Last checked at 22 Sep 2011 14:13
T.F. & J.H. BRAIME (HOLDINGS) P.L.C.
("Braime" or the "company")
Interim results for the six months ended 30th June 2011
The significant increases in sales revenue achieved in recent years has continued in the first six months of 2011, with sales revenue up by 16% from £ 8.32m in 2010 to £9.66m in 2011.
Profit before tax rose from £396,000 to £427,000, an increase of 7.8%. We believe this slower rate of growth stemmed from a relative fall in the gross margin in turn caused primarily by a large jump in commodity prices.
The group was cash negative in the first six months as a result of increases in debtors and inventories supporting the increase in sales revenue. The group also continued to invest in capital machinery to improve the efficiency of the manufacturing business.
Accordingly the directors have decided to maintain the interim dividend at the same level as paid in 2010. A dividend of 2.40p per share will be paid on 14th October 2011 to the Ordinary and `A' Ordinary shareholders on the register on 30th September 2011.
Performance of group companies
4B division
All the subsidiary companies within this division have continued to perform well ahead of both the same period last year and above budget, although margins have been eroded in some product lines due to the massive increase in the cost of materials. Inevitably in a fiercely competitive market, it has been difficult to gain full and immediate acceptance of these cost increases by customers.
Pressings division
We are seeing increasing demand from existing contracts and have secured sales for additional parts. However, in spite of the enormous efforts made by our staff, we have continued to experience frustrating delays in the launch of these critical new contracts. As a result of these costly delays, the manufacturing business continues to lose money.
Outlook
The group as a whole has made a positive start in the first half of 2011, although the world wide explosion in commodity prices has had a negative effect on our margins and is creating instability and a general lack of confidence among our customers.
Up to this point in time, we have been fortunate in that the bulk of the group's sales are to the commercial agro market world wide and the strength of this sector has sheltered us from the recession. However, we are now seeing the first signs of a fall off in demand, even within this sector, caused by the growing economic uncertainty and the increasing difficulty in securing finance for projects.
In these circumstances, it is important that we improve our stock management within the 4B division and that we eliminate the losses in the manufacturing division by finally bringing the new contracts on stream.
Condensed consolidated income statementfor thesix months ended 30th June 2011
Unaudited Unaudited Year to 6 months to 6 months to 31st 30th June 30th June December Note 2011 2010 2010 £ £ £ Revenue 9,656,490 8,317,924 18,057,661 Cost of sales 7,494,668 6,379,779 13,553,654 Gross profit 2,161,822 1,938,145 4,504,007 Other operating expenses 1,700,753 1,513,886 3,090,960 Operating profit 461,069 424,259 1,413,047 Finance expense (172,229) (151,235) (302,445) Finance income 138,041 122,982 250,776 Profit before tax 426,881 396,006 1,361,378 Income tax expenses (119,527) (110,042) (416,240) Profit after tax 307,354 285,964 945,138
Basic and diluted earnings per 2 21.34p 19.86p 65.63p share
Consolidated statement of comprehensive income for the six months ended 30th June 2011 Unaudited Unaudited Year to 6 months to 6 months to 31st 30th June 30th June December 2011 2010 2010 £ £ £ Profit for the period 307,354 285,964 945,138 Actuarial losses recognised directly - - (168,000)in equity Foreign exchange gains/(losses) on 56,427 25,717 (33,254)re-translation of overseas operations Adjustment in respect of minimum (25,000) - 137,000 funding requirement per IFRIC14
Total other comprehensive income for 31,427 25,717 (64,254) the period
Total comprehensive income for the 338,781 311,681 880,884 period Consolidated statement of financial positionat 30th June 2011 Unaudited Unaudited Year to 6 months to 6 months to 31st 30th June 30th June December 2011 2010 2010 £ £ £ Non-current assets Property, plant and equipment 1,444,106 1,207,447 1,223,980 Goodwill 12,270 12,270 12,270 Total non-current assets 1,456,376 1,219,717 1,236,250 Current assets Inventories 3,879,299 2,995,554 3,593,680 Trade and other receivables 4,077,310 3,282,853 3,291,602 Cash and cash equivalents 1,804,679 1,592,740 1,844,934 Total current assets 9,761,288 7,871,147 8,730,216 Total assets 11,217,664 9,090,864 9,966,466 Current liabilities Bank overdraft 1,630,184 1,106,334 1,145,421 Trade and other payables 3,154,832 2,385,993 2,707,169 Other financial liabilities 352,862 314,985 291,553 Corporation tax liability 119,527 110,042 171,054 Total current liabilities 5,257,405 3,917,354 4,315,197 Non-current liabilities Financial liabilities 428,341 445,896 389,012 Total non-current liabilities 428,341 445,896 389,012 Total liabilities 5,685,746 4,363,250 4,704,209 Total net assets 5,531,918 4,727,614 5,262,257 Capital and reserves Share capital 360,000 360,000 360,000 Capital reserve 77,319 77,319 77,319 Foreign exchange reserve 342,719 345,263 286,292 Retained earnings 4,751,880 3,945,032 4,538,646
Total equity attributable to equity 5,531,918 4,727,614 5,262,257 shareholders of the company
Consolidated statement of changes in equity for thesix months ended 30th June
2011 Foreign Share Capital Exchange Retained Capital Reserve Reserve Earnings Total £ £ £ £ £ Balance at 1st January 360,000 77,319 286,292 4,538,646 5,262,257 2011 Comprehensive income Profit - - - 307,354 307,354 Other comprehensive income Actuarial gains - - - - - recognised directly in equity Foreign exchange gains on - - 56,427 - 56,427 re-translation of overseas operations Adjustment in respect of - - - (25,000) (25,000)minimum funding requirement per IFRIC14 Total other comprehensive - - 56,427 (25,000) 31,427 income Total comprehensive - - 56,427 282,354 338,781 income Transaction with owners Dividends - - - (69,120) (69,120) Total transactions with - - - (69,120) (69,120)owners
Balance at 30th June 2011 360,000 77,319 342,719 4,751,880 5,531,918
Balance at 1st January 360,000 77,319 319,546 3,702,268 4,459,133 2010 Comprehensive income Profit - - - 285,964 285,964 Other comprehensive income Actuarial gains - - - - - recognised directly in equity Foreign exchange losses - - 25,717 - 25,717 on re-translation of overseas operations Adjustment in respect of - - - - - minimum funding requirement per IFRIC14 Total other comprehensive - - 25,717 - 25,717 income Total comprehensive - - 25,717 285,964 311,681 income Transaction with owners Dividends - - - (43,200) (43,200) Total transactions with - - - (43,200) (43,200)owners
Balance at 30th June 2010 360,000 77,319 345,263 3,945,032 4,727,614
Balance at 1st January 360,000 77,319 319,546 3,702,268 4,459,133 2010 Comprehensive income Profit - - - 945,138 945,138 Other comprehensive income Actuarial losses - - - (168,000) (168,000)recognised directly in equity Foreign exchange losses - - (33,254) - (33,254)on re-translation of overseas operations Adjustment in respect of - - - (137,000) (137,000)minimum funding requirement per IFRIC14 Total other comprehensive - - (33,254) (31,000) (64,254)income Total comprehensive - - (33,254) 914,138 880,884 income Transaction with owners Dividends - - - (77,760) (77,760) Total transactions with - - - (77,760) (77,760)owners
Balance at 31st December 360,000 77,319 286,292 4,538,646 5,262,257 2010
Consolidated cash flow statementfor thesix months ended 30th June 2011 Unaudited Unaudited Year to 6 months to 6 months to 31st 30th June 30th June December Note 2011 2010 2010 £ £ £ Operating activities Net profit from ordinary 307,354 285,964 945,138 activities Adjustments for: Depreciation 186,713 139,045 286,938 Grants amortised (828) (828) (1,656) Foreign exchange loss/(gain) 62,548 15,977 (37,785) Investment income (138,041) (122,982) (250,776) Interest expense 172,229 151,235 302,445 Gain on sale of plant and (6,212) (11,808) (35,357)equipment Adjustment in respect of (21,000) 3,000 (22,000)defined benefit scheme Income tax expense 119,527 110,042 416,240 Operating profit before 682,290 569,645 1,603,187 changes in working capital and provisions Increase in trade and other (785,708) (882,469) (891,218)receivables Increase in inventories (285,619) (133,405) (731,531) Increase in trade and other 510,180 495,894 713,331 payables (561,147) (519,980) (909,418) Cash generated from operations 121,143 49,665 693,769 Income taxes paid (233,571) (128,954) (270,401) Investing activities Purchases of plant, machinery (207,670) (50,718) (210,154)and motor vehicles Sale of plant, machinery and 6,212 14,458 35,358 motor vehicles Interest received 2,041 1,982 4,776 (199,417) (34,278) (170,020) Financing activities Repayment of hire purchase (103,824) (110,833) (197,871)creditors Interest paid (40,229) (33,235) (65,445) Dividend paid (69,120) (43,200) (77,760) (213,173) (187,268) (341,076) Decrease in cash and cash 3 (525,018) (300,835) (87,728)equivalents Cash and cash equivalents 3 699,513 787,241 787,241 (including overdrafts), beginning of period Cash and cash equivalents 174,495 486,406 699,513 (including overdrafts), end of period
Notes to the interim financial report
1. Accounting policies
Basis of preparation
The interim financial report has been prepared using accounting policies that are consistent with those used in the preparation of the full financial statements to 31st December 2010 and those which management expects to apply in the group's full financial statements to 31st December 2011.
This interim financial report is unaudited. The comparative financial information set out in this interim financial report does not constitute the group's statutory accounts for the period ended 31st December 2010 but is derived from the accounts. Statutory accounts for the period ended 31st December 2010 have been delivered to the Registrar of Companies. The auditors have reported on those accounts. Their audit report was unqualified and did not contain any statements under Section 498 of the Companies Act 2006.
The group's condensed interim financial information has been prepared in accordance with International Financial Reporting Standards (`IFRS') as adopted for the use in the European Union and in accordance with IAS 34 `Interim Financial Reporting' and the accounting policies included in the Annual Report for the year ended 31st December 2010, which have been applied consistently throughout the current and preceding periods.
2. Earnings per share and dividends
Both the basic and diluted earnings per share have been calculated using the net results attributable to shareholders of T.F. & J.H. Braime (Holdings) P.L.C. as the numerator.
The weighted average number of outstanding shares used for basic earnings pershare amounted to 1,440,000 (2010 - 1,440,000). There are no potentiallydilutive shares in issue. 2011 £ Dividends paid Equity shares Ordinary shares Interim of 4.80p per share paid on 1st April 2011 23,040 `A' Ordinary shares Interim of 4.80p per share paid on 1st April 2011 46,080 Total dividends paid 69,120 2010 £ Dividends paid Equity shares Ordinary shares Interim of 3.0p per share paid on 1st April 2010 14,400 Interim of 2.40p per share paid on 15th October 2010 11,520 `A' Ordinary shares Interim of 3.00p per share paid on 1st April 2010 28,800 Interim of 2.40p per share paid on 15th October 2010 23,040 Total dividends paid 77,760 3. Cash and cash equivalents Unaudited Unaudited Year to 6 months to 6 months to 31st 30th June 30th June December 2011 2010 2010 £ £ £ Cash at bank and in hand 1,804,679 1,592,740 1,844,934 Bank overdrafts 1,630,184 1,106,334 1,145,421 174,495 486,406 699,513 4. Segmental information Unaudited 6 months to 30th June 2011 Central Manufacturing Distribution Total £ £ £ £ Revenue External - 962,917 8,693,573 9,656,490 Inter company 29,885 1,310,367 751,557 2,091,809 Total 29,885 2,273,284 9,445,130 11,748,299 Profit EBITDA (29,702) 6,395 671,089 647,782 Finance costs (7,168) (151,789) (13,272) (172,229) Finance income 800 137,239 2 138,041 Depreciation - (157,267) (29,446) (186,713) Tax expense (8,368) - (111,159) (119,527) (Loss)/profit for the (44,438) (165,422) 517,214 307,354 period Assets Total assets 820,403 3,256,977 7,140,284 11,217,664 Additions to non - 346,454 57,336 403,790 current assets Liabilities Total liabilities 570,278 2,611,112 2,504,356 5,685,746 Unaudited 6 months to 30th June 2010 Central Manufacturing Distribution Total £ £ £ £ Revenue External - 1,093,574 7,224,350 8,317,924 Inter company 33,638 784,058 419,824 1,237,520 Total 33,638 1,877,632 7,644,174 9,555,444 Profit EBITDA (8,914) (31,596) 603,814 563,304 Finance costs (6,815) (134,692) (9,728) (151,235) Finance income 749 122,233 - 122,982 Depreciation - (111,600) (27,445) (139,045) Tax expense (9,419) - (100,623) (110,042) (Loss)/profit for the (24,399) (155,655) 466,018 285,964 period Assets Total assets 778,974 2,974,686 5,337,204 9,090,864 Additions to non - 80,050 23,718 103,768 current assets Liabilities Total liabilities 337,324 1,830,652 2,195,274 4,363,250 Audited year to 31st December 2010 Central Manufacturing Distribution Total £ £ £ £ Revenue External - 2,126,262 15,931,399 18,057,661 Inter company 64,743 2,787,705 1,606,740 4,459,188 Total 64,743 4,913,967 17,538,139 22,516,849 Profit EBITDA (15,617) 125,391 1,590,211 1,699,985 Finance costs (14,493) (267,354) (20,598) (302,445) Finance income 1,719 248,699 358 250,776 Depreciation - (249,366) (37,572) (286,938) Tax expense (21,450) 5,545 (400,335) (416,240) (Loss)/profit for the (49,841) (137,085) 1,132,064 945,138 period Assets Total assets 766,618 2,846,980 6,352,868 9,966,466 Additions to non - 199,946 63,258 263,204 current assets Liabilities Total liabilities 480,636 2,063,659 2,159,914 4,704,209 22nd September 2011
A copy of this interim statement has been sent to all shareholders and is available on the company's web-site (www.braimegroup.com).
For further information please contact:
T.F & J.H. Braime (Holdings) P.L.C.
David H. Brown FCA - Financial Director
0113 245 7491W. H. Ireland LimitedKaty Mitchell LLB0113 3946628