Last checked at 8 Nov 2013 10:42
Creightons plc Group
Interim financial report
For the six months ended 30 September 2013
Chairman's Statement
The Group has made considerable progress in the first half of the year recording improved profit before tax of £153,000 in the six months to 30 September 2013 (2012: £38,000).
The profit improvement came on the back of increased sales which rose by 16% to £9,738,000 (2012: £8,374,000). The sales improvement largely arose from new private label range launches with key retailers and significant promotional activity. Some of this is of a one off nature and may not be repeated in the second half of the year.
Our gross margins are 40.2% in the six months to 30 September 2013 (2012: 42.0%). Sales mix is the main reason for this reduction with lower sales in North America and new product launches at lower margins. Raw material price increases have not been a significant factor in the period. We are focusing efforts to improve our margins through product re-engineering, targeted investment in inventory and investment in plant and machinery which will improve output at lower costs.
We have continued to review our sales strategy in the period and have trimmed a number of brands/products considered peripheral to our core activity. This has resulted in lower levels of more focused new product development activity in the period. We continue to see opportunities to develop our brands in overseas markets and to develop good quality products at a competitive price in the UK. We intend to increase resources and investments to achieve these two goals.
We continue to be cautious regarding the underlying level of retail sales and consider that consumers in the UK will continue to be focused on value. This will present sales opportunities but may impact on margins.
From a working capital perspective stock levels have fallen over the period against a background of increasing sales. We anticipate some increase in stocks over the coming months to support new launch activity. Sales growth has resulted in an increase in debtors with debtor days remaining constant compared to last year.
Our net cash position at the end of the period has improved with borrowings net of cash falling by £118,000 to £635,000 (2012: £753,000).
I believe that this half year's increased sales of £9,738,000 and pre-tax profit of £153,000 is a good performance and places the Company in a good position to take advantage of any opportunities that may arise.
W O McIlroy
Executive Chairman 8 November 2013
Responsibility statement
We confirm that to the best of our knowledge:
a) The condensed set of financial statements has been prepared in accordance with IAS 34:
b) The interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and
c) The interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of material related party transactions and changes therein).
By order of the Board
Nicholas O'Shea
Company Secretary and Director
Creightons plc
Interim financial report
For the six months ended 30 September 2013
Consolidated income statement - unaudited
Six months ended 30 September | Year ended 31 March | |||
2013 | 2012 | 2013 | ||
Note | £000 | £000 | £000 | |
Revenue | 9,738 | 8,374 | 17,326 | |
Cost of sales | (5,825) | (4,858) | (9,902) | |
Gross profit | 3,913 | 3,516 | 7,424 | |
Distribution costs | (399) | (360) | (763) | |
Administrative expenses | (3,341) | (3,102) | (6,328) | |
Operating profit | 173 | 54 | 333 | |
Finance costs | (20) | (16) | (31) | |
Profit before tax | 153 | 38 | 302 | |
Taxation | - | - | - | |
Profit for the period from continuing operations attributable to the equity holders of the parent company | 153 | 38 | 302 | |
Earnings per share
| Basic | 2 | 0.28p | 0.07p | 0.55p |
Diluted | 2 | 0.26p | 0.06p | 0.51p |
Consolidated statement of comprehensive income
Six months ended 30 September | Year ended 31 March | |||
2013 | 2012 | 2013 | ||
£000 | £000 | £000 | ||
| Profit for the period from continuing operations | 153 | 38 | 302 | |
Exchange differences on translating of foreign operations | 27 | - | (22) | |
Total comprehensive income for the period attributable to the equity holders of the company | 180 | 38 | 280 | |
Creightons plc
Interim financial report
30 September 2013
Consolidated balance sheet - unaudited
30 September | 31 March | |||
2013 | 2012 | 2013 | ||
£000 | £000 | £000 | ||
| Non-current assets | ||||
Goodwill | 343 | 345 | 343 | |
Other intangible assets | 255 | 265 | 295 | |
Property, plant and equipment | 516 | 542 | 525 | |
1,114 | 1,152 | 1,163 | ||
| Current assets | ||||
Inventories | 3,547 | 3,695 | 3,526 | |
Trade and other receivables | 3,436 | 3,008 | 2,811 | |
Cash and cash equivalents | 12 | 33 | 18 | |
6,995 | 6,736 | 6,355 | ||
Total assets | 8,109 | 7,888 | 7,518 | |
| Current liabilities | ||||
Trade and other payables | 2,880 | 2,923 | 2,219 | |
Obligations under finance leases | 19 | 19 | 19 | |
Short term borrowings | 647 | 786 | 892 | |
3,546 | 3,728 | 3,130 | ||
Net current assets | 3,449 | 3,008 | 3,225 | |
Non-current liabilities | ||||
Obligations under finance leases | 39 | 57 | 48 | |
Total liabilities | 3,585 | 3,785 | 3,178 | |
Net assets | 4,524 | 4,103 | 4,340 | |
| Equity | ||||
Share capital | 545 | 545 | 545 | |
Share premium account | 1,231 | 1,231 | 1,231 | |
Other reserves | 38 | 38 | 38 | |
Share-based payment reserve | 55 | 51 | 51 | |
Retained earnings | 2,683 | 2,266 | 2,530 | |
Translation reserve | (28) | (28) | (55) | |
Total equity attributable to the equity shareholders | 4,524 | 4,103 | 4,340 | |
Creightons plc
Interim financial report
For the six months ended 30 September 2013
Statement of changes in shareholders equity - unaudited
Share capital
| Share premium account | Other reserves | Share-based payment reserve | Retained earnings | Translation reserve | Total | |
£000 | £000 | £000 | £000 | £000 | £000 | £000 | |
Balance at 1 April 2012 | 545 | 1,231 | 38 | 44 | 2,228 | (33) | 4,053 |
Profit for six months ended 30 September 2012 | - | - | - | - | 38 | - | 38 |
Debit to equity for share based payments | - | - | - | 7 | - | - | 7 |
Exchange differences on translation of foreign operations | - | - | - | - | - | 5 | 5 |
Balance at 30 September 2012 | 545 | 1,231 | 38 | 51 | 2,266 | (28) | 4,103
|
Profit for six months ended 31 March 2013 | - | - | - | - | 264 | - | 264 |
Exchange differences on translation of foreign operations | - | - | - | - | - | (27) | (27) |
Balance at 31 March 2013 | 545 | 1,231 | 38 | 51 | 2,530 | (55) | 4,340 |
Profit for six months ended 30 September 2013 | - | - | - | - | 153 | - | 153 |
Debit to equity for share based payments | - | - | - | 4 | - | - | 4 |
Exchange differences on translation of foreign operations | - | - | - | - | - | 27 | 27 |
Balance at 30 September 2013 | 545 | 1,231 | 38 | 55 | 2,683 | (28) | 4,524
|
Creightons plc
Interim financial report
For the six months ended 30 September 2013
Consolidated cash flow statement - unaudited
Six months ended 30 September | Year ended 31 March | |||
2013 | 2012 | 2013 | ||
£000 | £000 | £000 | ||
Net cash inflow from operating activities | 417 | 195 | 306 | |
| Cash flow from investing activities | ||||
Purchase of property, plant and equipment | (59) | (48) | (97) | |
Expenditure on intangible assets | (109) | (158) | (334) | |
| Net cash used in investing activities | (168) | (206) | (431) | |
| Cash flow from financing activities | ||||
Repayment of finance lease obligations | (9) | (10) | (19) | |
(Decrease)/increase in bank loans | (245) | (52) | 54 | |
| Net cash (utilised in)/generated from financing activities | (254) | (62) | 35 | |
Net (decrease) in cash and cash equivalents | (5) | (73) | (90) | |
Cash and cash equivalents at start of period | 18 | 106 | 106 | |
Effect of foreign exchange rate changes | (1) | - | 2 | |
Cash and cash equivalents at end of period | 12 | 33 | 18 | |
Creightons plc
Interim financial report
For the six months ended 30 September 2013
Notes to the interim financial report
1. Basis of preparation
The condensed financial statements in this Interim Report have been prepared in accordance with the requirements of IAS 34 'Interim Financial Reporting' as adopted by the European Union.
As required by the Disclosure and Transparency Rules of the UK's Financial Conduct Authority, the condensed set of financial statements has been prepared by applying the accounting policies and presentation that were applied in the preparation on the Company's published consolidated financial statements for the year ended 31 March 2013, which were prepared in accordance with International Financial Reporting Standards as adopted by the European Union.
The condensed interim financial statements for the six months ended 30 September 2013 and the comparative figures for the six months ended 30 September 2012 are unaudited and have not been reviewed by the Auditors. The summary financial statements for the year ended 31 March 2013 represent an abbreviated version of the Group's full financial statements for that year, on which the Auditors issued an unqualified audit report and which have been filed with the Registrar of Companies.
2. Earnings per share
The calculation of the basic and diluted earnings per share is based on the following data:
Six months ended 30 September | Year ended 31 March | |||
2013 | 2012 | 2013 | ||
£000 | £000 | £000 | ||
Earnings | ||||
Net profit attributable to the equity holders of the parent company | 153 | 38 | 302 | |
Six months ended 30 September | Year ended 31 March | |||
2013 | 2012 | 2013 | ||
Number | Number | Number | ||
Number of shares | ||||
Weighted average number of ordinary shares for the purposes of basic earnings per share | 54,478,876 | 54,478,876 | 54,478,876 | |
Effect of dilutive potential ordinary shares relating to Share options | 5,176,550 | 5, 126,550 | 5,376,550 | |
Weighted average number of ordinary shares for the purposes of diluted earnings per share | 59,655,426 | 59,605,426 | 59,855,426 | |
3. Related party transactions
The related party transactions that occurred in the six months ended 30 September 2013 are not materially different in size or nature to those reported in the Company's Annual Report for the year ended 31 March 2013.
4. Availability of Interim Report
The Interim Report is being sent to shareholders. Further copies can be obtained from the Company's Registered Office, 1210 Lincoln Road, Peterborough, PE4 6ND.