Tclarke Regulatory News (CTO)

9 Mar 2007 07:01

Clarke(T.) PLC09 March 2007 CONFIDENT T CLARKE LIFTS DIVIDEND AS ORDER BOOK SWELLS T. Clarke plc, the electrical engineering and contracting company, has announcedits preliminary results for the year ended 31 December 2006. • Adjusted profit before interest and non-recurring items £7.07m (2005:£7.55m) • Profit Before Tax £6.57m (2005: £8.55m) • Turnover £186m (2005: £194m) • Basic EPS 11.30p (2005: 14.30p) • Final Dividend up to 7.35p (2005: 7.0p) • Order book £210m (2005: £165m) • Total Dividend for the year up to 11.025p (2005: 10.5p) Major completions include: - Allen & Overy, Bishops Square, Bishopsgate, London - Traction Power and LUL Sidings, White City - Romford and Havering Hospital - Unilever House, Blackfriars, London - Nomura House, London - Hilton Hotel, Tower Bridge Current projects include: - 02 Arena, London - Shell Centre, Waterloo - Mizuho International, London - 201 Bishopsgate and Broadgate Tower, London - White City Retail Development, London - RBS, Aldgate Union, London Major projects won include: - 02 Waterfront, London - Chiswick Park, Buildings 7 & 8, London - Bow Bells House, Cheapside, London - Senate House, University of London - Shard of Glass, enabling works, SE1 Pat Stanborough, Chief Executive commented: " This has been a challenging year for the group. However, the future looksbright. Our major clients are busy and we have secured a very strong order bookworth over £200million. Many of our end-users are planning major expansion andinvestment programmes, which bodes well for the continued improvements in ourmarkets. " We have taken steps to strengthen the management of both the core Londonoperations and our regional businesses. Looking to the medium term, the Group isin very good shape and we are well positioned to deliver further improvement inmargins. Reflecting our confidence in the future, we have raised the finaldividend." -ends- Date: 9 March 2007For further information contact: T. Clarke plc cityPROFILEPat Stanborough, Chief Executive Simon CourtenayJohn Daly, Finance Director Tel: 020-7448-3244Tel: 020-7358-5000web: www.tclarke.co.uk PRELIMINARY STATEMENT 2006 proved to be a challenging year for the group. We experienced mixedfortunes across the business. Profit before tax, interest and non-recurringitems fell by 6% to £7.07m (2005: £7.55m) on revenue that fell by 4% to £186m(2005: £194m). Profit before tax was £6.57m (2005: £8.55m). Earnings per share were 11.30p(2005: 14.30p). However, despite the difficulties experienced in 2006, thefuture prospects for the group are more positive. Given the Board's confidencein a return to more favourable market conditions and an improved overallperformance in 2007, the Board recommends an increase in the final dividend to7.35p (2005: 7.0p) giving a total dividend for the year of 11.025p (2005: 10.5p). We have a clear and defined strategy to deliver growth. We are striving toimprove performance throughout our group and enhance our leading position withinour market sectors. Our core business has performed well and our Londonoperations managed an improvement in margin and delivered an improved result.Whilst most of our regional companies contributed good results, there weredisappointments in Scotland, Derby and East Anglia. Senior management changeshave taken place and improved financial controls have been implemented.Administrative expenses are being addressed and we are confident in an overallimprovement in margins across our regional businesses. BOARD CHANGES We were pleased to announce in December 2006 that Barry DeFalco was appointedManaging Director UK Regions and Mark Lawrence was appointed as ManagingDirector for our London Operations. These appointments have been made toincrease the focus on these sectors and to establish the right platform fromwhich we can increase revenue and profit in 2007 and onwards. Michael 'Mike' Crowder was appointed as an Executive Director on 1st January2007. Mike has an excellent range of experience and as a Divisional Director ofour London core operations he played a key role in the restructuring andimprovement in the recent performance of these operations. This appointment is in advance of Pat Stanborough the Group's current ChiefExecutive retiring from the Board in October 2008. It is currently not theintention to appoint another Executive Director. OUTLOOK The business is in good shape. We have made a promising start to 2007. The Grouphas enjoyed a good order intake during January and February across many of ourdivisions. Our major clients in commercial property development areexceptionally busy and there are exciting opportunities ahead of us. Our enduser clients, who include major banks and retail outlets, are currentlyundertaking expansion programmes which should lead to an increase in workthrough 2007/8. Our current order book stands at £210m (2005: £165m), of which£170m is due for completion during 2007. Overall we are confident in our strategy to deliver growth. The Board is lookingto the future with confidence. LONDON OPERATIONS Revenue £80m (2005: £92m)Profit from operations £3.70m (2005: £2.43m)Margin 4.6% (2005: 2.6%)Order Book £110m (2005: £75m) Completions during the year included: Allen & Overy, Bishops Square; Traction Power and LUL Sidings, White City;Romford and Havering Hospital; Unilever House, Blackfriars; Nomura House andHilton Hotel, Tower Bridge. Current projects include: 02 Arena, Greenwich; Shell Centre, Waterloo; Mizuho International; GlobalSwitch; 201 Bishopsgate and Broadgate Tower; White City Shopping Development,and RBS Aldgate Union. Recently won contracts include: 02 Waterfront, Greenwich; Chiswick Park, Buildings 7 & 8; Bow Bells House,Cheapside; University of London, Senate House and The Shard of Glass, EnablingWorks. REGIONAL BUSINESSES Revenue £106m (2005: £102m)Profit from operations £2.86m (2005: £4.65m)Margin 2.7% (2005: 4.6%)Order Book £100m (2005: £90m) Completions during the year included: The Grand Theatre, Leeds; Drakes Circus Shopping Centre, Plymouth; Barry TownHall; Golden Jubilee National Hospital, Clydebank; Durham University, StudentAccommodation; Clegg Foods, Bury St. Edmunds; Norwich City Sports Club;Warrington Bus Depot; Altrincham Girls Grammar School; KIA London ManstonAirport; and various Waitrose Supermarkets Current projects include: Gartnavel Hospital, Glasgow; Bluecoat Arts Centre, Liverpool; Home Office Pay &Pensions, Liverpool; Lindholme Prison; Kestrel Court, Portishead; Grand ArcadeShopping Centre, Cambridge; Framwell Gate Hotel, Durham; Clegg Foods, Glasgow;Addenbrookes Rosie Maternity Unit, Cambridge; Peterborough District Hospital andvarious Waitrose Stores. Recently won contracts include: Cala Homes, Stirling; New British Red Cross Building, Truro; SheffieldUniversity Arts Tower; Strode College, Worcester; Marks & Spencer, Cheshunt;Wilton Plaza, London; Preston Hospital, JD Sports, Wigan; Pharmaceutical Unit;Victoria Building, Liverpool and various Waitrose Stores. PROPERTIES Rental Income £0.66m (2005: £0.64m)Profit from operations £0.51m (2005: £0.47m)Net Gain on Disposals NIL (2005: £1m)Freehold Property (Book Values) £5.8m (2005: £5.94m) All properties are currently leased to group companies. FINANCIAL REVIEW Revenue and Operating ProfitRevenue was down 4% to £186m (2005: £194m). London core operations revenue fellby 13% to £80m; Regional businesses revenue increased by 4% to £106m. Group operating profit, before interest and non-recurring items fell by 6% to£7.07m (2005: £7.55m). Although London operations revenue fell during the year(due to contract slippages) there was an encouraging improvement in margin whichresulted in an increase in operating profit of 52% to £3.7m (2005: £2.4m).Regional businesses however were badly hit by copper price escalation andcontract losses, which resulted in a fall in operating profits of 38% to £2.86m(2005: £4.65m). Profit Before and After TaxProfit before tax of £6.57m was down 23% against last years £8.55m. This isafter net interest charges of £0.15m (2005: £0.05m), and non-recurring costs of£0.35m (2005: gain on sale of properties: £1m). Non-recurring costs in theperiod were legal costs relating to the tax investigation into a subsidiarycompany. The tax charge was £2.06m (2005: £2.84m) giving an effective tax rateof 31% (2005: 33%). Earnings per Share and DividendsBasic earnings per share fell by 21% to 11.30p (2005: 14.3p). The final dividendis proposed at 7.35p (2005: 7.0p) giving a total dividend for the year of11.025p which is 5% higher than last year (2005: 10.5p). The proposed dividendwill be paid on 8th May 2007 to shareholders on the register at 10th April 2007. Equity and Capital StructureEquity was £22.78m (2005: £22.59m). The number of shares in issue at 31stDecember 2006 was 39,947,889 (2005: same). Cash Flow and TreasuryNet cash from operating activities was £5.2m (2005: £3.5m) as a result ofimprovements in working capital. Net capital expenditure was £0.3m (2005:£4.6m). After payments for tax, dividends and servicing of finance the netincrease in cash and cash equivalents was £0.35m (2005: decrease of £6.3m)resulting in a year end balance of £5.18m (2005: 4.83m). It is anticipated thatthere will be improved cash generation in 2007. Consolidated income statementfor the year ended 31st December 2006 2006 2005 £ £Revenue 186,334,361 193,729,126Cost of sales 159,217,792 165,848,318--------------------------------------------------------------------------------Gross profit 27,116,569 27,880,808Administrative expenses 20,393,707 19,281,931--------------------------------------------------------------------------------Profit from operations 6,722,862 8,598,877Investment income / (finance cost) (146,469) (44,584)--------------------------------------------------------------------------------Profit before taxation 6,576,393 8,554,293Taxation 2,062,914 2,844,506--------------------------------------------------------------------------------Profit for the period 4,513,479 5,709,787from continuing operations--------------------------------------------------------------------------------Earnings per share 11.30 pence 14.30 pence--------------------------------------------------------------------------------All the revenue & profit arose from continuing operations. Group statement of recognised income & expense 2006 2005 £ £--------------------------------------------------------------------------------Actuarial losses on defined benefit pension scheme (85,000) (538,000)--------------------------------------------------------------------------------Tax on items taken directly to equity 25,000 161,000--------------------------------------------------------------------------------Net expense recognised directly in equity (60,000) (377,000)--------------------------------------------------------------------------------Profit for the period 4,513,479 5,709,787--------------------------------------------------------------------------------Total recognised income & expenses for the period 4,453,479 5,332,787-------------------------------------------------------------------------------- Consolidated balance sheetat 31st December 2006 2006 2005 £ £--------------------------------------------------------------------------------Non current assets 14,384,649 14,384,649Goodwill 7,965,150 8,384,102Tangible fixed assets 66,034 61,360Deferred taxation-------------------------------------------------------------------------------- 22,415,833 22,830,111--------------------------------------------------------------------------------Current assets 370,424 353,788Inventories 14,000,680 17,361,059Construction contracts 23,025,127 21,953,722Debtors 5,182,287 4,828,646Cash and cash equivalents-------------------------------------------------------------------------------- 42,578,518 44,497,215--------------------------------------------------------------------------------Total assets 64,994,351 67,327,326--------------------------------------------------------------------------------Current liabilities 2,274,000 2,311,047Bank overdraft and loans 33,127,135 35,125,983Creditors and accruals 1,768,501 2,273,299Corporation tax liabilities 310,624 338,914Obligations under finance leases-------------------------------------------------------------------------------- 37,480,260 40,049,243--------------------------------------------------------------------------------Net current assets 5,098,258 4,447,972--------------------------------------------------------------------------------Non current liabilities 4,441,000 4,284,000Retirement benefit obligation 73,878 66,858Deferred taxation 220,302 337,356Obligations under finance leases-------------------------------------------------------------------------------- 4,735,180 4,668,214--------------------------------------------------------------------------------Total liabilities 42,215,440 44,737,457--------------------------------------------------------------------------------Net assets 22,778,911 22,589,869--------------------------------------------------------------------------------Equity 3,994,789 3,994,789Share capital 1,233,711 1,233,711Share premium 31,975 33,307Revaluation reserve 17,518,436 17,328,062Profit and loss account--------------------------------------------------------------------------------Total equity 22,778,911 22,589,869-------------------------------------------------------------------------------- Consolidated cash flow statement for the year ended 31st December 2006 2006 2005 £ £--------------------------------------------------------------------------------Net cash from operating activities 5,201,113 3,535,068--------------------------------------------------------------------------------Investing activities 114,495 243,192Interest received (470,636) (1,438,327)Purchase of tangible fixed assets 195,613 1,531,114Receipts on disposal of fixed assets - (4,717,208)Acquisition of subsidiaries--------------------------------------------------------------------------------Net cash used in investing activities (160,528) (4,381,229)--------------------------------------------------------------------------------Financing activities (4,264,437) (4,061,369)Equity dividends paid (385,460) (325,588)Repayments of obligations under finance leases (37,047) (1,148,908)Decrease in bank overdrafts--------------------------------------------------------------------------------Net cash used in financing activities (4,686,944) (5,535,865)--------------------------------------------------------------------------------Net increase / (decrease) in cash and cashequivalents 353,641 (6,328,026)Cash and cash equivalents at beginning of period 4,828,646 11,210,672--------------------------------------------------------------------------------Cash and cash equivalents at end of period 5,182,287 4,828,646-------------------------------------------------------------------------------- Consolidated statement of changes in equityfor the year ended 31st December 2006 2006 2005 £ £--------------------------------------------------------------------------------Balance at start of period 22,589,869 20,318,451Profit for period 4,513,479 5,709,787Interim dividend paid (1,468,085) (1,398,176)Prior year final dividend paid (2,796,352) (2,663,193)Actuarial losses on defined benefit pension scheme (85,000) (538,000)Corporation tax provision on pension benefits 25,000 161,000Shares issued on acquisition - 16,886Premium on shares issued - 983,114--------------------------------------------------------------------------------Balance at end of period 22,778,911 22,589,869 -------------------------------------------------------------------------------- Notes :- 1. The earnings per share represents the profit for the year on ordinaryactivities after taxation divided by the number of ordinary shares in issue. Thenumbers of ordinary shares, being a weighted average, for the purpose of thiscalculation, is 39,947,889 (2005: 39,938,174). 2. The figures for the year ended 31 December 2006 have been extracted from thefull unaudited accounts for the year. The figures have been prepared andcompiled in accordance with International Financial Reporting Standards. Thecomparative figures for the year ended 31 December 2005 have been taken from,but do not constitute, the group's statutory accounts for the year. Thosestatutory accounts have been reported on by the group's auditors and have beendelivered to the Registrar of Companies. The report of the auditors wasunqualified and did not contain a statement under section 237 (2) or (3) of theCompanies Act 1985. 3. Copies of the annual report and accounts will be posted to shareholdersshortly. Further copies can be obtained from the Company's registered office;Stanhope House, 116-118 Walworth Road, London, SE17 1JY. 4. The Company's Annual General Meeting will be held at Savoy Place,London WC2 on Friday 4th May 2007 at 12 noon. 5. Subject to the approval of shareholders the final dividend of7.35 pence per share will be paid on 8th May 2007. The shares will goex-dividend on 4th April 2007. The records will close on 10th April 2007. This information is provided by RNS The company news service from the London Stock Exchange