Ironveld Regulatory News (IRON)

20 Sep 2007 07:00

Mercury Recycling Group PLC20 September 2007 MERCURY RECYCLING GROUP PLC INTERIM REPORT FOR THE PERIOD ENDING 30 JUNE 2007 CHAIRMAN'S STATEMENT I am pleased to report that the Group's unaudited results for the six monthsended 30 June 2007, show a further increase in sales compared to the same periodlast year to £1,304,000 from £1,219,000. Operating profits at the interimstage, excluding goodwill impairment and exceptional items increased to £233,000from £212,000. The operating profit for the whole of the last financial yearwas £336,000. As can be seen from the Balance Sheet, we have a strong liquidposition, with current assets at £901,000 including cash of £323,000. The WEEE Directive was eventually implemented on 1 July, so that all GasDischarge lamps must now be legally recycled. I said in my statement at theyear end, that there was confusion in Government Departments and the industrygenerally. Without that confusion, I am sure that sales and profits would havebeen much better. The position has now become clearer, although the compleximplementation of the Directive will take a little longer to settle down. Wehave however, had successful discussions with all the compliance schemes withinour sector, where we now have excellent relationships. It will of course take some time for all the estimated 130 million lamps to berecycled, given that only something below 25% are currently being recycled,there is obviously room for large increases, and I am confident we will at thevery least maintain our present major share of the lamp recycling market. Ishould repeat again that no capital expenditure will be required, as our newplant and premises have the capacity to substantially increase our recyclingoutput. I can report that new customers continue to come on board every month.In addition following the implementation of the WEEE directive, we are startingto receive from our large customer base, WEEE products other than lamps forrecycling. In order to ensure that the relevant authorities are in place to enable theBoard to issue shares, a notice convening an EGM has been prepared and is alsoenclosed with these results. I conclude by emphasising that the Board are confident following all I have saidabove, that future prospects look very good. The Rt Hon The Lord Barnett JP PCChairman20 September 2007 Enquiries: Simon Lebor, Group Chief Executive Tel: 0161 877 0977John Wakefield, Blue Oar Securities Plc Tel: 0117 933 0020 CONSOLIDATED INCOME STATEMENTFOR THE PERIOD ENDED 30 JUNE 2007 As restated 6 Months 6 Months Year ended ended ended 30.6.07 30.6.06 31.12.06 £'000 £'000 £'000 Revenue 1,304 1,219 2,399 Cost of sales (204) (104) (193) Gross profit 1,100 1,115 2,206 Administrative expenses (979) (1,034) (2,096) Operating profit before goodwill impairment, relocation costs and share based payment costs 233 212 336Relocation costs - (17) -Share-based payment expense (10) (12) (22)Goodwill impairment (102) (102) (204) Operating profit 121 81 110 Investment revenues 2 1 1Finance costs (13) (14) (27) Profit before taxation 110 68 84 Tax - - - Profit for the period 110 68 84 Earnings per share: Basic (pence) 0.33p 0.20p 0.25p Diluted (pence) 0.32p 0.19p 0.24p STATEMENT OF CHANGES IN EQUITY As restated 6 Months 6 Months Year ended ended ended 30.6.07 30.6.06 31.12.06 £'000 £'000 £'000Opening balance (and as restated forconversion to IFRS) 4,175 4,032 4,032 Profit for the financial period 110 68 84 New shares issued - - 37Share based payments 10 12 22 Closing balance 4,295 4,112 4,175 CONSOLIDATED BALANCE SHEETAS AT 30 JUNE 2007 As restated As at As at As at 30.6.07 30.6.06 31.12.06 £'000 £'000 £'000Non-current assetsGoodwill 2,919 3,124 3,021Other intangible assets 2 3 2Property, plant and equipment 1,109 1,139 1,140 4,030 4,266 4,163Current assetsTrade and other receivables 578 493 533Cash and cash equivalents 323 29 135 901 522 668 Total assets 4,931 4,788 4,831 Current liabilitiesTrade and other payables (163) (172) (172)Current tax liabilities (108) (86) (93)Obligations under finance leases (17) (42) (21)Bank overdrafts and loans (25) (7) (26) (313) (307) (312) Non-current liabilitiesOther payables (70) (79) (73)Bank loans (248) (290) (259)Obligations under finance leases (5) - (12) (323) (369) (344) Total liabilities (636) (676) (656) Net assets 4,295 4,112 4,175 Capital and reservesShare capital 3,373 3,336 3,373Share premium 242 242 242Other reserve 283 448 365Retained earnings reserve 397 86 195 Equity shareholders' funds 4,295 4,112 4,175 CONSOLIDATED CASH FLOW STATEMENTFOR THE SIX MONTHS ENDED 30 JUNE 2007 As restated 6 Months 6 Months 6 Months ended ended ended 30.6.07 30.6.06 31.12.06 £'000 £'000 £'000 Net cash from operating activities 255 242 377 Investing activitiesInterest received 2 1 1Purchases of property, plant and equipment (47) (77) (96) Net cash used in investing activities (45) (76) (95) Financing activitiesProceeds on issue of shares - - 20Repayment of loans (12) (4) (15)Repayments of finance lease obligations (10) (5) (24) Net cash used in financing activities (22) (9) (19) Net increase in cash and cash equivalents 188 157 263 Cash and cash equivalents at the beginning ofyear 135 (128) (128) Cash and cash equivalents at end of year 323 29 135 Note to the cash flow statement Profit for the year 121 81 110Depreciation on plant and equipment 79 81 145Impairment of goodwill 102 102 204Decrease in provisions (5) (4) (9)Share-based payment expense 10 12 22Gain on disposal of plant property, plant andequipment - (4) (1) Operating cash flows before movements in 307 268 471working capitalDecrease / (increase) in receivables (45) 38 15(Decrease) / increase in payables 6 (50) (82) Cash generated by operations 268 256 404Interest paid (13) (14) (27) Net cash from operating activities 255 242 377 NOTES TO CONSOLIDATED ACCOUNTSFOR THE SIX MONTHS ENDED 30 JUNE 2007 1. Basis of preparation and accounting policies Basis of preparation As an AIM-listed company, the Group is required to adopt International FinancialReporting Standards (IFRS) with effect from 1 January 2007. The Group's date oftransition to IFRS was 1 January 2006. The results for the six months to 30 June 2007 represent the Group's firstinterim financial statements prepared in accordance with IFRS. The Group'sfirst annual report under IFRS will be for the year ended 31 December 2007. A reconciliation between comparative values under IFRS and as reported under UKGenerally Accepted Accounting Principles (UK GAAP) has been published previouslyand is available on the Group's website at www.mercuryrecycling.co.uk. Theinformation provided also includes details of accounting policies adopted by theGroup under IFRS, and the exceptions from retrospective application of IFRS thatthe Group has applied under IFRS 1 'First Time Adoption of InternationalFinancial Reporting Standards'. The financial information does not constitute statutory accounts as defined bysection 240 of the Companies Act 1985. Full accounts of the company for theyear ended 31 December 2006 on which the Auditors gave an unqualified report,have been delivered to the Registrar of Companies. 2. Earnings per share The calculation of basic and diluted earnings per share is based upon the profitfor the period and the weighted average number of shares in issue during theperiod. 6 Months 6 Months Year to to to 30.6.07 30.6.06 31.12.06 '000 '000 '000 Weighted average number of shares 33,726 33,359 33,543 Options - dilution 661 1,202 797 34,387 34,561 34,340 Adjusted earnings per share is calculated using earnings before impairment ofgoodwill. 6 Months 6 Months Year to to to 30.6.07 30.6.06 31.12.06 pence pence pence Basic earnings per share 0.33 0.20 0.25 Adjustment 0.33 0.40 0.67Adjusted basic earnings per share 0.66 0.60 0.92 3. Copies of report Copies of this interim statement will be despatched to shareholders and will beavailable to the public at the Registered Office, Mercury House, 17 CommerceWay, Trafford Park, Manchester, M17 1HW. 4. Reconciliation of balance sheet 1 January 2007 for the impact of IFRS Items effected by change to IFRS UK GAAP Adjustment IFRS £'000 £'000 £'000Non-current assetsOther intangible assets - 2 2Property, plant and equipment 3,021 (2) 3,019 Current liabilitiesTrade and other payables (167) (5) (172) Non-current liabilitiesOther payables - (73) (73)Provisions (78) 78 - Capital and reservesMerger reserve (111) 111 -Retained earnings reserve 306 (111) 195 Full details of the transition to International Financial Reporting Standardsare given on the Group's website at www.mercuryrecycling.co.uk This information is provided by RNS The company news service from the London Stock Exchange