Last checked at 23 Jun 2011 07:00
James Latham plc
("James Latham", the "Company")
Full Year Results
In what has been another difficult year for the economy as a whole, I am pleased to report very positive results for the financial year to 31 March 2011 which show a good trading performance and a strong balance sheet.
Group revenue for the financial year to 31 March 2011 was £130,151,000, 12.8% up on last year's £115,372,000.
Operating profit has increased by 25.4% to £8,070,000 from £6,437,000 last year.
Finance income was £106,000 against £43,000 last year. Financial costs, which are principally interest on the pension scheme deficit as calculated under IAS19, were £532,000 against £893,000 last year. There was an additional receipt of £360,000 from the contract for the sale of the Clapton site in 2004/2005 due to additional development.
Pre-tax profit was £8,004,000 a significant increase of 43.3% on last year's figure of £5,587,000.
Profit after tax was £5,884,000 compared to £4,113,000 last year.
Earnings per share was 30.8p compared to last year's 21.5p.
Net assets (total equity) are £45,816,000.
At the year end the company's cash reserves stood at £7,113,000 compared to £10,545,000 at 31 March 2010. The balance was reduced by £4,000,000 as a result of working capital injected into DLH UK Limited, the hardwood trading business, in March 2011.
Final dividend
The directors recommend a final dividend of 6.25p per ordinary share (2010 5.25p). The final dividend will be paid on 26 August 2011 to shareholders on the register at the close of business on 5 August 2011. The shares will become ex-dividend on 3 August 2011.
The total dividend per ordinary share of 9.25p for the year is covered 3.3 times by earnings.
Financial year 2010/11
The Group's results are based on the trading of Lathams Limited, a specialist panel and timber distributor. Revenue was 12.8% higher than the previous year but maintaining a similar gross margin per cent.
The international market for hardwood and panel products was more stable than last year. Hardwood prices remained steady. Panel prices continued to strengthen from the low levels seen during the winter 2008-09, particularly during the first six months of this year. MDF based panels, a major element of panel sales, saw prices rise due to an increase in the cost and availability of raw materials, rather than rising demand.
On the whole turnover during the winter months held up well considering the adverse weather experienced in most parts of the country.
Overheads have risen noticeably as a result of higher fuel costs and additional sales staff that have been employed in areas where we are seeking to grow the business.
Bad debts were slightly higher than last year but the deterioration that we had anticipated over the Christmas period as a result of seasonal cash flow pressures did not materialise.
The defined benefit pension scheme triennial actuarial valuation based on 31 March 2011 is under way and this will determine future funding levels.
Current financial year 2011/12
The increasing level of demand and growing volumes seen in the first half of last year slowed in the second half. This year volumes are generally similar to 2010-11 but competition remains intense and higher cost prices threaten to erode margins. There are regional differences in demand and order books are generally short term. Balancing the desire to increase volumes and the need to manage customer credit levels continues to be a difficult equation.
Development strategy
The Directors have added resources to areas where they have identified opportunities for growth, such as hardwood flooring, door blanks and decorative panels. DLH UK Limited has been successfully integrated into the company. It will trade separately as LDT (Latham Direct Timber) principally in African and South East Asia hardwood and decking and will increase sales opportunities. Investment planned at Hemel Hempstead and Thurrock will help the company grow business in door blanks and decorative panels. Over the coming years it will be necessary to invest in our older sites to mirror the success which the investment in new facilities has delivered elsewhere. There are plans in the current year to relocate the company's largest business in Ossett, near Leeds to another site in the same area and this will have a short-term impact on profitability of that depot during the transition.
The company is in a strong financial position to take advantage of opportunities to continue growing the business.
Peter Latham
Chairman
23 June 2011
For further enquiries please visit www.lathams.co.uk or contact:
James Latham Plc | |
Peter Latham, Chairman | Tel: 01442 849 100 |
David Dunmow, Finance Director | Tel: 01442 849 100 |
Northland Capital Partners Ltd | |
Shane Gallwey | Tel: 020 7796 8800 |
For the year to 31 March 2011
Unaudited | Audited | |
Year to 31 March 2011 | Year to 31 March 2010 | |
£000 | £000 | |
Revenue | 130,151 | 115,372 |
Cost of sales (including warehouse costs) | (106,422) | (94,838) |
| Gross profit | 23,729 | 20,534 |
Selling and distribution costs | (10,405) | (9,435) |
| Administrative expenses | (5,346) | (4,749) |
Other operating income | 92 | 87 |
(15,659) | (14,097) | |
| Operating Profit | 8,070 | 6,437 |
Profit on disposal of property, plant and equipment | 360 | - |
Finance income | 106 | 43 |
Finance costs | (532) | (893) |
Profit before tax | 8,004 | 5,587 |
Tax expense | (2,120) | (1,474) |
Profit after tax attributable to owners of the parent company | 5,884 | 4,113 |
Earnings per ordinary share (basic) | 30.8p | 21.5p |
Earnings per ordinary share (diluted) | 30.5p | 21.4p |
All results relate to continuing operations
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year to 31 March 2011Unaudited | Audited | ||
| Year to 31 March 2011 | Year to 31 March 2010 | ||
£000 | £000 | ||
Profit after tax | 5,884 | 4,113 | |
Other comprehensive income | |||
Actuarial losses on defined benefit pension scheme | (719) | (3,387) | |
Deferred tax relating to components of other comprehensive income |
139 |
943 | |
Other comprehensive income for the year, net of tax | (580) | (2,444) | |
Total comprehensive income attributable to owners of the parent company |
5,304 |
1,669 | |
CONSOLIDATED BALANCE SHEET
At 31 March 2011
Unaudited | Audited | ||
As at 31 March 2011 | As at 31 March 2010 | ||
| £000 | £000 | |
Assets | |||
Non-current assets | |||
Goodwill | 237 | 237 | |
Other intangible assets | 131 | 138 | |
Property, plant and equipment | 18,536 | 18,359 | |
| Total non-current assets | 18,904 | 18,734 | |
| |||
Current assets | |||
Inventories | 24,771 | 19,210 | |
Trade and other receivables | 28,525 | 23,658 | |
Cash and cash equivalents | 7,113 | 10,545 | |
| Total current assets | 60,409 | 53,413 | |
Total assets | 79,313 | 72,147 | |
|
|
| |
Current liabilities | |||
Trade and other payables | 20,316 | 16,934 | |
Interest bearing loans and borrowings | 11 | 21 | |
Tax payable | 1,090 | 878 | |
Total current liabilities | 21,417 | 17,833 | |
Non-current liabilities | |||
Interest bearing loans and borrowings | 987 | 998 | |
Retirement and other benefit obligation | 8,561 | 8,311 | |
Other payables | 705 | 855 | |
Deferred tax liabilities | 1,827 | 1,915 | |
Total non-current liabilities | 12,080 | 12,079 | |
Total liabilities | 33,497 | 29,912 | |
| Net assets | 45,816 | 42,235 | |
Capital and reserves | |||
Issued capital | 5,040 | 5,040 | |
| Share-based payment reserve | 79 | 30 | |
Own shares | (401) | (203) | |
| Capital reserve | 3 | 3 | |
Retained earnings | 41,095 | 37,365 | |
| Total equity attributable to owners of the parent company | 45,816 | 42,235 | |
JAMES LATHAM PLCCONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Issued capital | Share-based payment reserve |
Own shares |
Capital reserve |
Retained earnings |
Total equity | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
At 1 April 2009 | 5,040 | 1 | (139) | 3 | 36,986 | 41,891 |
Profit for the year | - | - | - | - | 4,113 | 4,113 |
| Other comprehensive income: | ||||||
Actuarial loss on defined benefit pension scheme | - | - | - | - | (3,387) | (3,387) |
Deferred tax relating to components of other comprehensive income | - | - | - | - | 943 | 943 |
Total comprehensive income for the year | - | - | - | - | 1,669 | 1,669 |
| Transactions with owners: | ||||||
Dividends | - | - | - | - | (1,290) | (1,290) |
Change in investment in ESOP shares | - | - | (64) | - | - | (64) |
Share-based payment expense | - | 29 | - | - | - | 29 |
Total transactions with owners | - | 29 | (64) | - | (1,290) | (1,325) |
| Balance at 31 March 2010 | 5,040 | 30 | (203) | 3 | 37,365 | 42,235 |
Profit for the year | - | - | - | - | 5,884 | 5,884 |
| Other comprehensive income: | ||||||
Actuarial loss on defined benefit pension scheme | - | - | - | - | (719) | (719) |
Deferred tax relating to components of other comprehensive income | - | - | - | - | 139 | 139 |
Total comprehensive income for the year | - | - | - | - | 5,304 | 5,304 |
| Transactions with owners: | ||||||
Dividends | - | - | - | - | (1,574) | (1,574) |
Change in investment in ESOP shares | - | - | (198) | - | - | (198) |
Share-based payment expense | - | 49 | - | - | - | 49 |
Total transactions with owners | - | 49 | (198) | - | (1,574) | (1,723) |
Balance at 31 March 2011 | 5,040 | 79 | (401) | 3 | 41,095 | 45,816 |
JAMES LATHAM PLC
CONSOLIDATED CASH FLOW STATEMENTFor the year to 31 March 2011Unaudited | Audited | |
Year to 31 March 2011 | Year to 31 March 2010 | |
£000 | £000 | |
Net cash flow from operating activities | ||
Cash generated from operations | 4,772 | 2,757 |
Interest paid | (9) | (5) |
Income tax paid | (1,857) | (943) |
Net cash inflow from operating activities | 2,906 | 1,809 |
Cash flows from investing activities | ||
Interest received and similar income | 111 | 39 |
Purchase of property, plant and equipment | (1,004) | (568) |
Purchase of intangible asset | (1) | - |
Proceeds from sale of property, plant and equipment | 2 | 2 |
Proceeds from prior year sale of property | 360 | - |
Net cash outflow from investing activities | (532) | (527) |
Cash flows from financing activities | ||
Finance leases repaid during the year | (21) | (22) |
Borrowings repaid during the year | (3,924) | - |
Equity dividends paid | (1,574) | (1,290) |
Preference dividend paid | (79) | (79) |
Purchase of own shares | (208) | (64) |
Net cash outflow from financing activities | (5,806) | (1,455) |
Decrease in cash and cash equivalents for the year | (3,432) | (173) |
Cash and cash equivalents at beginning of the year | 10,545 | 10,718 |
Cash and cash equivalents at end of the year | 7,113 | 10,545 |
JAMES LATHAM PLC Notes to the preliminary financial information
1. The results presented in this report are unaudited and they have been prepared in accordance with the recognition and measurement principles of International Financial Reporting Standards ('IFRS) as adopted by the EU set out in the Group accounts for the years ended 31 March 2010 and 31 March 2011. The figures for the year ended 31 March 2010 have been audited.
2. The directors propose a final dividend of 6.25p per ordinary share, which will absorb £1,189,000 (2010: 5.25p absorbing £1,003,000), payable on 26 August 2011 to shareholders on the Register at the close of business on 5 August 2011. The ex-dividend date is 3 August 2011.
3. The financial information in this announcement does not constitute statutory accounts as defined in section 435 of the Companies Act 2006 for the years ended 31 March 2011 or 2010. The statutory financial statements for the year ended 31 March 2011 will be finalised and signed on the basis of the financial information presented by the directors in this preliminary announcement and will be delivered to the Registrar of Companies following the Company's Annual General Meeting. The financial information for the year ended 31 March 2010 is derived from the statutory accounts for that year. The auditor reported on those statutory accounts which have been delivered to the Registrar of Companies and which did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.
4. This announcement was approved by the Board of Directors on 22 June 2011.
5. The Annual General Meeting of James Latham plc will be held at Unit 3 Swallow Park, Finway Road, Hemel Hempstead, Herts, HP2 7QU on 24 August 2011 at 12.30pm.
The Annual Report and Accounts for the year ended 31 March 2011 will be sent to all shareholders in due course. The Annual Report and Accounts may also be viewed in due course on James Latham plc's website at www.lathams.co.uk