HDT.L Regulatory News (HDT)

19 Feb 2008 07:00

Holders Technology PLC19 February 2008 Holders Technology plc Providers of specialised materials, equipment and services to the electronics industry Audited results for the year ended 30 November 2007 Holders Technology plc announces its audited results for the year ended 30November 2007. 2007 was a year of solid progress for the group, with improved profitability andstrong cash flow. • Operating profit grew 20% to £1.2m• Revenue was steady at £18.9m• £2.0m cash generated from operations• Indian Joint Venture established• Proposed 8.3% increase in final dividend to 3.25p Chairman's statement The improved trading performance achieved in the first half of the year wasmatched in the second half of the year leading to a positive out turn for theyear to 30 November 2007. Given the successful trading in the year, your boardconsiders it appropriate to recommend a final dividend of 3.25p (2006 3.00p). Operating profit of £1.2m (2006: £1.0m) combined with tight control of workingcapital led to £2.0m (2006: £0.6m) of cash being generated from operations,before tax payments. The group has maintained a strong balance sheet, with netcash of £1.1m at the end of the year. The UK operations traded strongly while our German and Dutch operations broadlyheld their ground during a period which saw worldwide rises in the price ofcopper and aluminium foils, product lines of particular importance to our Germansubsidiary. The continuing marked contraction of the Scandinavian PCB marketinevitably impacted adversely on our Swedish subsidiary, but strict control ofoverheads enabled the company to breakeven at operating profit level and to holdthe pre tax loss to an immaterial amount. Our Indian joint venture, which commenced trading only in April 2007, achievedpre tax breakeven albeit on modest levels of turnover. We believe that theIndian market has excellent potential to grow over the medium term and that ourentry into the market at this stage makes us well placed to benefit from theanticipated growth of this market in future years. The Chinese PCB industry continues to expand and is now the world's premier PCBproducer. We will continue our investment programme to address this marketopportunity. Taken together, our Chinese activities achieved breakeven at thepre tax level in the year. We are appraising opportunities further to develop the company's business inareas complementary to our existing core activity of supplying the PCB industry.A number of opportunities have been examined, but as yet we have been unableto identify a suitable proposition available on terms which we considerattractive to shareholders. The continuing strength of our balance sheetcoupled with our strong banking relationships would enable us to completesuitable transactions and it is now clear that the range of possibleopportunities both justifies and requires a greater level of managementcommitment. To this end Victoria Blaisdell, who has served as the Group's ITDirector for the past three years, has been appointed to the Company's board asCorporate Development Director in order to enable us to devote more resource tothis process. The move to restructure our operations in order to devolve responsibility to theoperating subsidiaries has been successfully completed and on behalf of theboard I would like to thank staff for their efforts during the year, sometimesin trying circumstances. There are clear signs that economic activity in Europe is weakening and we arebasing our plans on the assumption that demand in our main markets in 2008 willbe lower than in 2007. We will seek rigorously to contain our costs so as tominimise the impact of this expected lower level of activity on ourprofitability while continuing to invest in our young subsidiaries in the growtheconomies of India and China and seeking to make selective, earnings enhancingacquisitions. If approved by shareholders at the AGM, we will pay the dividend on 20 May 2008to shareholders on the register on 25 April 2008. R W WeinreichChairman and Chief Executive18 February 2008 Consolidated income statementfor the year ended 30 November 2007 Note 2007 2006 £'000 £'000Continuing operationsRevenue 18,853 18,822Cost of sales (13,866) (13,891) Gross profit 4,987 4,931 Distribution costs (463) (446)Administrative expenses (3,398) (3,561)Deferred consideration arising on sale of former subsidiary - 39Other operating income 76 38 Operating profit 1,202 1,001 Finance income 27 9Finance expenses (23) (26)Share of loss of associate - (25) Profit before taxation 1,206 959 Taxation 2 (454) (390) Profit after taxation 752 569 Attributable to: Equity shareholders of the company 744 591Minority interests - equity 8 (22) Profit for the financial year 752 569 Total and continuing Basic earnings per share 4 17.97p 14.24p Diluted earnings per share 4 17.78p 14.24p Consolidated balance sheetat 30 November 2007 Note 2007 2006 £'000 £'000AssetsNon-current assetsGoodwill 397 413Property, plant and equipment 622 506Investments in subsidiaries - -Investment in joint venture - -Investments in associates 28 119 1,047 1,038 Current assetsInventories 2,645 3,153Trade and other receivables 2,588 2,774Current tax - 35Deferred tax 49 35Cash and cash equivalents 1,275 822 6,557 6,819LiabilitiesCurrent liabilitiesTrade and other payables (1,399) (1,678)Borrowings (174) (406)Current tax (275) (260) (1,848) (2,344) Net current assets 4,709 4,475 Non-current liabilitiesBorrowings - (4)Retirement benefit liability (139) (94)Deferred consideration (104) (104) (243) (202) 5,513 5,311 Shareholders' equityShare capital 3 416 416Share premium account 3 1,531 1,531Capital redemption reserve 3 1 1Retained earnings 3 3,431 3,285Cumulative translation adjustment 3 37 (84) Equity attributable to the equity shareholders 5,416 5,149 Minority interests in equity 3 97 162 5,513 5,311 Consolidated cash flow statementfor the year ended 30 November 2007 2007 2006 £'000 £'000 Cash flows from operating activitiesOperating profit 1,202 1,001Share-based payment charge 12 8Depreciation 288 208Reduction in impairment re associate - (35)Currency translation 102 (79)Loss on sale of property, plant and equipment 1 1(Increase)/decrease in inventories 508 (529)(Increase)/decrease in trade and other receivables 231 (29)(Increase)/decrease in trade and other payables (362) 76 Cash generated from operations 1,982 622Corporation tax (paid)/refunded (418) (96) Net cash generated from operations 1,564 526 Cash flows from investing activitiesProceeds from disposal of investment in associate 119 -Increase in investment in existing subsidiary - (54)Investment in new subsidiary - -Investment in joint venture - -Purchase of property, plant and equipment (403) (244)Proceeds from sale of property, plant and equipment 15 29Income from investments - -Interest received 27 9 Net cash generated/(used) in investing activities (242) (260) Cash flows from financing activitiesProceeds from issue of shares - 8Purchase of treasury shares (398) -Interest paid (23) (26)Equity dividends paid (212) (197)Finance lease principal payments (6) (16) Net cash used in financing activities (639) (231) Net change in cash and cash equivalents 683 35Cash and cash equivalents at start of period 418 383 Cash and cash equivalents at end of period 1,101 418 Notes 1. Basis of preparation The group financial statements have been prepared in accordance with EU endorsedInternational Financial Reporting Standards (IFRS), International FinancialReporting Interpretations Committee (IFRIC) interpretations and with those partsof the Companies Act 1985 applicable to companies reporting under IFRS. Allaccounting standards and interpretations issued by the International AccountingStandards Board and the International Financial Reporting InterpretationsCommittee effective at the time of preparing these financial statements havebeen applied. 2. Taxation 2007 2006 £'000 £'000Analysis of the charge in the period Current tax- Current period 381 367- Adjustments in respect of prior periods 87 46 468 413Deferred tax (14) (23) Total tax 454 390 Tax reconciliation The tax for the period is higher (2006: higher) than the standard rate of corporation tax in theUK (30%). The differences are explained below: 2007 2006 £'000 £'000 Profit before taxation 1,206 959 Profit before taxation multiplied by rate of corporation tax inthe UK of 30% (2006: 30%) 362 288 Effects of:Differences between capital allowances and depreciation (10) (12)Amounts not deductible for taxation purposes - 70Adjustments in respect of prior years 87 46Taxation losses 15 13Different overseas tax rates - (15) Taxation 454 390 3. Statement of changes in shareholders' equity Group Capital Cumulative Share Share redemption translation Retained Shareholders' Minority Total capital premium reserve adjustment earnings Equity interest equity £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Balance at 1 December 414 1,525 1 - 2,883 4,823 247 5,0702005Profit/(loss) for the - - - - 591 591 (22) 569periodDividends - - - - (197) (197) - (197)Currency translation - - - (84) - (84) (31) (115)differencesShares issued during the 2 6 - - - 8 - 8periodShare-based payment - - - - 8 8 - 8creditMinority interest - - - - - - (49) (49)acquiredInvestments by minority - - - - - - 17 17interestBalance at 30 November 416 1,531 1 (84) 3,285 5,149 162 5,3112006Profit/(loss) for the - - - - 744 744 8 752periodDividends - - - - (212) (212) - (212)Purchase of treasury - - - - (398) (398) - (398)sharesCurrency translation - - - 121 - 121 (8) 113differencesShare-based payment - - - - 12 12 - 12creditTransfer in respect of - - - - - - (49) (49)associatesBalance at 30 November 416 1,531 1 37 3,431 5,416 113 5,5292007 4. The directors have recommended a final dividend of 3.25p (2006: 3.00p)per share payable on 20 May 2008 to shareholders on the register at close ofbusiness on 25 April 2008. The total dividend for the year, including theinterim dividend of 2.1p (2006: 2.0p) per share paid on 18 September 2007,amounts to £215,000 (2006: £208,000), which is equivalent to 5.35p (2006: 5.00p)per share. 5. The basic earnings per share are based on the profit for the financialyear of £744,000 (2006: £591,000) and on ordinary shares 4,140,085 (2006:4,149,236), the weighted average number of shares in issue during the year.Diluted earnings per share are based on 4,183,680 ordinary shares (2006:4,149,236), being the weighted average number of ordinary shares after anadjustment of 43,595 shares (2006: nil) in relation to share options. 6. This preliminary statement which has been approved by the Board on 18February 2008 is not the Company's statutory accounts. The statutory accountsfor each of the two years to 30 November 2006 and 30 November 2007 receivedaudit reports, which were unqualified and did not contain statements undersection 237 (2) or (3) of the Companies Act 1985. The 2006 accounts have beenfiled with the Registrar of Companies but the 2007 accounts are not yet filed. ENDS For further information, contact: Mr Rudi Weinreich, Chairman and Chief Executive, Holders Technology plc,on 020 8731 4336 Mr Jim Shawyer, Group Finance Director, Holders Technology plc,On 020 8731 4336 Mr John Wakefield, Director, Corporate Finance, Blue Oar Securities Plc,on 0117 933 0020. Website www.holderstechnology.com This information is provided by RNS The company news service from the London Stock Exchange