Latham Timber Regulatory News (LTHM)

29 Jun 2006 07:00

Latham(James) PLC29 June 2006 James Latham plc Announcement of Preliminary Results for the year ended 31 March 2006 and Chairman's Statement Chairman's Statement Results Group turnover for the financial year to 31 March 2006 at £114,867,000 is 6.1%ahead of last year's £108,240,000. Operating profit increased by 20.2% to £4,984,000 from £4,148,000 last year. Net interest receivable was £439,000 against net interest payable of £360,000last year. Including disposals, pre-tax profit is £11,644,000 against £21,594,000 lastyear. Excluding this year's profit on the disposal of a subsidiary and lastyear's profit on the disposal of fixed assets, the pre-tax profit is £5,423,000against £3,788,000, an increase of 43.2%. Profit after tax is £9,728,000 compared with £17,312,000 previously. Total net assets after the FRS17 pension liability (shareholders' funds) haverisen to £39,902,000 from £32,752,000. Cash flow from operating activities at £1,545,000 was after the initial paymentof £4 million of the £9 million to be paid into the pension scheme as announcedat the Interim. The presentation of the figures reflects the introduction of new AccountingStandards FRS17, FRS21 and FRS25 and the previous figures have been restated. Final dividend The directors recommend a final dividend of 4.4p per ordinary share (2005:3.7p). The final dividend will be paid on 21 August 2006 to shareholders on theregister at the close of business on 21 July 2006. The shares will becomeex-dividend on 19 July 2006. The total dividend per ordinary share (including the special dividend of 7.0ppaid in January 2006) of 13p for the year is covered 3.7 times by earnings.Excluding the special dividend and the profit on the sale of Nevill Long Ltd,the total of 6p for the year is covered 2.8 times by earnings of 17.1p. Thiscompares with a total dividend last year of 5.2p which was covered 2.8 times. Financial year 2005/06 The overall trading result for the Group shows an improvement on last year. Lathams Ltd, the panel products and timber distributor achieved a 3% increase inturnover but after a small decline in gross margin percentage the net profit waslower than last year. Globally the availability of timber products was morethan enough to satisfy demand with the resultant pressure on prices and margins.The third quarter at Lathams Ltd was poor but trading picked up again in thefourth quarter. Nevill Long Ltd, the ceiling, drylining and partitioning distributor, had anexcellent year. Prices of a number of the company's main product linesincreased substantially and remained at the higher level. Sales were 20% higherthan the previous year and, combined with an improved gross margin, resulted ina record profit of £1,990,000. Nevill Long's profits had been volatile in the past relying on a narrow customerrange and synergy with the rest of the James Latham Group was negligible. Theopportunity was taken to sell the company on 31 March 2006 realising a profit of£6,229,000. During the year and since the year end substantial additional contributions havebeen paid into the pension scheme and by this time next year the fundingsituation should be much more healthy. After the sales of the Clapton site and Nevill Long Ltd and with the pensionscheme better funded, James Latham plc is in a strong financial position. Thedirectors intend to develop Lathams Ltd's core business of timber productsdistribution as and when opportunities arise. Current financial year 2006/07 April and May taken together have achieved a satisfactory level of trading. Theindications are that June will follow suit. Availability and replacement prices are hardening for a number of the productswe sell. This normally has a beneficial affect on sales and margins. Roger LathamChairman28.06.06 JAMES LATHAM PLCCONSOLIDATED BALANCE SHEETAs at 31 March 2006 As at 31 March 2006 As at 31 March 2005 (as restated) £000 £000 Fixed assets Intangible fixed assets 362 740Tangible fixed assets 11,438 11,823 11,800 12,563Current assets Stocks - goods for resale 13,746 18,645Debtors: amounts falling due within one year 32,073 29,001Debtors: amounts falling due after more than one year 5,919 7,753Cash at bank and in hand 1,399 148 53,137 55,547Creditors: amounts falling due within one year (17,623) (21,628)Net current assets 35,514 33,919 Total assets less current liabilities 47,314 46,482 Creditors: amounts falling due after more than one year (2,208) (4,497) Provisions for liabilities and charges Deferred taxation - (62)Other provisions (277) (339)Net assets excluding pension liability 44,829 41,584 Net pension liability (4,927) (8,832)Total net assets 39,902 32,752 Represented by:Capital and reserves Called up share capital 5,040 5,040Less investment in own shares (244) (300)Capital reserve 3 3Revaluation reserve 758 758Profit and loss account 34,345 27,251Equity shareholders' funds 39,902 32,752 JAMES LATHAM PLCCONSOLIDATED PROFIT AND LOSS ACCOUNTFor the year ended 31 March 2006 Year to 31 March 2006 Year to 31 March 2005 (as restated) £000 £000Turnover Continuing operations 90,650 88,077Discontinuing operations 24,217 20,163 114,867 108,240Cost of sales (including warehouse costs) (94,937) (89,811)Gross profit 19,930 18,429 Selling and distribution costs (9,272) (8,322)Administrative expenses (5,876) (6,141)Other operating income 202 182 (14,946) (14,281)Operating profit Continuing operations 3,435 3,726Discontinued operations 1,549 422 4,984 4,148Profit on disposal of subsidiary 6,229 -(Loss) profit on disposal of fixed assets (8) 17,806Net interest receivable (payable) 439 (360)Profit on ordinary activities before taxation 11,644 21,594Tax on profit on ordinary activities (1,916) (4,282)Profit on ordinary activities after taxation 9,728 17,312 Dividends paid - ordinary (2,449) (2,426)Retained profit 7,279 14,886 Earnings per ordinary share (basic) 48.3p 85.7pEarnings per ordinary share (diluted) 48.3p 85.7p JAMES LATHAM PLCCONSOLIDATED CASH FLOW STATEMENTFor the year ended 31 March 2006 Year to 31 March 2006 Year to 31 March 2005 (as restated) £000 £000 Cash flow from operating activities 1,545 (336) Returns on investments and servicing of financeInterest received and similar income 1,488 493Interest paid (380) (311)Preference dividend paid (79) (79)Net cash inflow from returns on investments and 1,029 103servicing of financeTaxation (2,345) (2,020) Capital expenditure Purchase of tangible fixed assets (417) (1,235)Purchase of intangible fixed assets - (395)Proceeds of sale of tangible fixed assets and property 4,809 6,613Net cash flow from capital expenditure 4,392 4,983Equity dividends paid (2,449) (2,416) Cash outflow before financing 2,172 314Financing Bank loans repaid during the period (714) (714) Bank loans obtained during the year - 1,500 Finance leases repaid during the period (25) (26) Purchase of own shares (36) (312) Proceeds of sale of own shares 92 211 Net cash (outflow) inflow from financing (683) 659 Increase in cash for the year 1,489 973 Year to 31 March 2006 Year to 31 March 2005 (as restated) £000 £000 Increase in cash for the year 1,489 973 Finance leases acquired during the period - (66) Cash outflow (inflow) from decrease in debt and lease 683 (760)financing Movement in net debt for the year 2,172 147 Net debt at 1 April 2005 (restated) (5,059) (5,206) Net debt at 31 March 2006 (2,887) (5,059) JAMES LATHAM PLCCONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSESFor the year ended 31 March 2006 Year to 31 March 2006 Year to 31 March 2005 (as restated) £000 £000 Profit for the period 9,728 17,312 Actual return less expected return on pension scheme assets 3,950 439Experience gains and losses arising from pension scheme 1,028 75liabilitiesChanges in assumptions underlying the present value of (5,242) (676)pension scheme liabilitiesMovement in deferred tax relating to actuarial loss on 79 48pension schemeTotal recognised gains and losses relating to the period 9,543 17,198Prior year adjustment - FRS17 "Retirement benefits" (9,720) - Total gains and losses recognised since the last annual (177) 17,198report RECONCILIATION OF MOVEMENT IN SHAREHOLDERS' FUNDSFor the year ended 31 March 2006 Year to 31 March 2006 Year to 31 March 2005 (as restated) £000 £000Profit attributable to shareholders 9,728 17,312Dividends (2,449) (2,426) 7,279 14,886 Other recognised gains and losses relating to the period (185) (114) Change in investment in own shares 56 (95) Movement in the period 7,150 14,677 Opening shareholders' funds - as previously stated 42,723 27,927 Change in accounting policies: FRS17 - recognition of pension liability net of SSAP24 (9,720) (9,495)adjustment FRS21 - accounting for dividends on "paid" basis 736 630 FRS25 - reclassification of preference shares as a (987) (987)liability Opening shareholders' funds - restated 32,752 18,075 Closing shareholders' funds 39,902 32,752 JAMES LATHAM PLCNOTES TO THE FINANCIAL STATEMENT 1. The financial information in this announcement does not constitutestatutory accounts as defined in section 240 of the companies Act 1985.Statutory accounts for the previous financial year ended 31 March 2005 have beendelivered to the Registrar of Companies. The auditors' report on those accountswas unqualified and did not contain any statement under section 237(2) or (3) ofthe Companies Act 1985. The auditors have indicated that they intend to give anunqualified report, and will not contain any statement under section 237(2) or(3) of the Companies Act 1985, on the statutory accounts for the year ended 31March 2006. Copies of the Company's Report and Accounts will be sent toshareholders shortly and will be available at the registered office of thecompany, Unit 3, Swallow Park, Finway Road, Hemel Hempstead, Herts HP2 7QU, freeof charge and for at least one month following this announcement. 2. The consolidated accounts include the accounts of the Company and itssubsidiary undertakings and have been prepared using acquisition accountingprinciples. 3. The basic earnings per share are calculated on the weighted averagenumber of shares in issue during the year of 19,963,196 (2005: 20,107,660). Thefully diluted earnings per share takes account of the outstanding options whichresults in a weighted average number of shares in issue during the year of19,993,034 (2005: 20,107,660). 4. The directors recommend payment of a final dividend of 4.4p perordinary share (2005: 3.7p). 5. The taxation charge for the year looks low as a percentage of pre-taxprofit at 16.5% (2005: 19.8%). This is because the company has taken advantageof substantial shareholding exemption on the disposal of Nevill Long Limited,and no taxation will arise on the sale. 6. The accounts have been prepared using new accounting standards asdetailed below: a) FRS17 "Retirement benefits": This requires that the grouppension liability be recognised in the financial statements. b) FRS21 "Events after the balance sheet date": This requiresthat paid dividends are not accrued for in the accounts, but are recognised uponpayment. Final dividends at 31 March are therefore not included as liabilitiesin the balance sheet. c) FRS25 "Financial instruments": This requires thatpreference shares are disclosed as part of creditors: amounts falling due aftermore than one year, rather than as share capital. All comparative figures have been restated to reflect these standards. The effect of adopting these accounting standards have been as follows: Year to 31 March 2006 Year to 31 March 2005 (as restated)Profit and loss account £000 £000Profit before adoption of new accounting standards 5,092 14,891 Decrease in pension costs 4,745 551 Increase in interest payable (567) (710) Change in deferred taxation (1,253) 48 Accounting for dividends on a "declared" basis (738) 106 Restated profit after adoption of new accounting standards 7,279 14,886 Statement of total recognised gains and losses Recognition of change in pension liability during the (185) (114)period Recognition of pension fund liability at 1 April 2005 (10,100) -including SSAP24 adjustment Change in other gains and losses after adopting new (10,285) (114)accounting standards Balance sheet Net assets before adopting new standards 45,817 42,723 Recognition of pension liability, including SSAP24 (6,195) (10,100)adjustment Deferred tax on SSAP24 adjustment 380 380 Accounting for dividends on a "declared" basis 887 736 Preference shares disclosed as a liability (987) (987) Net assets as restated 39,902 32,752 7. Copies of this statement will be sent to all shareholders and will also beavailable on written applications to the Company Secretary, James Latham plc,Unit 3 Swallow Park, Finway Road, Hemel Hempstead, Herts, HP2 7QU. This information is provided by RNS The company news service from the London Stock Exchange