Kazera Global Regulatory News (KZG)

17 Jan 2007 07:01

Worthington Nicholls Group plc17 January 2007 RNS Release 17 January 2007 Worthington Nicholls Group plc Preliminary Results for the year ended 30 September 2006 and Pipeline 2007 Worthington Nicholls Group plc ("Worthington Nicholls" or "Group"), one of theUK's leading installers of air conditioning, heating, ventilation and chilledwater systems, announces preliminary results for the period ended 30 September2006. Financial and business highlights •Pro forma annualised turnover of £25 million •Pro forma annualised operating profit of £3.67 million •Dividend of 0.4 pence per ordinary share to be paid on 30 March 2007 •Admitted to AIM in June 2006, raising £7.5 million of new capital and £ 12.5 million of replacement capital from institutional and other investors •In December 2006, completed a further placing raising £6 million of new capital towards identified acquisitions •Acquired Project Air Limited and Lumenglow Limited •Pipeline of new business for 2007 currently at £28.5 million with live tenders for £67 million worth of additional business Peter Worthington, Chairman of Worthington Nicholls, said: "With the monies raised in the share placings, we now have in place thefinancial resources to make further acquisitions. Indeed, we are currentlylooking closely at a number of identified targets. Our focus is on companies operating in our main hotel market sector but we will also look to reduceshareholder risk through diversification into additional sectors, as wedemonstrated with the acquisition of Project Air Limited, which strengthened ourpenetration in the retail sector. "Working in Europe is also likely to be increasingly strategically important tothe Group as we expand. Having already secured our first European contract wewill look to take advantage of further opportunities as they arise. We look forward to 2007 with confidence and great excitement, and believe it will be ayear in which we make further strong progress." Enquiries, please contact: Worthington Nicholls 0870 609 1829Mark Worthington, Chief ExecutiveDavid Levis, Corporate Director Gresham PR Ltd 020 7404 9000Neil Boom / Laura Black Corporate Synergy 020 7448 4400Rhod Cruwys / Romil Patel Chairman's statement We are delighted to present our first set of financial results since our shareswere admitted to AIM. Worthington Nicholls has enjoyed a highly successful yearin which the Group has continued to make considerable progress. On a personal note, I would like to take this opportunity to welcome on boardour new shareholders, and of course, to thank all our staff for their continuedhard work and dedication. Results for the year ended 30 September 2006 Worthington Nicholls Group plc was incorporated on 3 February 2006 and commencedtrading on 6 June 2006, following its admission to trading on AIM. As requiredby the Companies Act legislation, the Group has prepared consolidated financialinformation for the period from incorporation to 30 September 2006. Thesestatutory numbers are set out at the end of this announcement. Trading for thisperiod generated turnover of £8 million million and earnings before interest andtax of £1.4 million. The board of directors of the Group ("the Board") considers, however, that thestatutory numbers do not provide shareholders with the most meaningful financialinformation to enable them to assess properly the performance of the Group. TheBoard has, therefore, prepared unaudited pro forma financial information for the12 months ended 30 September 2006. This information is prepared on the basisthat all companies within the Group were part of the Group for the full 12 monthperiod commencing on 1 October 2005 and contributed to the performance of theGroup for the full year to 30 September 2006, except for Project Air Limited,whose figures are included from the date of acquisition in June 2006. The pro forma financial results for the 12 months ended 30 September 2006 showthat the Group delivered growth in line with market expectations. Group turnoverwas £25 million, pro forma annualised gross profit was £7.2 million and earningsbefore interest and tax was £3.7 million. The Board is also very pleased to announce that as a result of the profitsachieved above, it is proposing to pay a dividend of 0.4p per share which willbe made on 30 March 2007 to shareholders on the register at the close ofbusiness on 2 March 2007. The Annual General Meeting of Worthington Nicholls will be held at the officesof Halliwells LLP, St. James's Court, Brown Street, Manchester on 23 March 2007at 10.00 a.m. Pipeline Our pipeline is looking extremely promising and is due mainly to repeat businesswith existing customers, and a healthy flow of new tenders generated by thefull-time Group sales team introduced over the past six months. The new contract wins announced in December 2006 are testament to the salesteam's success and we are excited about the level of tenders now being receivedand our increased conversion rate. Currently, our 2007 new business pipelineshows that we have already converted £28.5 million of orders into contractedrevenues with live tenders for £67 million worth of additional new business. Fund raising and acquisitions In conjunction with admitting our shares to trading on AIM in June, we were ableto raise £7.5 million from institutional and other shareholders. This capitalhas helped to fund acquisitions and facilitated organic expansion through theprovision of working capital, which is necessary to any company seeking to growquickly. Later in the year, the Group raised an additional £6 million to take advantageof a number of clearly identified acquisition opportunities which would deepenour presence in the hotel and retail markets. As shareholders are aware, since flotation, we have announced the acquisition oftwo companies, Project Air Limited and Lumenglow Limited, and anticipate beingin the position to complete further acquisitions in 2007. Project Air Limited In June, shortly after joining AIM, we were pleased to announce the completionof our first acquisition through the £4.6 million purchase of the entire issuedshare capital of Project Air Limited, a strongly profitable specialist installerof air conditioning systems to the retail sector. Project Air's customers include well-known high street retailers, includingPhones 4 U, Hamleys, The Bear Factory and TM Lewin. We are expecting to deliverfurther growth through Project Air's customers and resource base in addition toenhancing both turnover and profitability. Lumenglow Limited In December, the Group made its second acquisition, purchasing the entire issuedshare capital of Lumenglow Limited ("Lumenglow"), a specialist electricalcontractor. Whilst this was a smaller acquisition than the first, it was no less significant. As a supplier to the Group since 2003, we were very familiarwith the quality of service delivered by Lumenglow's skilled electricians. Inaddition to acquiring experienced electricians who have Joint Industry Board for the Electrical Contracting Industry accreditation, it is anticipated that wewill enhance Group profits in the current year by substantially reducing ouroutlay on electrical subcontracting. Before acquiring Lumenglow, the Group hadsubcontracted around £3 million of electrical work to suppliers other thanLumenglow. Acquiring Lumenglow gives us a significant opportunity to bringthese works in-house, thus enhancing profitability. The Lumenglow acquisition is also important strategically, bolstering theGroup's presence in London and the South East.Contract Wins During December we were delighted to announce five new hotel group contractsworth in the region of £2.3 million. The contracts were for the provision ofinstallation and maintenance of new and replacement air conditioning systemswith five new hotel group clients and was in line with the Group budget for newbusiness in the hotel sector in 2007. With each new hotel or retail groupclient, Worthington Nicholls aims to secure preferred supplier status,guaranteeing additional contracts through the provision of excellent service,with a strong focus on each customer's particular requirements. Our largest contract, was the full mechanical services installation at the 49bedroom Hotel du Vin in Cheltenham, and was valued at £860,000. Earlier this month we announced our first European contract win when we secureda contract to install new and replacement air conditioning systems with GrandCity Hotels & Resorts at the Park Hotel in Amsterdam, worth approximately€350,000. Grand City Hotels & Resorts is a management company of hotels in The Netherlandsand Germany, based in Berlin. The hotels managed by the group operate undervarious brands including Steigenberger, Ramada, Intercity Hotels, Comfort Inn,Quality Hotels, Mercure, Best Western and Ibis. The Grand City Hotels & Resorts estate has approximately 3,000 bedrooms inGermany. Having won the mandate for the Park Hotel in Amsterdam, the Group isconfident that this will pave the way for further expansion into Western Europe. Following these new contracts, Worthington Nicholls is now the retainedcontractor to 16 hotel groups and 16 retail chains. Board Appointment We have strengthened our Board with the appointment of Mr Tim Hunt as FinanceDirector from his previous position as non-executive director of the Group. Timjoined us from The John David Group plc and before that worked for major accountancy group KPMG. He has assumed responsibility for all financial aspectsof the Group moving forward. We look forward to benefiting from Tim'sexperience, particularly in acquiring companies and in financial systems'integration. Future Prospects The Board is confident that the Group will continue to benefit from strongdemand driven by environmental legislation and from an increased requirementfor comfort cooling in hotels, retail outlets and offices. We have already benefited from being in a market sector that is enjoying growthdriven by European legislation banning the use of less environmentally friendlyR22 refrigerant gases by the end of the decade. Removing R22 usually requires the replacement of entire air conditioning systems, a major exercise forhoteliers and retailers and one where they could naturally look to WorthingtonNicholls for support. Once replaced, the new air conditioning systems require regular maintenance. Weare pleased to report that recurring revenue streams from maintenance contractsstill account for a significant proportion of annual revenue and our aim is tocontinue to grow this side of our business. Clearly the boost to trade providedby R22 is a great opportunity and we are gearing up to take full advantage ofit through organic expansion and by making further acquisitions. With the monies raised in the share placings, we now have in place the financialresources to make further acquisitions. Indeed, we are currently lookingclosely at a number of identified targets. Our focus is companies operating inour main hotel market sector but we will also look to reduce shareholder riskthrough diversification into sub sectors, as we demonstrated with theacquisition of Project Air, which strengthened our presence in the retail sector. Working in Europe is also likely to be increasingly of strategic importance tothe Group as we expand. Having already secured our first European contract wewill look to take advantage of further opportunities as they arise. We look forward to 2007 with great confidence, and expect it to be a year in which wemake further strong progress. Peter WorthingtonGroup Chairman17 January 2007 Worthington Nicholls Group plc Preliminary Financial Statement 30 September 2006 Pro Forma Profit and Loss Account Year ended 30 September 2006 £'000s Turnover 24,841Cost of sales (17,543) _______Gross profit 7,298 Administrative expenses - normal (3,619)Administrative expenses - exceptional (1,498)Other operating income - Operating profitBefore exceptional items 3,679Exceptional item (note 1) (1,498) _______Operating profit 2,181 Other interest receivable and similar income 10Interest payable and similar charges (233) _______Profit on ordinary activities before taxation 1,958Taxation on profit on ordinary activities (363) _______Retained profit 1,595 _______ Notes 1. The exceptional item above of £1,498,000 relates to £1,112,000 for tax payable on the gifting of shares to employees during the year and £386,000 for directors bonuses pre-reorganisation. Worthington Nicholls Group plc Preliminary Financial Statement 30 September 2006 Consolidated Balance Sheet 30 September 2006 £'000sFixed assetsIntangible assets 28,713Tangible assets 1,770 _______ 30,483 _______Current assetsStocks 581Debtors and prepayments 10,235Cash at bank and in hand 519 _______ 11,335Creditors: amounts falling due within one year (7,316) _______Net current assets 4,019 _______Total assets less current liabilities 34,502Creditors: amounts falling due after more than one year (1,462) _______Net assets 33,040 _______Capital and reservesCalled up share capital 662Share premium account 30,802Merger reserve 588Profit and loss account 988 _______Equity shareholders' funds 33,040 _______ Worthington Nicholls Group plc Preliminary Financial Statement 30 September 2006 Pro Forma Cash Flow Statement Year ended 30 September 2006 £'000s Net cash outflow from operating activities (2,706) Returns on investments and servicing of financeInterest received 11Interest paid (209)Interest element of hire purchase contracts (24) _______ (222) _______Taxation - _______Capital expenditure and financial investmentPurchase of tangible fixed assets (88)Proceeds on disposal of tangible fixed assets 2 _______ (86) _______AcquisitionsCash consideration (net of cash balancesacquired) (3,273) _______ _______Net cash outflow before management of liquidresources and financing (6,287) _______FinancingRepayment of loans and borrowings (16)Proceeds from issue of equity shares (net ofexpenses) 7,052Capital element of hire purchase repayments (29) _______ 7,007 _______Increase in cash in the period 720 _______ Worthington Nicholls Group plc Preliminary Financial Statement 30 September 2006 Pro Forma Analysis of Net Debt 01 October Cash flow Acquisitions Year ended £000's (excluding cash and other changes) 2005 £'000s 30 September £000's 2006 £'000s Cash at bankand in hand 50 8 461 519Overdraft (1,218) 251 - (967) (1,168) 259 461 (448)Debt duewithin oneyear (35) 16 - (19)Debt due afterone year (1,402) - - (1,402)Obligationsunder hirepurchasecontracts (118) 29 (15) (104) Net debt (2,723) 304 446 (1,973) The following information is the audited financial results for Worthington Nicholls Group plc for the period from incorporation to 30 September 2006: STATUTORY ACCOUNTS FROM 3 FEBRUARY TO 30 SEPTEMBER 2006 Worthington Nicholls Group plc Preliminary Financial Statement 30 September 2006 Consolidated Profit and Loss Account Note 03 February 2006 to 30 September 2006 £'000s Turnover 7,997Cost of sales (5,375) _______Gross profit 2,622 Administrative expenses (1,275)Other operating income 16 _______Operating profit 1,413 Other interest receivable and similar income 10Interest payable and similar charges (76) _______Profit on ordinary activities before taxation 1,347Taxation on profit on ordinary activities (359) _______Retained profit 988 _______ Earnings per ordinary share:- Basic 1 3.23p- Diluted 3.14p Turnover and operating profit derive wholly from operations acquired during theperiod. The Group has no recognised gains or losses other than the results reportedabove. The results above also represent the historic cost profit. Worthington Nicholls Group plc Preliminary Financial Statement 30 September 2006 Consolidated Balance Sheet 30 September 2006 £'000sFixed assetsIntangible assets 28,713Tangible assets 1,770 _______ 30,483 _______Current assetsStocks 581Debtors and prepayments 10,235Cash at bank and in hand 519 _______ 11,335Creditors: amounts falling due within one year (7,316) _______Net current assets 4,019 _______Total assets less current liabilities 34,502Creditors: amounts falling due after more than one year (1,462) _______Net assets 33,040 _______Capital and reservesCalled up share capital 662Share premium account 30,802Merger reserve 588Profit and loss account 988 _______Equity shareholders' funds 33,040 _______ RECONCILIATION OF MOVEMENTS IN EQUITY SHAREHOLDERS' FUNDSAs at 30 September 2006 30 September 2006 £'000s Retained profit for the period 988New share capital subscribed 32,052 _______Net movement in equity shareholders' funds 33,040Opening equity shareholders' funds - _______Closing equity shareholders' funds 33,040 _______ Worthington Nicholls Group plc Preliminary Financial Statement 30 September 2006 Consolidated Cash Flow Statement 03 February 2006 to 30 September 2006 £'000s Net cash outflow from operating activities (2,457) Returns on investments and servicing of financeInterest received 10Interest paid (55)Interest element of hire purchase contracts (6) _______ (51) _______Taxation - _______Capital expenditure and financial investmentPurchase of tangible fixed assets (10) _______ (10) _______AcquisitionsCash consideration (net of cash balancesacquired) (16,259) _______ _______Net cash outflow before management of liquidresources and financing (18,777) _______FinancingRepayment of loans and borrowings (12)Proceeds from issue of equity shares (net ofexpenses) 18,352Capital element of hire purchase repayments (11) _______ 18,329 _______Decrease in cash in the period (448) _______ RECONCILIATION OF OPERATING PROFIT TO NET CASH INFLOW FROM OPERATING ACTIVITIESfor the period ended 30 September 2006 03 February 2006 to 30 September 2006 £'000s Operating profit 1,413Depreciation 27Decrease in stocks 303Increase in debtors (3,355)Decrease in creditors (845) Net cash outflow from operating activities (2,457) RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBTfor the period ended 30 September 2006 03 February 2006 to 30 September 2006 £'000s Decrease in cash in the period (448)Cash flow from decrease in debt and lease 23financingNew hire purchase agreements (15)Hire purchase agreements, loans and loannote (1,533)acquired with subsidiary undertakings Increase in net debt in the period (1,973)Net debt at start of period - Net debt at end of period (1,973) Worthington Nicholls Group plc Preliminary Financial Statement 30 September 2006 Analysis of Net Debt 03 February Cash flow Acquisitions 30 September £'000s (excluding cash and other changes) 2006 £'000s 2006 £'000s £'000s Cash at bankand in hand - 519 - 519Overdraft - (967) - (967) - (448) - (448)Debt duewithin oneyear - 12 (31) (19)Debt due afterone year - - (1,402) (1,402)Obligationsunder hirepurchasecontracts - 11 (115) (104) Net debt - (425) (1,548) (1,973) NOTES TO THE FINANCIAL STATEMENTS 1 Earnings per ordinary share Basic earnings per ordinary share represents the profit for the period of£988,000 divided by the weighted average number of ordinary shares in issue of30,548,045. The diluted earnings per ordinary share is based on 31,450,900 ordinary shares,the difference to the basic calculation representing the additional shares thatwould be issued on the conversion of all the dilutive potential ordinary shares.There is no material difference to earnings if all the dilutive potentialordinary shares are converted. 2 Accounts These figures are abridged versions of the Group's full accounts for the periodended 30 September 2006 and do not constitute the Group's statutory accountswithin the meaning of Section 240 of the Companies Act 1985. The Group'sauditors have audited the statutory accounts for the Group and have issued anunqualified audit opinion thereon within the meaning of Section 235 of theCompanies Act 1985 and have not made any statement under Section 237 (2) or (3)of the Companies Act 1985 for the period ended 30 September 2006. Statutoryaccounts for the period ended 30 September 2006 will be delivered to theRegistrar of Companies following the Annual General Meeting. Copies of the full accounts will be sent to shareholders in due course.Additional copies will be available from Worthington Nicholls Group Plc, GroundFloor, Barons Court, Manchester Road, Wilmslow, Cheshire SK9 1BQ. This information is provided by RNS The company news service from the London Stock Exchange