtrans.plc.uk on or around 8 October 2014. Further copies will be available from the Avingtrans' registered office:

Precision House, Derby Road, Sandiacre, Nottingham, NG10 5HU.

10 Annual General Meeting

The Annual General Meeting of the Group will be held at The Holiday Inn, Bostocks Lane, Sandiacre, Nottingham NG10 5NL at 11.00 a.m. on 12 November 2014