14 Feb 2012 07:00
Holders Technology plc Providers of PCB materials, LED components and lighting solutions. Audited results for the year ended 30 November 2011
Holders Technology plc ("Holders Technology" or "the Group") announces its audited results for the year ended 30 November 2011.
Holders Technology's Printed Circuit Board ("PCB") divisions overall had stronggrowth in the first half, then contraction in the second half. The lighting andLED businesses grew throughout the year, albeit from a lower base. HoldersTechnology recorded the following results: * Revenue for the year grew 20% to £19.6m (2010: £16.3m) * LED revenue grew 317% to £3.2m * Gross profit of £4.5m (2010: £4.2m) * Operating profit of £0.4m (2010: £0.5m profit) * Proposed final dividend of 3.25p (2010: 3.25p)
Chairman's statement
In my statement accompanying the half year results for the year ending 30thNovember 2011 I was able to say that the strong growth which we had seen in ourPCB business in the preceding year had continued, particularly in our Germanoperations. This position changed very significantly in the second half of theyear adversely impacting our PCB operations in mainland Europe.The positive points regarding our PCB operations were that we continued to seethe benefits of our extended and renewed product range which enabled us toreduce the tendency for margins to come under severe pressure during times ofturnover decline.In periods of great economic uncertainty it is inevitable that reductions inend user demand will be magnified by a tendency for our customers, theirsuppliers, to de-stock, this was the case in the second half of the year. We donot believe that we have lost ground to competitors in the PCB markets which weserve.The growth in total turnover which the Group saw in the year to 30th November2011 was due to the LED sector of the Group's business. Our UK LED activities,being more established, made the greatest contribution to this growth but inthe closing months of the year our European operations, benefiting from theinfrastructure investment we have made, began to make significant progress.
The year overall was a financially testing one for the Group. The strong turnover growth achieved in our new LED business required significant investment in stock and other working capital but our traditional financial strength enabled us to accommodate these requirements despite profitability being constrained.
It was encouraging that, in addition to extending our LED infrastructure toserve the European market, we were also successful in expanding the range ofproducts we are able to offer. This enhanced range was augmented by a number ofcustomised modules tailored to selected product markets. Our ability to utiliseassembly services from our other various facilities materially assisted in thisprocess.The strategy we have pursued in the PCB market of seeking to offer acomprehensive service covering both high volume commodity products and morespecialist niche products, has enabled us successfully to weather the cyclicalswings in that business. While applying the same general principles to our LEDactivities we will also heighten our concentration on providing completelighting solutions to selected industrial and commercial segments of themarket.As in previous years I would like to record the Board's thanks to all of ouremployees who have responded well to the challenges which the last year gaverise to; we value their support. The year saw Paul Geraghty join the Board asFinancial Director. I am pleased to be able to report that Jim Shawyer, whoheld that post for eleven years, has agreed to continue as a consultant to theGroup.The current problems in the Euro area coupled with an uncertain UK economy andthe volatility of exchange rates makes the task of predicting the outcome forthe current year particularly difficult. The opening months of the currentfinancial year have seen a marked decline in our PCB business but, as a Group,we have the benefit of considerable experience in weathering downturns in thePCB industry by balancing the need to preserve revenues whilst strictlycontrolling costs and this we are continuing to do.
In contrast to the PCB market, the LED market continues to experience rapid growth. To ensure that we have the capability to serve our defined areas of this market we will, in the current year, continue to make significant further investments designed to ensure we are able to build a secure platform for sustained growth in future years.
In summary, we foresee the current year as one of both significant challenge and great opportunity.
R W Weinreich
Chairman and Chief Executive
13 February 2012
Consolidated income statement
for the year ended 30 November 2011
Total Total Note 2011 2010 £'000 £'000 Continuing operations Revenue 19,636 16,314 Cost of sales (15,127) (12,116) Gross profit 4,509 4,198 Distribution costs (404) (390) Administrative expenses (3,828) (3,273) Impairment of goodwill 2 - (57) Acquisition costs 2 - (26) Other operating income/ 98 39 (expenses) Operating profit/(loss) 375 491 Finance costs (12) (1) Profit before taxation 363 490 Tax expense 3 (123) (59) Profit for the year 240 431
Profit for the year attributable
to: Owners of the parent 264 507 Non-controlling interest (24) (76) Profit for the financial year 240 431 Total and continuing Basic earnings per share 5 6.70p 12.87p Diluted earnings per share 5 6.63p 12.87p
Consolidated statement of comprehensive income
for the year ended 30 November 2011
Group 2011 2010 £'000 £'000 Profit for the year 240 431
Reclassification adjustment related to 412
- terminated foreign operations
Exchange differences on translating 60
(180) foreign operations
Total comprehensive income for the 712
251 year
Total comprehensive income for the year
attributable to: Owners of the parent 788 305 Non-controlling interests (76) (54) 712 251
Statements of changes in equity
Group Share Share Capital Translation Retained
Total Non-controlling Total
capital premium redemption reserve earnings attributable interest equity reserve to owners of parent £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Balance at 1 December 416 1,531 1 831 2,972 5,751 145 5,896 2009 Dividends - - - - (211) (211) - (211) Employee share-based - - - - (4) (4) - (4) payment options Transactions with - - - - (215) (215) - (215) owners Profit/(loss) for the - - - - 507 507 (76) 431 year
Non-controlling interest - - - - -
- - - investment
Exchange differences on - - - (202) - (202) 22 (180) translating foreign operations Total comprehensive - - - (202) 507 305 (54) 251 income for the year Balance at 30 November 416 1,531 1 629 3,264
5,841 91 5,932 2010 Dividends - - - - (211) (211) - (211)
Employee share-based - - - - (4)
(4) - (4) payment options Transactions with - - - - (215) (215) - (215) owners Profit/(loss) for the - - - - 264 264 (24) 240 year Reclassification (412) 412 - - - adjustment related to terminated foreign operations Exchange differences on - - - 51 - 51 9 60 translating foreign operations Total comprehensive - - - (361) 676 315 (15) 300 income for the year Balance at 30 November 416 1,531 1 268 3,725 5,941 76 6,017 2011 Company Share Share Capital Retained Total capital premium redemption earnings equity reserve £'000 £'000 £'000 £'000 £'000
Balance at 1 December 2009 416 1,531 1 939 2,887 Loss and total comprehensive income - - - (185) (185) for the period Dividends - - - (211) (211)
Share-based payment charge - - - (4)
(4)
Balance at 30 November 2010 416 1,531 1 539
2,487
Profit and total comprehensive income - - - 404
404 for the period Dividends - - - (211) (211) Share-based payment charge - - - (4) (4)
Balance at 30 November 2011 416 1,531 1 728
2,676 Balance sheetsat 30 November 2011Company number: 1730535 Group Company 2011 2010 2011 2010 £'000 £'000 £'000 £'000 Assets Non-current assets Goodwill 318 318 - -
Property, plant and equipment 576 582 29 3 Investments in subsidiaries - - 2,780 3,622 Investment in joint venture - - 15
15 Investments in associates - - - - Deferred tax assets 66 73 - - 960 973 2,824 3,640 Current assets Inventories 3,834 3,826 - -
Trade and other receivables 2,951 2,721 676
423 Current tax assets 95 56 - - Cash and cash equivalents 67 888 15 63 6,947 7,491 691 486 Liabilities Current liabilities Trade and other payables (1,591) (2,182) (766) (1,562) Borrowings (26) (52) (6) - Current tax liabilities (35) (55) (33) (32) (1,652) (2,289) (805) (1,594) Net current assets 5,295 5,202 (114) (1,108) Non-current liabilities Borrowings - (4) - -
Retirement benefit liability (167) (192) -
- Contingent consideration (29) (45) (29) (45) Deferred tax liabilities (28) (2) (5) - (224) (243) (34) (45) 6,017 5,932 2,676 2,487 Shareholders' equity Share capital 416 416 416 416 Share premium account 1,531 1,531 1,531 1,531 Capital redemption reserve 1 1 1 1 Retained earnings 3,725 3,264 728 539 Cumulative translation 268 629 - - adjustment reserve Equity attributable to the 5,941 5,841 2,676 2,487shareholders of the parent Non-controlling interest 76 91 - - 6,017 5,932 2,676 2,487 Cash flow statements
for the year ended 30 November 2011
Group Company 2011 2010 2011 2010 £'000 £'000 £'000 £'000 Cash flows from operating activities Operating profit/(loss) 375 491 (158) (117) Share-based payment credit (4) (4) (4) (4) Depreciation 144 152 3 1 Impairment of goodwill - 57 - - Impairment of fixes assets 20 - - - Currency translation 40 (137) - - (Gain)/ Loss on sale of (16) 16 - -property, plant and equipment (Increase)/decrease in (8) (1,870) - -inventories
(Increase)/decrease in trade and (257) (274)
(253) 67other receivables
Increase/(decrease) in trade and (582) 867
(796) 1,108other payables Movement in contingent (16) (16) consideration Investment in subsidiary fair 16 value adjustment Cash (used in)/generated from (304) (702) (1,208) 1,055operations
Corporation tax (paid)/received (155) (75)
(156) 157
Net cash (used in)/generated (459) (777) (1,364) 1212from operations Cash flows from investing activities
Net borrowings acquired with - (44)
-subsidiary undertaking Increase in investment in - - - (1,296)subsidiaries Proceeds from disposal of - - 1,157 67subsidiary
Purchase of property, plant and (137) (118)
(29) (1)equipment
Proceeds from sale of property, plant 24 (21)
- -and equipment Income from investments - - 77 160 Interest received - - 6 5
Net cash (used in)/generated from (113) (141) 1,211 (1,065)investing activities Cash flows from financing activities Interest paid (12) (1) (2) - Loan repayments (27) (26) - - Finance lease principal (3) (3) - -repayments Equity dividends paid (211) (211) (211) (211) Net cash used in financing (253) (241) (213) (211)activities Net change in cash and cash (825) (1,159)
(54) (64)equivalents
Cash and cash equivalents at 888 2,095
63 127start of period
Effect of foreign exchange rates 4 (48)
- -
Cash and cash equivalents at end 67 888
9 63of period Notes 1. Basis of preparation The Group and parent company financial statements have been prepared inaccordance with EU endorsed International Financial Reporting Standards (IFRS),International Financial Reporting Interpretations Committee (IFRIC)interpretations and with those parts of the Companies Act applicable tocompanies reporting under IFRS. All accounting standards and interpretationsissued by the International Accounting Standards Board and the InternationalFinancial Reporting Interpretations Committee effective at the time ofpreparing these financial statements have been applied.
2. Exceptional items
Exceptional items consist of the following:
2011 2010 £'000 £'000 Impairment of goodwill - (57) Acquisition costs - (26) - (83) The impairment of goodwill in 2010 derives from the directors' assessment ofgoodwill attributable to Holders' Far East operations. The acquisition costs in2010 relate to the acquisition of JK Components Limited (since renamed HoldersComponents Limited) in December 2009. 3. Taxation 4. 2011 2010 £'000 £'000
Analysis of the charge in the period
Current tax - Current period 91 136
- Adjustments in respect of prior periods 5 (27)
96 109 Deferred tax 27 (50) Total tax 123 59 Tax reconciliation
The tax for the period is higher (2010: lower) than the standard rate of corporation tax in the UK, effectively 26.67% (2010: 28%) for the company's financial year. The differences are explained below:
2011 2010 £'000 £'000
Profit/(loss) before taxation 363 490
Profit/(loss) before taxation multiplied by 92 137 rate of corporation tax in the UK of 26.67 %
(2010: 28%) Effects of:
Differences between capital allowances and 6 (2)
depreciation
Amounts not deductible for taxation purposes 46 23
Non taxable income (42) -
Adjustments in respect of prior years 5 (27)
Taxation losses 11 (74) Other temporary differences 5 2 Taxation 123 59
4. The directors have proposed a final dividend of 3.25p per share payable on
22 May 2012 to shareholders on the register at close of business on 4 May
2012. The total dividend for the year, including the interim dividend of
2.1p (2010: 2.1p) per share paid on 4 October 2011, amounts to £211,000
(2010: £211,000), which is equivalent to 5.35p (2010: 5.35p) per share.
5. The basic earnings per share are based on the earnings for the financial
year attributable to the equity shareholders of £264,000 (2010: £507,000)
and on ordinary shares 3,939,551 (2010: 3,939,551), the weighted average
number of shares in issue during the year, excluding treasury shares.
Diluted earnings per share are based on 3,979,008 ordinary shares (2010:
3,939,551), being the weighted average number of ordinary shares after an
adjustment of 39,457 shares (2010: nil) in relation to share options.
6. This preliminary statement, which has been approved by the Board on 13
February 2012, is not the Company's statutory accounts. The statutory
accounts for each of the two years to 30 November 2010 and 30 November 2011
received audit reports, which were unqualified and did not contain
statements under section 498(2) and section 498(3) of the Companies Act
2006. The 2010 accounts have been filed with the Registrar of Companies but
the 2011 accounts are not yet filed.
ENDS For further information, contact:
Mr Rudi Weinreich, Executive Chairman, Holders Technology plc,
on 020 8236 1490
Mr Paul Geraghty, Group Finance Director, Holders Technology plc,
on 020 8236 1490
Mr Shane Gallwey, Director, Corporate Finance, Northland Capital Partners Ltd,
on 020 7796 8823
Website www.holderstechnology.com
XLON