Last checked at 22 Sep 2015 14:59
INTERIM REPORT
FOR THE SIX MONTHS ENDED
30TH JUNE 2015
T.F. & J.H. Braime (Holdings) P.L.C.
Management commentary
For the six months ended 30th June 2015
Performance
Group sales revenue for the first six months of 2015 increased by 11.6% to £13,487,000 (2014 - £12,088,000) but profit before tax reduced from £513,000 to £406,000. Profit after tax fell to £282,000 compared to £363,000 for the comparable period of 2014.
This decrease in the group result was largely caused by the exceptional issues outlined in the divisional trading updates below.
Dividends
The directors have decided to maintain the first interim dividend at 2.90p per share (2014 - 2.90p). This dividend will be paid on the 18th October 2015 to the Ordinary and `A` Ordinary shareholders on the register on 9th October 2015. The associated ex-dividend date will be 8th October 2015.
Braime Pressings Limited
Due to unanticipated technical problems with two of the recently installed production lines, the company was initially unable to achieve the production rates and the output expected from the two standard shifts. This led to significant additional labour and energy costs to satisfy increased demand. This fall in productivity has slowly begun to be reversed but a substantial and continuing improvement in productivity is essential for the company to return to profitability.
Since April 2015, as part of the move to free the area of buildings being sold to the Leeds Advanced Manufacturing UTC Limited, who are building the University Technical College (UTC), Braime Pressings faced exceptional costs of circa £110,000 in condensing and improving its facilities. While major external costs have been capitalised, these costs have been charged to the Income Statement.
4B Division
All of the distribution companies in the 4B division, with the exception of the UK, have enjoyed very positive starts to the year. Our US division has benefited from the, albeit small, increase in the value of the US Dollar and the corresponding fall in the costs of its imported products.
Elsewhere, the fall of local currencies, relative to Sterling, have reduced the positive effect of otherwise growing local sales revenue in the consolidated result of the group.
During the period the UK part of our 4B division, operating in the material handling market, has changed its name from Braime Elevator Components Limited to 4B Braime Components Limited. This change was made in order to better reflect the broader range of products that it now manufactures and distributes internationally.
4B Braime Components Limited
4B Braime Components makes a significant portion of its overall sales directly to its exclusive distributors in Europe. These prices are set in Euros at the start of each year. The Euro fell against Sterling by about 15% in a very short time frame and this had a large negative impact on the gross margin.
Overall the result for the first six months of 2015 was well above the same period for last year but well below budget due to the negative effect of the changes in exchange rates.
Cash and Investments
On the basis of the sale of 25% of the manufacturing site, agreed early in 2015, for the planned UTC, the company is re-investing circa £1,100,000, which is the majority of the expected proceeds, in the modernisation of its UK facility.
T.F. & J.H. Braime (Holdings) P.L.C.
Management commentary - continued
For the six months ended 30th June 2015
Cash and Investments - continued
These improvements will have a positive effect on the operating performance, particularly of our 4B division. The company has already vacated the area needed for the UTC and the majority of the modernisation work will be completed in October this year. The funds raised by the sale are conditional on the UTC gaining planning consent from Leeds City Council, this is expected by the end of September. As a result of the need to finance our investment in advance of completion of the sale, now expected in October 2015, our cash flow has had to be very carefully managed and other investment projects have had to be postponed.
Outlook
Revenues remain strong, although there has been a slowdown in the UK operating subsidiaries in July and August. The principal concerns remain the urgent need for productivity improvements in our UK manufacturing business and the current level of exchange rates and the corresponding negative effect this may have on the final result for the year.
T.F. & J.H. Braime (Holdings) P.L.C.
Consolidated income statement
Interim results
For the six months ended 30th June 2015
-----------------
|
Note | Unaudited 6 months to 30th June 2015 | Unaudited 6 months to 30th June 2014 | Audited year to 31st December 2014 |
|
| £ | £ | £ |
|
|
|
|
|
Revenue |
| 13,487,175 | 12,088,143 | 24,291,700 |
|
|
|
|
|
Changes in inventories of finished goods and work in progress |
|
424,534 |
329,014 |
161,071 |
Raw materials and consumables used |
| (7,975,378) | (7,087,247) | (13,535,766) |
Employee benefits costs |
| (2,848,956) | (2,481,461) | (5,309,357) |
Depreciation expense |
| (342,441) | (238,243) | (564,244) |
Other expenses |
| (2,305,874) | (2,041,763) | (3,807,604) |
|
|
|
|
|
Profit from operations |
| 439,060 | 568,443 | 1,235,800 |
|
|
|
|
|
Profit on disposal of tangible fixed assets |
| 14,750 | - | 2,796 |
Finance costs |
| (53,505) | (55,632) | (115,291) |
Finance income |
| 5,870 | 43 | 2,164 |
|
|
|
|
|
Profit before tax |
| 406,175 | 512,854 | 1,125,469 |
|
|
|
|
|
Tax expense |
| (123,833) | (149,241) | (343,340) |
|
|
|
|
|
Profit for the period |
| 282,342 | 363,613 | 782,129 |
|
|
|
|
|
Profit attributable to : |
|
|
|
|
Owners of the parent |
| 305,646 | 363,613 | 864,011 |
Non-controlling interests |
| (23,304) | - | (81,882) |
|
| 282,342 | 363.613 | 782,129 |
|
|
|
|
|
Basic and diluted earnings per share | 2 | 19.61p | 25.25p | 54.31p |
T.F. & J.H. Braime (Holdings) P.L.C.
Consolidated statement of comprehensive income
For the six months ended 30th June 2015
| Unaudited 6 months to 30th June 2015 | Unaudited 6 months to 30th June 2014 | Audited year to 31st December 2014 |
| £ | £ | £ |
|
|
|
|
Profit for the period | 282,342 | 363,613 | 782,129 |
|
|
|
|
Items that will not be reclassified subsequently to profit or loss |
|
|
|
Net remeasurement gain on post employment benefits | - | - | 44,000 |
|
|
|
|
Items that may be reclassified subsequently to profit or loss |
|
|
|
Foreign exchange (losses)/gains on re-translation of overseas operations | (167,627) | (26,226) |
10,819 |
|
|
|
|
Other comprehensive income for the period | (167,627) | (26,226) | 54,819 |
|
|
|
|
Total comprehensive income for the period | 114,715 | 337,387 | 836,948 |
|
|
|
|
Total comprehensive income attributable to: |
|
|
|
Owners of the parent | 138,019 | 337,387 | 918,830 |
Non-controlling interests | (23,304) | - | (81,882) |
| 114,715 | 337,387 | 836,948 |
The foreign currency movements arise on the re-translation of overseas subsidiaries' opening balance sheets at closing rates.
T.F. & J.H. Braime (Holdings) P.L.C.
Consolidated balance sheet
At 30th June 2015
| Unaudited 6 months to 30th June 2015 | Unaudited 6 months to 30th June 2014 | Audited year to 31st December 2014 |
| £ | £ | £ |
|
|
|
|
Non-current assets |
|
|
|
Property, plant and equipment | 4,414,976 | 3,142,566 | 4,056,506 |
Goodwill | 12,270 | 12,270 | 12,270 |
Financial assets | 77,096 | - | 101,853 |
|
|
|
|
Total non-current assets | 4,504,342 | 3,154,836 | 4,170,629 |
|
|
|
|
Current assets |
|
|
|
Inventories | 5,218,773 | 5,112,346 | 4,888,183 |
Trade and other receivables | 5,028,829 | 5,017,522 | 4,911,108 |
Financial assets | 49,056 | - | 98,147 |
Cash and cash equivalents | 801,577 | 720,100 | 1,357,769 |
|
|
|
|
Total current assets | 11,098,235 | 10,849,968 | 11,255,207 |
|
|
|
|
Total assets | 15,602,577 | 14,004,804 | 15,425,836 |
|
|
|
|
Current liabilities |
|
|
|
Bank overdraft | 1,094,170 | 837,994 | 1,505,988 |
Trade and other payables | 4,178,533 | 3,662,158 | 3,752,594 |
Other financial liabilities | 1,278,021 | 1,241,095 | 1,323,095 |
Corporation tax liability | 37,867 | 190,588 | 187,054 |
|
|
|
|
Total current liabilities | 6,588,591 | 5,931,835 | 6,768,731 |
|
|
|
|
Non-current liabilities |
|
|
|
Financial liabilities | 1,442,491 | 1,037,833 | 1,111,045 |
Deferred income tax liability | 191,623 | 116,000 | 191,623 |
|
|
|
|
Total non-current liabilities | 1,634,114 | 1,153,833 | 1,302,668 |
|
|
|
|
Total liabilities | 8,222,705 | 7,085,668 | 8,071,399 |
|
|
|
|
Total net assets | 7,379,872 | 6,919,136 | 7,354,437 |
|
|
|
|
Capital and reserves |
|
|
|
Share capital | 360,000 | 360,000 | 360,000 |
Capital reserve | 257,319 | 77,319 | 257,319 |
Foreign exchange reserve | (79,386) | 51,196 | 88,241 |
Retained earnings | 6,947,125 | 6,430,621 | 6,730,759 |
Total equity attributable to the shareholders of the parent |
7,485,058 |
6,919,136 |
7,436,319 |
Non-controlling interests | (105,186) | - | (81,882) |
Total equity | 7,379,872 | 6,919,136 | 7,354,437 |
T.F. & J.H. Braime (Holdings) P.L.C.
Consolidated cash flow statement
For the six months ended 30th June 2015
|
Note | Unaudited 6 months to 30th June 2015 | Unaudited 6 months to 30th June 2014 | Audited year to 31st December 2014 | |
|
| £ | £ | £ |
|
Operating activities |
|
|
|
|
|
Net profit |
| 282,342 | 363,613 | 782,129 |
|
|
|
|
|
|
|
Adjustments for: |
|
|
|
|
|
Depreciation |
| 342,441 | 238,243 | 564,244 |
|
Grants amortised |
| (828) | (828) | (1,656) |
|
Non-cash operating charges |
| - | - | - |
|
Foreign exchange (losses)/gains |
| (163,125) | (24,057) | 15,279 |
|
Finance income |
| (5,870) | (43) | (2,164) |
|
Finance expense |
| 53,505 | 55,632 | 115,291 |
|
Gain on sale of plant, machinery and motor vehicles |
|
(14,750) |
- |
(2,796) |
|
Adjustment in respect of defined benefit scheme | - | - | 46,000 |
| |
Income tax expense |
| 123,833 | 149,241 | 343,340 |
|
Operating activities before changes in working capital and provisions |
|
617,548 |
781,801 |
1,859,667 |
|
|
|
|
|
|
|
Increase in trade and other receivables | (117,721) | (1,066,255) | (1,044,846) |
| |
Increase in inventories |
| (330,590) | (293,146) | (68,983) |
|
Increase in trade and other payables |
| 276,825 | 991,247 | 1,114,877 |
|
|
|
|
|
|
|
|
| (171,486) | (368,154) | 1,048 |
|
|
|
|
|
|
|
Cash generated from operations |
| 446,062 | 413,647 | 1,860,715 |
|
|
|
|
|
|
|
Income taxes paid |
| (273,020) | (4,680) | (41,685) |
|
|
|
|
|
|
|
Investing activities |
|
|
|
|
|
Purchases of property, plant, machinery and motor vehicles |
(536,905) |
(263,599) |
(1,368,985) |
| |
Sale of plant, machinery and motor vehicles |
| 14,750 | - | 14,540 |
|
Interest received |
| 5,870 | 43 | 164 |
|
|
| (516,285) | (263,556) | (1,354,281) |
|
|
|
|
|
|
|
Financing activities |
|
|
|
|
|
Proceeds from long term borrowings |
| 425,000 | - | 200,000 |
|
Loan financing repaid/(provided) |
| 73,848 | - | (200,000) |
|
Repayment of borrowings |
| (99,351) | (91,348) | (272,688) |
|
Repayment of hire purchase creditors |
| (57,843) | (103,327) | (170,231) |
|
Interest paid |
| (53,505) | (55,632) | (115,291) |
|
Dividend paid |
| (89,280) | (89,280) | (131,040) |
|
|
|
|
|
|
|
|
| 198,869 | (339,587) | (689,250) |
|
Decrease in cash and cash equivalents |
| (144,374) | (194,176) | (224,501) |
|
Cash and cash equivalents, beginning of period |
| (148,219) | 76,282 | 76,282 |
|
Cash and cash equivalents (including overdrafts), end of period |
3 |
(292,593) |
(117,894) |
(148,219) |
|
T.F. & J.H. Braime (Holdings) P.L.C.
Consolidated statement of changes in equity
For the six months ended 30th June 2015
|
Share Capital |
Capital Reserve | Foreign Exchange Reserve |
Retained Earnings |
Total | Non-Controlling Interests |
Total Equity |
| £ | £ | £ | £ | £ | £ | £ |
|
|
|
|
|
|
|
|
Balance at 1st January 2015 | 360,000 | 257,319 | 88,241 | 6,730,759 | 7,436,319 | (81,882) | 7,354,437 |
|
|
|
|
|
|
|
|
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit | - | - | - | 305,646 | 305,646 | (23,304) | 282,342 |
|
|
|
|
|
|
|
|
Other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net remeasurement gain recognised directly in equity | - | - | - | - | - | - | - |
Foreign exchange losses on re-translation of overseas operations | - | - | (167,627) | - | (167,627) | - | (167,627) |
Total other comprehensive income | - | - | (167,627) | - | (167,627) | - | (167,627) |
Total comprehensive income | - | - | (167,627) | 305,646 | 138,019 | (23,304) | 114,715 |
Transactions with owners |
|
|
|
|
|
|
|
Dividends | - | - | - | (89,280) | (89,280) | - | (89,280) |
Total Transactions with owners | - | - | - | (89,280) | (89,280) | - | (89,280) |
Balance at 30th June 2015 | 360,000 | 257,319 | (79,386) | 6,947,125 | 7,485,058 | (105,186) | 7,379,872 |
T.F. & J.H. Braime (Holdings) P.L.C.
Consolidated statement of changes in equity
For the six months ended 30th June 2015
|
Share Capital |
Capital Reserve | Foreign Exchange Reserve |
Retained Earnings |
Total | Non-Controlling Interests |
Total Equity |
| £ | £ | £ | £ | £ | £ | £ |
|
|
|
|
|
|
|
|
Balance at 1st January 2014 | 360,000 | 77,319 | 77,422 | 6,156,288 | 6,671,029 | - | 6,671,029 |
|
|
|
|
|
|
|
|
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit | - | - | - | 363,613 | 363,613 | - | 363,613 |
|
|
|
|
|
|
|
|
Other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net remeasurement gain recognised directly in equity | - | - | - | - | - | - | - |
Foreign exchange losses on re-translation of overseas operations | - | - | (26,226) | - | (26,226) | - | (26,226) |
Total other comprehensive income | - | - | (26,226) | - | (26,226) | - | (26,226) |
Total comprehensive income | - | - | (26,226) | 363,613 | 337,387 | - | 337,387 |
Transactions with owners |
|
|
|
|
|
|
|
Dividends | - | - | - | (89,280) | (89,280) | - |
|
Total Transactions with owners | - | - | - | (89,280) | (89,280) | - | (89,280) |
Balance at 30th June 2014 | 360,000 | 77,319 | 51,196 | 6,430,621 | 6,919,136 | - | 6,919,136 |
T.F. & J.H. Braime (Holdings) P.L.C.
Consolidated statement of changes in equity - continued
For the six months ended 30th June 2015
|
Share Capital |
Capital Reserve | Foreign Exchange Reserve |
Retained Earnings |
Total | Non-Controlling Interests |
Total Equity |
| £ | £ | £ | £ | £ | £ | £ |
|
|
|
|
|
|
|
|
Balance at 1st January 2014 | 360,000 | 77,319 | 77,422 | 6,156,288 | 6,671,029 | - | 6,671,029 |
|
|
|
|
|
|
|
|
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit | - | - | - | 864,011 | 864,011 | (81,882) | 782,129 |
|
|
|
|
|
|
|
|
Other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net remeasurement gain recognised directly in equity | - | - | - | 44,000 | 44,000 | - | 44,000 |
Foreign exchange losses on re-translation of overseas operations | - | - | 10,819 | - | 10,819 | - | 10,819 |
Total other comprehensive income | - | - | 10,819 | 44,000 | 54,819 | - | 54,819 |
Total comprehensive income | - | - | 10,819 | 908,011 | 918,830 | (81,882) | 836,948 |
Transactions with owners |
|
|
|
|
|
|
|
Dividends | - | - | - | (131,040) | (131,040) | - | (131,040) |
Cancellation of Preference shares | - | 180,000 | - | (202,500) | (22,500) | - | (22,500) |
Total Transactions with owners | - | 180,000 | - | (333,540) | (153,540) | - | (153,540) |
Balance at 31st December 2014 | 360,000 | 257,319 | 88,241 | 6,730,759 | 7,436,319 | (81,882) | 7,354,437 |
T.F. & J.H. Braime (Holdings) P.L.C.
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 2014 and those which management expects to apply in the group's full financial statements to 31st December 2015.
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 2014 but is derived from the accounts. Statutory accounts for the period ended 31st December 2014 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 2014, 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 per share amounted to 1,440,000 (2014 - 1,440,000). There are no potentially dilutive shares in issue.
| 6 months to 30th June 2015 |
| £ |
Dividends paid |
|
Equity shares |
|
Ordinary shares |
|
Interim of 6.20p per share paid on 2nd April 2015 | 29,760 |
|
|
'A' Ordinary shares |
|
Interim of 6.20p per share paid on 2nd April 2015 | 59,520 |
|
|
Total dividends paid | 89,280 |
|
|
| Year to 31st December 2014 |
| £ |
Dividends paid |
|
Equity shares |
|
Ordinary shares |
|
Interim of 6.20p per share paid on 4th April 2014 | 29,760 |
Interim of 2.90p per share paid on 17th October 2014 | 13,920 |
| 43,680 |
|
|
'A' Ordinary shares |
|
Interim of 6.20p per share paid on 4th April 2014 | 59,520 |
Interim of 2.90p per share paid on 17th October 2014 | 27,840 |
| 87,360 |
|
|
Total dividends paid | 131,040 |
T.F. & J.H. Braime (Holdings) P.L.C.
Notes to the interim financial report - continued
3. Cash and cash equivalents
| Unaudited 6 months to 30th June 2015 | Unaudited 6 months to 30th June 2014 | Audited year to 31st December 2014 |
| £ | £ | £ |
Cash at bank and in hand | 801,577 | 720,100 | 1,357,769 |
Bank overdrafts | 1,094,170 | 837,994 | 1,505,988 |
| (292,593) | (117,894) | (148,219) |
4. Segmental information
| Unaudited 6 months to 30th June 2015 | |||
| Central | Manufacturing | Distribution | Total |
| £ | £ | £ | £ |
|
|
|
|
|
Revenue |
|
|
|
|
External | - | 2,023,371 | 11,463,804 | 13,487,175 |
Inter company | 60,816 | 1,361,871 | 1,636,148 | 3,058,835 |
|
|
|
|
|
Total | 60,816 | 3,385,242 | 13,099,952 | 16,546,010 |
|
|
|
|
|
Profit |
|
|
|
|
EBITDA | (947) | (203,828) | 1,001,026 | 796,251 |
Finance costs | (19,246) | (15,102) | (19,157) | (53,505) |
Finance income | - | 355 | 5,515 | 5,870 |
Depreciation | (3,150) | (186,192) | (153,099) | (342,441) |
Tax expense | (21,290) | - | (102,543) | (123,833) |
|
|
|
|
|
(Loss)/profit for the period | (44,633) | (404,767) | 731,742 | 282,342 |
|
|
|
|
|
Assets |
|
|
|
|
Total assets | 1,328,215 | 4,210,758 | 10,063,604 | 15,602,577 |
Additions to non current assets | - | 643,810 | 68,095 | 711,905 |
Liabilities |
|
|
|
|
Total liabilities | 902,879 | 3,015,903 | 4,303,922 | 8,222,704 |
T.F. & J.H. Braime (Holdings) P.L.C.
Notes to the interim financial report - continued
4. Segmental information - continued
| Unaudited 6 months to 30th June 2014 | |||
| Central | Manufacturing | Distribution | Total |
| £ | £ | £ | £ |
|
|
|
|
|
Revenue |
|
|
|
|
External | - | 1,760,143 | 10,328,000 | 12,088,143 |
Inter company | 55,443 | 1,211,576 | 1,337,345 | 2,604,364 |
|
|
|
|
|
Total | 55,443 | 2,971,719 | 11,665,345 | 14,692,507 |
|
|
|
|
|
Profit |
|
|
|
|
EBITDA | 3,333 | 98,662 | 704,691 | 806,686 |
Finance costs | (14,542) | (22,774) | (18,316) | (55,632) |
Finance income | - | - | 43 | 43 |
Depreciation | (3,150) | (116,598) | (118,495) | (238,243) |
Tax expense | (15,750) | - | (133,491) | (149,241) |
|
|
|
|
|
(Loss)/profit for the period | (30,109) | (40,710) | 434,432 | 363,613 |
|
|
|
|
|
Assets |
|
|
|
|
Total assets | 1,298,767 | 3,194,579 | 9,511,458 | 14,004,804 |
Additions to non current assets | - | 217,330 | 46,269 | 263,599 |
Liabilities |
|
|
|
|
Total liabilities | 552,846 | 2,348,710 | 4,184,111 | 7,085,667 |
| Audited year to 31st December 2014 | |||
| Central | Manufacturing | Distribution | Total |
| £ | £ | £ | £ |
|
|
|
|
|
Revenue |
|
|
|
|
External | - | 3,621,626 | 20,670,074 | 24,921,700 |
Inter company | 113,568 | 2,761,536 | 3,743,664 | 6,618,768 |
|
|
|
|
|
Total | 113,568 | 6,383,162 | 24,413,738 | 30,910,468 |
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|
|
|
|
Profit |
|
|
|
|
EBITDA | (5,777) | 219,116 | 1,589,501 | 1,802,840 |
Finance costs | (27,820) | (46,387) | (41,084) | (115,291) |
Finance income | - | 2,000 | 164 | 2,164 |
Depreciation | (6,300) | (287,663) | (270,281) | (564,244) |
Tax expense | (78,099) | (34,335) | (230,906) | (343,340) |
|
|
|
|
|
(Loss)/profit for the period | (117,996) | (147,269) | 1,047,394 | 782,129 |
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|
|
|
|
Assets |
|
|
|
|
Total assets | 1,323,858 | 4,033,070 | 10,068,908 | 15,425,836 |
Additions to non current assets | - | 1,118,171 | 399,405 | 1,517,576 |
Liabilities |
|
|
|
|
Total liabilities | 520,316 | 2,868,453 | 4,682,630 | 8,071,399 |
22nd September 2015
T.F. & J.H. Braime (Holdings) P.L.C.
Contact details
For further information please contact:
T.F. & J.H. Braime (Holdings) P.L.C.
O. N. A. Braime - Chairman
0113 245 7491
W. H. Ireland Limited
Katy Mitchell LLB
0113 394 6628