Last checked at 13 Jun 2018 07:00
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
Dewhurst plc (the "Group")
Interim Results for the 6 months ended 31 March 2018
Directors' Interim Report
FIRST HALF
Although sales and profit fell in the first half of the year, on a constant currency basis and adjusting for a divested business, underlying sales were actually slightly up. Overall, Group revenue decreased by 5% to £24.7 million (2017: £26.1 million) and profit before tax decreased 4% to £2.8 million (2017: £3.0 million). Operating profit of £2.5 million (2017: £3.1 million) is down 19% on last year with earnings per share declining to 23.2p (2017: 25.8p).
As mentioned in the 2017 Full Year Statement, demand for keypads was weaker and this continued through the first half of 2018 and was the most significant contributor to the lower sales. Another significant negative impact on the results was the strengthening of Sterling. The currency movements had a 5% negative impact on both sales and profits to the value of £1.0 million and £0.2 million respectively. In addition we sold the door and cab division of ERM which reduced sales by £1.1m in the period. Elsewhere, Canada continued its strong growth, the UK businesses varied but overall were up, and Australia also varied, but with a full half year contribution from P&R was also up in total.
The Group balance sheet remains strong with cash at the period end of £18.0 million (2017: £16.0 million).
In the second half, after the date of the balance sheet reported here and as announced on 4 June 2018, Dewhurst acquired A. & A. Electrical Distributors Limited (A&A). The terms of the acquisition are set out in the announcement, but it will utilise a significant amount of the Group's free cash. However the acquisition is expected to be earnings enhancing in the second half.
OUTLOOK
In most of our markets the business climate seems to be reasonably positive at present. The exception remains the UK where there is still some uncertainty about the short term and the economic situation is highly dependent on political decisions. Although keypad sales have picked up a little in the last couple of months we do expect a declining trend on these products over the long term. However we expect to see a positive impact from the contribution of A&A. Current exchange rate levels will continue to be a drag on the Group, more so if Sterling were to further strengthen. The second half may see a period of consolidation, but on balance we are encouraged by the future growth prospects for the Group.
DIVIDENDS
The Directors have declared an interim dividend of 3.50p per ordinary share (2017: 3.50p) which amounts to £295,000 (2017: £295,000). The interim dividend is payable on 21 August 2018 and will be posted on 16 August 2018 to shareholders appearing in the Register on 6 July 2018 (ex-dividend date being 5 July 2018).
A final 2017 dividend of 8.50p (2016: 8.00p) which amounted to £716,000 (2016: £678,000) was approved at the AGM held on 8 February 2018 and was paid on 14 February 2018 to members on the register at 19 January 2018.
By Order of the Board
J C SINCLAIR
Finance Director & Secretary
12 June 2018
Dewhurst plc
The unaudited consolidated statement of comprehensive income, balance sheet, statement of changes in equity and cash flow statement of Dewhurst plc and its subsidiaries for the half-year ended 31 March 2018, as compared with the corresponding half-year ended 31 March 2017 and the year ended 30 September 2017, shows the following results:
Consolidated statement of comprehensive income
| Half year | Half year | Year |
| ended | ended | ended |
| 31 March | 31 March | 30 September |
| 2018 | 2017 | 2017 |
Continuing operations | £000's | £000's | £000's |
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|
|
Revenue | 24,669 | 26,070 | 52,890 |
Operating costs | (22,163) | (22,960) | (46,646) |
Operating profit | 2,506 | 3,110 | 6,244 |
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|
|
|
Profit on business divestment 1 | 439 | - | - |
Finance income | 52 | 52 | 117 |
Finance costs | (152) | (204) | (395) |
Profit before taxation | 2,845 | 2,958 | 5,966 |
Taxation | Est. (894) | Est. (773) | (1,345) |
Profit for the financial period | 1,951 | 2,185 | 4,621 |
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|
|
|
Other comprehensive income: |
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|
|
Actuarial gains/(losses) on the defined benefit pension scheme | Est. (485) | Est. 1,009 | 3,672 |
Current tax effect | - | - | - |
Deferred tax effect | 82 | (172) | (624) |
Total that will not be subsequently reclassified to income statement | (403) | 837 | 3,048 |
|
|
|
|
Exchange differences on translation of foreign operations | (1,393) | 577 | (104) |
Deferred tax effect | 237 | (98) | 18 |
Total that may be subsequently reclassified to income statement | (1,156) | 479 | (86) |
Other comprehensive income/(expense) for the period, net of tax | (1,559) | 1,316 | 2,962 |
Total comprehensive income for the period | 392 | 3,501 | 7,583 |
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|
|
Profit for the period attributable to: |
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|
|
Equity shareholders of the company | 1,822 | 2,112 | 4,445 |
Non-controlling interests | 129 | 73 | 176 |
| 1,951 | 2,185 | 4,621 |
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|
|
Total comprehensive income for the period attributable to: |
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|
|
Equity shareholders of the company | 336 | 3,396 | 7,428 |
Non-controlling interests | 56 | 105 | 155 |
| 392 | 3,501 | 7,583 |
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|
|
|
Basic and diluted earnings per share | 23.16p | 25.82p | 52.65p |
Dividends per share | 3.50p | 3.50p | 12.00p |
1 This relates to ERM selling its Winter & Bain division to Elevator Equipment Corporation
Dewhurst plc
Consolidated balance sheet
| Half year | Half year | Year |
| ended | ended | ended |
| 31 March | 31 March | 30 September |
| 2018 | 2017 | 2017 |
| £000's | £000's | £000's |
Non-current assets |
|
|
|
Goodwill | 4,252 | 4,829 | 4,575 |
Other intangibles | 94 | 89 | 98 |
Property, plant and equipment | 9,181 | 9,554 | 9,267 |
Deferred tax asset | 1,850 | 2,086 | 1,641 |
| 15,377 | 16,558 | 15,581 |
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Current assets |
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|
Inventories | 4,947 | 5,108 | 5,566 |
Trade and other receivables | 9,873 | 11,275 | 10,011 |
Cash and cash equivalents | 18,006 | 16,010 | 18,087 |
| 32,826 | 32,393 | 33,664 |
Total assets | 48,203 | 48,951 | 49,245 |
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Current liabilities |
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|
Trade and other payables | 5,139 | 5,824 | 5,567 |
Current tax liabilities | 239 | 223 | 368 |
Short-term provisions | 252 | 544 | 326 |
| 5,630 | 6,591 | 6,261 |
Non-current liabilities |
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|
|
Retirement benefit obligation | 11,716 | 14,890 | 11,751 |
Total liabilities | 17,346 | 21,481 | 18,012 |
Net assets | 30,857 | 27,470 | 31,233 |
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Equity |
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|
Share capital | 842 | 842 | 842 |
Share premium account | 157 | 157 | 157 |
Capital redemption reserve | 295 | 295 | 295 |
Translation reserve | 886 | 2,481 | 1,969 |
Retained earnings | 27,672 | 22,717 | 26,969 |
Total attributable to equity shareholders of the company | 29,852 | 26,492 | 30,232 |
Non-controlling interests | 1,005 | 978 | 1,001 |
Total equity | 30,857 | 27,470 | 31,233 |
Dewhurst plc
Consolidated statement of changes in equity
For the period ended 31 March 2018
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| ||||||
| Share | Share | Capital | Translation | Retained | Non | Total | ||||||
| capital | premium | redemption | reserve | earnings | controlling | equity | ||||||
|
| account | reserve |
|
| interest |
| ||||||
| £(000) | £(000) | £(000) | £(000) | £(000) | £(000) | £(000) | ||||||
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At 1 October 2017 | 842 | 157 | 295 | 1,969 | 26,969 | 1,001 | 31,233 | ||||||
Profit for the period | - | - | - | - | 1,822 | 129 | 1,951 | ||||||
Other comprehensive income and expense |
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|
|
|
|
| ||||||
Exchange differences on translation of foreign operations |
- |
- |
- |
(1,320) |
- |
(73) |
(1,393) | ||||||
Actuarial gains/(losses) on defined benefit pension scheme |
- |
- |
- |
- |
(485) |
- |
(485) | ||||||
Deferred tax effect | - | - | - | 237 | 82 | - | 319 | ||||||
Total comprehensive income | - | - | - | (1,083) | 1,419 | 56 | 392 | ||||||
Dividends paid | - | - | - | - | (716) | (52) | (768) | ||||||
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| ||||||
At 31 March 2018 | 842 | 157 | 295 | 886 | 27,672 | 1,005 | 30,857 | ||||||
For the period ended 31 March 2017
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| Share | Share | Capital | Translation | Retained | Non | Total | ||||||
| capital | premium | redemption | reserve | earnings | controlling | equity | ||||||
|
| account | reserve |
|
| interest |
| ||||||
| £(000) | £(000) | £(000) | £(000) | £(000) | £(000) | £(000) | ||||||
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At 1 October 2016 | 847 | 157 | 290 | 2,034 | 20,663 | 589 | 24,580 | ||||||
Profit for the period | - | - | - | - | 2,112 | 73 | 2,185 | ||||||
Other comprehensive income and expense |
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|
| ||||||
Exchange differences on translation of foreign operations |
- |
- |
- |
545 |
- |
32 |
577 | ||||||
Actuarial gains/(losses) on defined benefit pension scheme |
- |
- |
- |
- |
1,009 |
- |
1,009 | ||||||
Deferred tax effect | - | - | - | (98) | (172) | - | (270) | ||||||
Total comprehensive income | - | - | - | 447 | 2,949 | 105 | 3,501 | ||||||
Shares repurchased | (5) | - | 5 | - | (217) | - | (217) | ||||||
Shares Issued 2 | - | - | - | - | - | 311 | 311 | ||||||
Dividends paid | - | - | - | - | (678) | (27) | (705) | ||||||
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At 31 March 2017 | 842 | 157 | 295 | 2,481 | 22,717 | 978 | 27,470 | ||||||
2 This relates to P&R Liftcars Pty Ltd selling shares to Roy Peat in proportion to his 25% non-controlling interest.
Dewhurst plc
Consolidated statement of changes in equity (cont'd)
For the year ended 30 September 2017
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| Share | Share | Capital | Translation | Retained | Non | Total | ||||||
| capital | premium | redemption | reserve | earnings | controlling | equity | ||||||
|
| account | reserve |
|
| interest |
| ||||||
| £(000) | £(000) | £(000) | £(000) | £(000) | £(000) | £(000) | ||||||
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At 1 October 2016 | 847 | 157 | 290 | 2,034 | 20,663 | 589 | 24,580 | ||||||
Profit for the year | - | - | - | - | 4,445 | 176 | 4,621 | ||||||
Other comprehensive income and expense |
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| ||||||
Exchange differences on translation of foreign operations |
- |
- |
- |
(83) |
- |
(21) |
(104) | ||||||
Actuarial gains/(losses) on defined benefit pension scheme |
- |
- |
- |
- |
3,672 |
- |
3,672 | ||||||
Deferred tax effect | - | - | - | 18 | (624) | - | (606) | ||||||
Total comprehensive income | - | - | - | (65) | 7,493 | 155 | 7,583 | ||||||
Shares repurchased | (5) | - | 5 | - | (217) | - | (217) | ||||||
Shares issued 2 | - | - | - | - | - | 311 | 311 | ||||||
Dividends paid | - | - | - | - | (970) | (54) | (1,024) | ||||||
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| ||||||
At 30 September 2017 | 842 | 157 | 295 | 1,969 | 26,969 | 1,001 | 31,233 | ||||||
2 This relates to P&R Liftcars Pty Ltd selling shares to Roy Peat in proportion to his 25% non-controlling interest.
These half-year abbreviated financial statements are unaudited and do not constitute statutory accounts within the meaning of Section 435 of the Companies Act 2006. The results for the year ended 30 September 2017 set out above are abridged. Full accounts for that year reported under IFRS, on which the auditors of the Company made an unqualified report have been delivered to the Registrar of Companies.
The presentation of these Interim Financial Statements is consistent with the 2017 Financial Statements and its accounting policies, but where necessary comparative information has been reclassified or expanded from the 2017 Interim Financial Statements to take into account any presentational changes made in the 2017 Financial Statements or in these Interim Financial Statements.
Dewhurst plc
Consolidated cash flow statement
| Half year | Half year | Year |
| ended | ended | ended |
| 31 March | 31 March | 30 September |
| 2018 | 2017 | 2017 |
| £000's | £000's | £000's |
Cash flows from operating activities |
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|
|
Operating profit | 2,506 | 3,110 | 6,244 |
Depreciation and amortisation | 431 | 406 | 975 |
Additional contributions to pension scheme | (673) | (673) | (1,343) |
Exchange adjustments | (706) | 178 | (49) |
(Profit)/loss on disposal of property, plant and equipment | (9) | (9) | 21 |
| 1,549 | 3,012 | 5,848 |
(Increase)/decrease in inventories | 619 | (8) | (703) |
(Increase)/decrease in trade and other receivables | 138 | (974) | 290 |
Increase/(decrease) in trade and other payables | (428) | 337 | 202 |
Increase/(decrease) in provisions | (74) | (10) | (228) |
Cash generated from operations | 1,804 | 2,357 | 5,409 |
Interest paid | - | - | (2) |
Tax paid | (681) | (725) | (968) |
Net cash from operating activities | 1,123 | 1,632 | 4,439 |
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Cash flows from investing activities |
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Acquisition of business and assets | - | (1,356) | (933) |
Proceeds from business divestment 1 | 439 | - | - |
Proceeds from sale of property, plant and equipment | 12 | 25 | 52 |
Purchase of property, plant and equipment | (554) | (601) | (978) |
Development costs capitalised | - | - | (82) |
Interest received | 52 | 52 | 117 |
Net cash generated from/(used in) investing activities | (51) | (1,880) | (1,824) |
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Cash flows from financing activities |
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Issue of share capital - non-controlling interest element 2 | - | 311 | - |
Purchase of own shares | - | (217) | (217) |
Dividends paid | (768) | (705) | (1,024) |
Net cash used in financing activities | (768) | (611) | (1,241) |
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Net increase/(decrease) in cash and cash equivalents | 304 | (859) | 1,374 |
Cash and cash equivalents at beginning of period | 18,087 | 16,674 | 16,674 |
Exchange adjustments on cash and cash equivalents | (385) | 195 | 39 |
Cash and cash equivalents at end of period | 18,006 | 16,010 | 18,087 |
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1 This relates to ERM selling its Winter & Bain division to Elevator Equipment Corporation
2 This relates to P&R Liftcars Pty Ltd selling shares to Roy Peat in proportion to his 25% non-controlling interest.
For further details please contact:
Dewhurst Plc Tel: +44 (0) 208 744 8200
Richard Dewhurst, Chairman
Jared Sinclair, Finance Director
www.dewhurst.plc.uk
Cantor Fitzgerald Europe Tel: +44 (0) 207 894 7000
David Foreman / Will Goode (Corporate Finance)
Alex Pollen (Sales)