Last checked at 24 Nov 2011 07:00
James Latham plc
("James Latham" or the "Company")
HALF YEARLY RESULTS FOR THE PERIOD ENDED 30 SEPTEMBER 2011
Chairman's statement
I am pleased to report good results for the six months to 30 September 2011. This is in spite of trading conditions in our markets which have continued to be difficult and, as predicted, margins have come under pressure, resulting in profits similar to last year.
Results
Revenue for the six months to 30 September 2010 was £74,207,000 compared to £65,985,000 for the same period last year, representing a 12% increase. The operating profit was £4,382,000, down from £4,463,000 last year. Finance Income was £26,000 (2010: £33,000) and Finance Costs were £249,000 (2010: £265,000). Profit before tax was £4,159,000, down from last year's £4,591,000 which included a one off additional receipt of £360,000 from the sale of the Clapton site in 2004/05. Earnings per ordinary share were 16.1p (2010: 17.8p).
As at 30 September 2011 shareholder funds were £44.7m (30.9.2010: £42.6m) with cash and cash equivalents of £3.9m (2010: £7.8m).
Interim dividend
The Board has declared an interim dividend of 3.0p per Ordinary Share (2010: 3.0p), which is covered 5.4 times (2010: 5.9 times). The dividend is payable on 25 January 2012 to ordinary shareholders on the Company's Register at close of business on 6 January 2012. The ex-dividend date will be 4 January 2012.
Six months trading to 30 September 2011.
Group revenue has continued to increase on a like-for-like basis. This is the result of both higher prices and increased volumes. The growth in sales has been achieved in both timber and panel products. The recently purchased DLH UK Limited, now trading as LDT, a division of Lathams Limited, has produced results above our expectations.
Trading margins for the period July to September have come under pressure. Overheads have been well controlled, although staff numbers have been increased in areas where we see opportunities for growth. Record sales were achieved in August and September. Cash balances at the end of September were £3.9m. As already announced, we have purchased a new, bigger, site in Leeds. Work to fit out the unit is underway and the business will start transferring in December. We continue to take advantage of cash settlement discounts from suppliers where this represents a good return on our cash.
Pension scheme
The IAS19 valuation shows that the scheme deficit has increased to £12.5m from £8.6m in March. This is mainly because the reduction in AA grade bond yields has increased the present value of pension scheme liabilities. This measure is however very volatile. The triennial actuarial valuation based on 31 March 2011 showed a deficit of £9m compared to £5m in March 2008. The trustees and the company have agreed a recovery plan to pay off the deficit over ten years.
Current & future trading
The management accounts and information show steady revenue for October and the first half of November, but margins are still under pressure. Bad debts have been below last year's level but will remain a concern over the next few months. In this trading climate it is difficult to predict future trading patterns. Some customers still have full order books but there is less confidence than earlier in the year, however the directors still see opportunities to expand the business profitably.
Peter Latham
Chairman
24 November 2011
For further information please visit www.lathams.co.uk or contact:
James Latham Plc | Tel: 01442 849 100 |
Peter Latham, Chairman | |
David Dunmow, Finance Director | |
Northland Capital Partners - Nomad & Broker | Tel: 020 7796 8800 |
Shane Gallwey / Tim Metcalfe | |
JAMES LATHAM PLC | |||
CONSOLIDATED BALANCE SHEET | |||
At 30 September 2011 | |||
As at 30 Sept. 2011 unaudited | As at 30 Sept. 2010 unaudited | As at 31 March 2011 audited | |
£000 | £000 | £000 | |
ASSETS | |||
Non-current assets | |||
Goodwill | 237 | 237 | 237 |
Intangible assets | 127 | 135 | 131 |
Property, plant and equipment | 21,588 | 18,749 | 18,536 |
Total non-current assets | 21,952 | 19,121 | 18,904 |
Current assets | |||
Inventories | 25,399 | 22,432 | 24,771 |
Trade and other receivables | 32,212 | 29,003 | 28,525 |
Cash and cash equivalents | 3,881 | 7,757 | 7,113 |
Total current assets | 61,492 | 59,192 | 60,409 |
Total assets | 83,444 | 78,313 | 79,313 |
Current liabilities | |||
Trade and other payables | 20,094 | 21,156 | 20,316 |
Current portion of interest bearing loans and borrowings | 340 | 21 | 11 |
Current tax payable | 987 | 1,016 | 1,090 |
Total current liabilities | 21,421 | 22,193 | 21,417 |
Non-current liabilities | |||
Interest bearing loans and borrowings | 3,347 | 988 | 987 |
Retirement and other benefit obligation | 12,479 | 10,347 | 8,561 |
Other payables | 676 | 820 | 705 |
Deferred tax liabilities | 819 | 1,344 | 1,827 |
Total non-current liabilities | 17,321 | 13,499 | 12,080 |
Total liabilities | 38,742 | 35,692 | 33,497 |
Net assets | 44,702 | 42,621 | 45,816 |
Capital and reserves | |||
Issued capital | 5,040 | 5,040 | 5,040 |
Share-based payment reserve | 111 | 52 | 79 |
Own shares | (359) | (340) | (401) |
Capital reserve | 3 | 3 | 3 |
Retained earnings | 39,907 | 37,866 | 41,095 |
Total equity attributable to equity shareholders of the parent company | 44,702 | 42,621 | 45,816 |
JAMES LATHAM PLC | |||
CONSOLIDATED INCOME STATEMENT | |||
For the six months to 30 September 2011 | |||
Six months to 30 Sept. 2011 unaudited | Six months to 30 Sept. 2010 unaudited | Year to 31 March 2011 audited | |
£000 | £000 | £000 | |
Revenue | 74,207 | 65,985 | 130,151 |
Cost of sales (including warehouse costs) | (61,091) | (53,778) | (106,422) |
Gross profit | 13,116 | 12,207 | 23,729 |
Selling and distribution costs | (5,872) | (5,251) | (10,405) |
Administrative expenses | (2,892) | (2,539) | (5,346) |
Other operating income | 30 | 46 | 92 |
(8,734) | (7,744) | (15,659) | |
Operating profit | 4,382 | 4,463 | 8,070 |
Profit on disposal of property, plant and equipment | - | 360 | 360 |
Finance income | 26 | 33 | 106 |
Finance costs | (249) | (265) | (532) |
Profit before tax | 4,159 | 4,591 | 8,004 |
Tax expense | (1,086) | (1,189) | (2,120) |
Profit after tax attributable to owners of the parent company | 3,073 | 3,402 | 5,884 |
Earnings per ordinary share (basic) | 16.1p | 17.8p | 30.8p |
Earnings per ordinary share (diluted) | 15.9p | 17.7p | 30.5p |
All results relate to continuing operations. |
JAMES LATHAM PLC | |||
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | |||
For the six months to 30 September 2011 | |||
Six months to 30 Sept. 2011 unaudited | Six months to 30 Sept. 2010 unaudited | Year to 31 March 2011 audited | |
£000 | £000 | £000 | |
Profit after tax | 3,073 | 3,402 | 5,884 |
Other Comprehensive income | |||
Actuarial losses on defined benefit pension scheme | (4,171) | (2,638) | (719) |
Deferred tax relating to components of other comprehensive income | 1,081 | 739 | 139 |
Other comprehensive income for the period, net of tax | (3,090) | (1,899) | (580) |
Total comprehensive income, attributable to owners of the parent company | (17) | 1,503 | 5,304 |
JAMES LATHAM PLC | |||
CONSOLIDATED CASH FLOW STATEMENT | |||
For the six months to 30 September 2011 | |||
Six months to 30 Sept 2011 unaudited | Six months to 30 Sept 2010 unaudited | Year to 31 March 2011audited | |
£000 | £000 | £000 | |
Net cash flow from operating activities (note 5) | |||
Cash generated from operations | 150 | 37 | 4,772 |
Interest paid | (210) | (226) | (9) |
Income tax paid | (1,115) | (883) | (1,857) |
Net cash (outflow)/inflow from operating activities | (1,175) | (1,072) | 2,906 |
Cash flows from investing activities | |||
Interest received and similar income | 15 | 13 | 111 |
Purchase of property, plant and equipment | (3,560) | (855) | (1,004) |
Purchase of intangible asset | - | - | (1) |
Proceeds from sale of property, plant and equipment | 9 | - | 2 |
Proceeds from prior year sale of property | - | 360 | 360 |
Net cash outflow from investing activities | (3,536) | (482) | (532) |
Cash flows before financing activities | |||
Finance leases repaid | (11) | (10) | (21) |
Borrowings received | 2,700 | - | - |
Proceeds from borrowings | - | - | (3,924) |
Equity dividends paid | (1,171) | (1,002) | (1,574) |
Preference dividend paid | (39) | (39) | (79) |
Purchase of own shares | - | (183) | (208) |
Net cash inflow/(outflow) from financing activities | 1,479 | (1,234) | (5,806) |
Decrease in cash and cash equivalents for the period | (3,232) | (2,788) | (3,432) |
Cash and cash equivalents at beginning of the period | 7,113 | 10,545 | 10,545 |
Cash and cash equivalents at end of the period | 3,881 | 7,757 | 7,113 |
JAMES LATHAM PLC
| ||||||
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY | ||||||
Issued capital £000 | Share-based payment reserve £000 | Own shares £000 | Capital reserve £000 | Retained earnings £000 | Total equity £000 | |
As at 1 April 2010 | 5040 | 30 | (203) | 3 | 37,365 | 42,235 |
Profit for the year | - | - | - | - | 5,884 | 5,884 |
Other comprehensive income: | ||||||
Actuarial loss on defined 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 |
Transaction 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 |
Profit for the period | - | - | - | - | 3,073 | 3,073 |
Other comprehensive income: | ||||||
Actuarial loss on defined benefit pension scheme | - | - | - | - | (4,171) | (4,171) |
Deferred tax relating to components of other comprehensive income | - | - | - | - | 1,081 | 1,081 |
Total comprehensive income for the period | - | - | - | - | (17) | (17) |
Transactions with owners: | ||||||
Dividends | - | - | - | - | (1,171) | (1,171) |
Change in investment in ESOP shares | - | - | 42 | - | - | 42 |
Share-based payment expense | - | 32 | - | - | - | 32 |
Total transactions with owners | - | 32 | 42 | - | (1,171) | (1,097) |
Balance at 30 September 2011 | 5,040 | 111 | (359) | 3 | 39,907 | 44,702 |
JAMES LATHAM PLC | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NOTES TO THE HALF YEARLY REPORT | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
1. The results presented in this report are unaudited and they have been prepared in accordance with the recognition and measurement of International Financial Reporting Standards ('IFRS') as adopted by the EU that are expected to be applicable to the financial statements for the year ending 31 March 2012 and on the basis of the accounting policies to be used in those financial statements. The figures for the year ended 31 March 2011 are extracted from the statutory accounts of the group for that period. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2. The directors propose an interim dividend of 3.0p per ordinary share which will absorb £571,000 (2010: 3p absorbing £571,000), payable on 25 January 2012 to shareholders on the Register at the close of business on 6 January 2012. The ex-dividend date will be 4 January 2012. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
3. This half yearly report does not constitute financial statutory accounts within the meaning of section 434 of the Companies Act 2006. Statutory accounts for the year ended 31 March 2011 were prepared and filed with the Registrar of Companies and received an unqualified audit report and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
4. Earnings per ordinary share is calculated by dividing the net profit for the year attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the year. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months to 30 Sept 2011 unaudited | Six months to 30 Sept 2010 unaudited | Year to 31 March 2011 audited | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
£000 | £000 | £000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net profit attributable to ordinary shareholders | 3,073 | 3,402 | 5,884 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Number '000 | Number '000 | Number '000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Weighted average share capital | 19,038 | 19,070 | 19,074 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Add: diluted effect of share capital options issued | 270 | 189 | 200 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Weighted average share capital for diluted earnings per ordinary share calculation | 19,308 | 19,259 | 19,274 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
5. Net cash flow from operating activities
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6. Copies of this statement will be sent to all shareholders and will also be available on written application to the Company Secretary, James Latham plc, Unit 3 Swallow Park, Finway Road Hemel Hempstead, Herts, HP2 7QU. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||