Last checked at 7 Jun 2017 07:00
MS INTERNATIONAL plc
Results for the 52 weeks ended 29th April, 2017
Chairman's Statement
Results and Review
It has been a period of solid growth across much of the Group coupled with important and significant new investment to ensure we continue to take full advantage of future opportunities.
Revenue has increased across three of the Group's four divisions and it would have been all four had it not been for the rescheduling of a delivery, for a long standing international defence customer, into our 2017/18 financial year. Even so, overall revenue was up an impressive 9.2% at £53.82m for the year ended 29th April 2017 (2016 - £49.28m).
Investment across the divisions was considerable and wide ranging, reflecting our determination and commitment to optimise their future potential. This increased investment nevertheless impacted short term returns and profit before taxation amounted to £1.53m (2016 - £1.68m). Earnings per share were 9.1p (2016 - 9.6p).
The balance sheet is strong and at the year-end had net cash amounting to £15.21m (2016 - £12.76m).
'Defence division' markets generally remained testing, reflecting the many constraints placed on global defence ministries which are faced with numerous, diverse threats and yet often only have limited resources to support military procurement programmes. Hence, although programmes may be approved and planning initiated, thereafter they frequently become delayed; postponed or at worst, even cancelled. Despite such unpredictability, it is important that we continue to invest in extensive new product development as well as essential international marketing campaigns, as we seek to match the ever-changing requirements and expectations of the international market.
'Forgings division' lifted revenue by 6% as a result of strong growth in the United States and a good measure of recovery in our Brazilian operations. European markets serviced from our UK facility, remained relatively constant but were, as a result, highly competitive. The very recent production 'start-up phase' of our new superb and substantial fork-arm manufacturing property in South Carolina - a notable investment - is in process. Whilst there is still much to do and costs to complete, the facility will provide a significant capability to meet the opportunities of a changing market place.
'Petrol Station Superstructures division' produced an impressive performance, lifting revenue by some 26% over last year. Pleasingly, the number of petrol stations operating in the UK increased in 2016, the first upturn in several decades. Demand for new station builds, upgrades, plus repairs and maintenance work created a strong market for 'Global-MSI'. Clearly, we are also benefiting from having added the complimentary capabilities of station branding via 'Petrol Sign' to that of our established design, manufacture and construction of canopies and convenience stores. Our broader offering has enabled the division's marketing operations to gain added impetus. Elsewhere, in a response to a lean market for new petrol stations in Eastern Europe, our Polish operation successfully expanded into other markets and completed new station builds in twelve other countries around the world in addition to its native Poland.
'Petrol Station Branding division,' with operations in the Netherlands; Germany and the UK are all making progress. Towards the end of the period, we were at last able to commence initial work on an extensive programme to rebrand the estate of a major petrol station client in Germany. The Netherlands' operation continues to support the initiation of the German programme and the UK business also in its first year of operation, successfully winning business independently and also when teaming-up with the 'Petrol Station Superstructures Division', for those clients requiring a 'one-stop' turn-key service.
Outlook
We believe that the Group is in excellent shape and well positioned to achieve further progress following the considerable investment made across the various businesses. The order book is at a higher level than at this time last year; in particular there is a good level of orders in hand for both established and recently developed defence products. The new fork-arm facility in the United States has commenced some initial production and the prospects for our two divisions that service the petrol station market, look most promising.
All matters considered the Board recommends the payment of a maintained final dividend of 6.5p per share (2016 - 6.5p), making the total for the year of 8p (2016 - 8p). The final dividend is expected to be paid on 24th July 2017 to those shareholders on the register at the close of business on 23rd June 2017.
Michael Bell
6th June 2017
For any further information please contact:
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MS INTERNATIONAL plc Michael Bell | Tel: 01 302 322133 |
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Shore Capital Nomad and Broker Bidhi Bhoma/Patrick Castle | Tel: (0) 20 7408 4090 |
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Consolidated income statement | |||||||||
For the 52 weeks ended 29th April, 2017 | |||||||||
2017 | 2016 | ||||||||
Continuing operations | Total | Total | |||||||
£000 | £000 | ||||||||
Revenue | 53,823 | 49,282 | |||||||
Cost of sales | (38,875) | (36,413) | |||||||
Gross profit | 14,948 | 12,869 | |||||||
Distribution costs | (3,654) | (3,104) | |||||||
Administrative expenses | (9,523) | (7,909) | |||||||
(13,177) | (11,013) | ||||||||
Group operating profit | 1,771 | 1,856 | |||||||
Finance revenue | 33 | 47 | |||||||
Finance costs | (31) | (5) | |||||||
Other finance costs - pensions | (247) | (216) | |||||||
(245) | (174) | ||||||||
Profit before taxation | 1,526 | 1,682 | |||||||
Taxation | (28) | (98) | |||||||
Profit for the period attributable to equity holders of the parent | 1,498 | 1,584 | |||||||
Earnings per share: basic and diluted | 9.1p |
| 9.6p | ||||||
Consolidated and company statement of comprehensive income | |||||||||
For the 52 weeks ended 29th April, 2017 |
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Group | Company | ||||||||
2017 | 2016 | 2017 | 2016 | ||||||
Total | Total | Total | Total | ||||||
£000 | £000 | £000 | £000 | ||||||
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Profit for the period attributable to equity holders of the parent | 1,498 | 1,584 | 2,702 | 1,926 | |||||
Exchange differences on retranslation of foreign operations | 757 | 228 | - | - | |||||
Net other comprehensive profit to be reclassified to profit or loss in subsequent periods | 757 | 228 | - | - | |||||
Remeasurement gains/(losses) on defined benefit pension scheme | 95 | (826) | 95 | (826) | |||||
Deferred taxation on remeasurement on defined benefit scheme | (16) | 165 | (16) | 165 | |||||
Change in taxation rates | (75) | (153) | (75) | (153) | |||||
Net other comprehensive income/(loss) not being reclassified to profit or loss in subsequent periods | 4 | (814) | 4 | (814) | |||||
Total comprehensive income for the period attributable to equity holders of the parent | 2,259 | 998 | 2,706 | 1,112 | |||||
Consolidated and company statement of changes in equity | |||||||||||||||||||||||||||||
For the 52 weeks ended 29th April, 2017 | |||||||||||||||||||||||||||||
Issued capital | Capital redemption reserve | Other reserves | Revaluation reserve | Special reserve | Foreign exchange reserve | Treasury shares | Retained earnings | Total | |||||||||||||||||||||
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |||||||||||||||||||||
(a) Group | |||||||||||||||||||||||||||||
At 2nd May, 2015 | 1,840 | 901 | 2,815 | 4,146 | 1,629 | (289) | (3,059) | 20,316 | 28,299 | ||||||||||||||||||||
Profit for the period | - | - | - | - | - | - | - | 1,584 | 1,584 | ||||||||||||||||||||
Other comprehensive income/(loss) | - | - | - | - | - | 228 | - | (814) | (586) | ||||||||||||||||||||
Total comprehensive income | - | - | - | - | - | 228 | - | 770 | 998 | ||||||||||||||||||||
Dividends paid | - | - | - | - | - | - | - | (1,320) | (1,320) | ||||||||||||||||||||
Change in taxation rates | - | - | - | 83 | - | - | - | - | 83 | ||||||||||||||||||||
Depreciation of buildings revaluation | - | - | - | (7) | - | - | - | 7 | - | ||||||||||||||||||||
At 30th April, 2016 | 1,840 | 901 | 2,815 | 4,222 | 1,629 | (61) | (3,059) | 19,773 | 28,060 | ||||||||||||||||||||
Profit for the period | - | - | - | - | - | - | - | 1,498 | 1,498 | ||||||||||||||||||||
Other comprehensive income | - | - | - | - | - | 757 | - | 4 | 761 | ||||||||||||||||||||
Total comprehensive income | - | - | - | - | - | 757 | - | 1,502 | 2,259 | ||||||||||||||||||||
Dividends paid | - | - | - | - | - | - | - | (1,320) | (1,320) | ||||||||||||||||||||
Change in taxation rates | - | - | - | 42 | - | - | - | - | 42 | ||||||||||||||||||||
Depreciation of buildings revaluation | - | - | - | (7) | - | - | - | 7 | - | ||||||||||||||||||||
At 29th April, 2017 | 1,840 | 901 | 2,815 | 4,257 | 1,629 | 696 | (3,059) | 19,962 | 29,041 | ||||||||||||||||||||
(b) Company | |||||||||||||||||||||||||||||
At 2nd May, 2015 | 1,840 | 901 | 1,565 | 4,240 | 1,629 | - | (3,059) | 17,554 | 24,670 | ||||||||||||||||||||
Profit for the period | - | - | - | - | - | - | - | 1,926 | 1,926 | ||||||||||||||||||||
Other comprehensive loss | - | - | - | - | - | - | - | (814) | (814) | ||||||||||||||||||||
Total comprehensive income | - | - | - | - | - | - | - | 1,112 | 1,112 | ||||||||||||||||||||
Dividends paid | - | - | - | - | - | - | - | (1,320) | (1,320) | ||||||||||||||||||||
Change in taxation rates | - | - | - | 83 | - | - | - | - | 83 | ||||||||||||||||||||
Depreciation of buildings revaluation | - | - | - | (7) | - | - | - | 7 | - | ||||||||||||||||||||
At 30th April, 2016 | 1,840 | 901 | 1,565 | 4,316 | 1,629 | - | (3,059) | 17,353 | 24,545 | ||||||||||||||||||||
Profit for the period | - | - | - | - | - | - | - | 2,702 | 2,702 | ||||||||||||||||||||
Other comprehensive loss | - | - | - | - | - | - | - | 4 | 4 | ||||||||||||||||||||
Total comprehensive income | - | - | - | - | - | - | - | 2,706 | 2,706 | ||||||||||||||||||||
Dividends paid | - | - | - | - | - | - | - | (1,320) | (1,320) | ||||||||||||||||||||
Change in taxation rates | - | - | - | 41 | - | - | - | - | 41 | ||||||||||||||||||||
Depreciation of buildings revaluation | - | - | - | (6) | - | - | - | 6 | - | ||||||||||||||||||||
At 29th April, 2017 | 1,840 | 901 | 1,565 | 4,351 | 1,629 | - | (3,059) | 18,745 | 25,972 | ||||||||||||||||||||
Consolidated and company statements of financial position | |||||||||||||||||||||||||||||
At 29th April, 2017 | |||||||||||||||||||||||||||||
Group | Company | ||||||||||||||||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||||||||||||||||
£'000 | £'000 | £'000 | £'000 | ||||||||||||||||||||||||||
ASSETS | |||||||||||||||||||||||||||||
Non-current assets | |||||||||||||||||||||||||||||
Property, plant and equipment | 19,099 | 15,955 | 12,653 | 12,869 | |||||||||||||||||||||||||
Intangible assets | 5,301 | 5,671 | - | 4 | |||||||||||||||||||||||||
Investments in subsidiaries | - | - | 14,339 | 14,170 | |||||||||||||||||||||||||
Deferred income tax asset | 1,272 | 1,376 | 1,272 | 1,376 | |||||||||||||||||||||||||
25,672 | 23,002 | 28,264 | 28,419 | ||||||||||||||||||||||||||
Current assets | |||||||||||||||||||||||||||||
Inventories | 10,145 | 7,043 | 7,989 | 5,808 | |||||||||||||||||||||||||
Trade and other receivables | 11,393 | 8,996 | 14,566 | 9,655 | |||||||||||||||||||||||||
Income tax receivable | 199 | 118 | - | - | |||||||||||||||||||||||||
Prepayments | 943 | 784 | 824 | 682 | |||||||||||||||||||||||||
Cash and cash equivalents | 15,210 | 12,758 | 13,526 | 11,017 | |||||||||||||||||||||||||
37,890 | 29,699 | 36,905 | 27,162 | ||||||||||||||||||||||||||
TOTAL ASSETS | 63,562 | 52,701 | 65,169 | 55,581 | |||||||||||||||||||||||||
EQUITY AND LIABILITIES | |||||||||||||||||||||||||||||
Equity | |||||||||||||||||||||||||||||
Equity share capital | 1,840 | 1,840 | 1,840 | 1,840 | |||||||||||||||||||||||||
Capital redemption reserve | 901 | 901 | 901 | 901 | |||||||||||||||||||||||||
Other reserve | 2,815 | 2,815 | 1,565 | 1,565 | |||||||||||||||||||||||||
Revaluation reserve | 4,257 | 4,222 | 4,351 | 4,316 | |||||||||||||||||||||||||
Special reserve | 1,629 | 1,629 | 1,629 | 1,629 | |||||||||||||||||||||||||
Currency translation reserve | 696 | (61) | - | - | |||||||||||||||||||||||||
Treasury shares | (3,059) | (3,059) | (3,059) | (3,059) | |||||||||||||||||||||||||
Profit for the period | 1,498 | 1,584 | 2,572 | 1,755 | |||||||||||||||||||||||||
Retained earnings | 18,464 | 18,189 | 16,174 | 15,598 | |||||||||||||||||||||||||
TOTAL EQUITY SHAREHOLDERS' FUNDS | 29,041 | 28,060 | 25,973 | 24,545 | |||||||||||||||||||||||||
Non-current liabilities | |||||||||||||||||||||||||||||
Defined benefit pension liability | 7,485 | 7,644 | 7,485 | 7,644 | |||||||||||||||||||||||||
Deferred income tax liability | 1,449 | 1,590 | 911 | 987 | |||||||||||||||||||||||||
8,934 | 9,234 | 8,396 | 8,631 | ||||||||||||||||||||||||||
Current liabilities | |||||||||||||||||||||||||||||
Trade and other payables | 25,464 | 15,253 | 30,607 | 22,270 | |||||||||||||||||||||||||
Income tax payable | 123 | 154 | 193 | 135 | |||||||||||||||||||||||||
25,587 | 15,407 | 30,800 | 22,405 | ||||||||||||||||||||||||||
TOTAL EQUITY AND LIABILITIES | 63,562 | 52,701 | 65,169 | 55,581 | |||||||||||||||||||||||||
Consolidated and company cash flow statements | ||||||||||
For the 52 weeks ended 29th April, 2017 |
| Group | Company | |||||||
2017 | 2016 | 2017 | 2016 | |||||||
£000 | £000 | £000 | £000 | |||||||
Profit before taxation | 1,526 | 1,682 | 2,544 | 1,880 | ||||||
Adjustments to reconcile profit before taxation to net cash inflow/(outflow) from operating activities | ||||||||||
Depreciation charge | 1,105 | 1,060 | 853 | 861 | ||||||
Amortisation charge | 535 | 609 | 4 | 9 | ||||||
Impairment in investment in subsidiary undertaking | - | - | (155) | 28 | ||||||
Profit on sale of fixed assets | (35) | (98) | (34) | (91) | ||||||
Finance costs | 245 | 174 | 228 | 170 | ||||||
Foreign exchange gains | 419 | 83 | - | - | ||||||
(Increase)/decrease in inventories | (3,102) | 2,394 | (2,181) | 1,585 | ||||||
(Increase)/decrease in receivables | (2,397) | 840 | (4,911) | (403) | ||||||
Increase in prepayments | (159) | (194) | (142) | (187) | ||||||
Increase/(decrease) in payables | 3,126 | (1,981) | 1,409 | (1,705) | ||||||
Increase/(decrease) in progress payments | 7,085 | (2,479) | 6,928 | (2,479) | ||||||
Pension fund payments | (311) | (275) | (311) | (275) | ||||||
Cash generated from /(invested in) operating activities | 8,037 | 1,815 | 4,232 | (607) | ||||||
Net interest received | 2 | 42 | 19 | 46 | ||||||
Taxation (paid)/received | (242) | (134) | 65 | 16 | ||||||
Net cash inflow/(outflow) from operating activities | 7,797 | 1,723 | 4,316 | (545) | ||||||
Investing activities | ||||||||||
Acquisition of Petrol Sign bv | - | (2,612) | - | (2,438) | ||||||
Investment in Petrol Sign GmbH | - | - | - | (19) | ||||||
Investment in Global MSI bv | (14) | - | ||||||||
Purchase of property, plant and equipment | (4,165) | (2,330) | (720) | (1,172) | ||||||
Sale of property, plant and equipment | 140 | 149 | 117 | 141 | ||||||
Net cash outflow from investing activities | (4,025) | (4,793) | (617) | (3,488) | ||||||
Financing activities | ||||||||||
Dividends paid | (1,320) | (1,320) | (1,320) | (1,320) | ||||||
Dividend received from subsidiary | - | - | 130 | 171 | ||||||
Net cash outflow from financing activities | (1,320) | (1,320) | (1,190) | (1,149) | ||||||
Increase/(decrease) in cash and cash equivalents | 2,452 | (4,390) | 2,509 | (5,182) | ||||||
Opening cash and cash equivalents | 12,758 | 17,148 | 11,017 | 16,199 | ||||||
Closing cash and cash equivalents |
| 15,210 | 12,758 | 13,526 | 11,017 | |||||
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1 | Segment information | ||||||||||||||||||||||||||||||||||||||
The following table presents revenue and profit and certain assets and liability information regarding the Group's divisions for the periods ended 29th April, 2017 and 30th April, 2016. The reporting format is determined by the differences in manufacture and services provided by the Group. The Defence division is engaged in the design, manufacture and service of defence equipment. The Forgings division is engaged in the manufacture of forgings. The Petrol Station Superstructures division is engaged in the design, manufacture, construction, branding, maintenance and restyling of petrol station superstructures. The Petrol Station Branding division is engaged in the design and installation of the complete appearance of petrol stations. | |||||||||||||||||||||||||||||||||||||||
Management monitors the operating results of its business units separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on operating profit or loss which in certain respects, as explained in the table below, is measured differently from operating profit or loss in the consolidated financial statements. Group financing (including finance costs and finance revenue) and income taxes are managed on a group basis and are not allocated to operating segments. | |||||||||||||||||||||||||||||||||||||||
Defence | Forgings | Petrol Station | Petrol Station | Total | |||||||||||||||||||||||||||||||||||
Superstructures | Branding | ||||||||||||||||||||||||||||||||||||||
2017 | 2016 | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | ||||||||||||||||||||||||||||||
£000 | £000 | £000 | £000 | £000 | £000 | £000 | £000 | £000 | £000 | ||||||||||||||||||||||||||||||
Restated | Restated | Restated | Restated | ||||||||||||||||||||||||||||||||||||
Revenue | |||||||||||||||||||||||||||||||||||||||
External | 20,847 | 21,907 | 12,562 | 11,922 | 13,745 | 10,842 | 6,669 | 4,611 | 53,823 | 49,282 | |||||||||||||||||||||||||||||
Total revenue | 20,847 | 21,907 | 12,562 | 11,922 | 13,745 | 10,842 | 6,669 | 4,611 | 53,823 | 49,282 | |||||||||||||||||||||||||||||
Segment result | 1,822 | 1,950 | (721) | (393) | 957 | 262 | (287) | 37 | 1,771 | 1,856 | |||||||||||||||||||||||||||||
Net finance costs | (245) | (174) | |||||||||||||||||||||||||||||||||||||
Profit before taxation | 1,526 | 1,682 | |||||||||||||||||||||||||||||||||||||
Taxation | (28) | (98) | |||||||||||||||||||||||||||||||||||||
Profit for the period | 1,498 | 1,584 | |||||||||||||||||||||||||||||||||||||
Segmental assets | 30,576 | 24,607 | 5,178 | 5,250 | 8,260 | 9,525 | 5,514 | 3,668 | 49,528 | 43,050 | |||||||||||||||||||||||||||||
Unallocated assets (see below) | 14,034 | 9,651 | |||||||||||||||||||||||||||||||||||||
Total assets | 63,562 | 52,701 | |||||||||||||||||||||||||||||||||||||
Segmental liabilities | 18,333 | 10,411 | 1,905 | 1,378 | 2,572 | 2,458 | 2,644 | 985 | 25,454 | 15,232 | |||||||||||||||||||||||||||||
Unallocated liabilities (see below) | 9,067 | 9,409 | |||||||||||||||||||||||||||||||||||||
Total liabilities | 34,521 | 24,641 | |||||||||||||||||||||||||||||||||||||
Capital expenditure | 219 | 214 | 3,297 | 1,443 | 254 | 470 | 341 | 80 | 4,111 | 2,207 | |||||||||||||||||||||||||||||
Depreciation | 211 | 233 | 305 | 362 | 627 | 575 | 347 | 336 | 1,490 | 1,506 | |||||||||||||||||||||||||||||
Unallocated assets includes certain fixed assets, intangible assets, current assets and deferred tax assets. Unallocated liabilities includes the defined pension benefit scheme liability and certain current liabilities. | |||||||||||||||||||||||||||||||||||||||
Following the establishment of the Petrol Station Branding division, management have revised the allocation of certain costs which has led to a restatement of the prior year segment result for the divisions. The total segment result of the Group for the prior year remains unchanged. | |||||||||||||||||||||||||||||||||||||||
Geographical analysis | |||||||||||||||||||||||||||||||||
The following table presents revenue and expenditure and certain assets and liabilities information by geographical segment for the periods ended 29th April, 2017 and 30th April, 2016. The Group's geographical segments are based on the location of the Group's assets. Revenue from external customers is based on the geographical location of its customers. | |||||||||||||||||||||||||||||||||
Europe | North America | Rest of the World | Total | ||||||||||||||||||||||||||||||
2017 | 2016 | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | ||||||||||||||||||||||||||
£000 | £000 | £000 | £000 | £000 | £000 | £000 | £000 | ||||||||||||||||||||||||||
Revenue | |||||||||||||||||||||||||||||||||
External | 45,599 | 39,238 | 6,072 | 3,935 | 2,152 | 6,109 | 53,823 | 49,282 | |||||||||||||||||||||||||
Non-current assets | 21,230 | 21,683 | 4,351 | 1,246 | 91 | 73 | 25,672 | 23,002 | |||||||||||||||||||||||||
Current assets | 35,911 | 27,544 | 1,213 | 1,483 | 766 | 672 | 37,890 | 29,699 | |||||||||||||||||||||||||
Liabilities | 29,163 | 22,675 | 4,922 | 1,531 | 436 | 435 | 34,521 | 24,641 | |||||||||||||||||||||||||
Capital expenditure | 992 | 1,261 | 3,149 | 1,069 | 24 | - | 4,165 | 2,330 | |||||||||||||||||||||||||
Information about major customers | 2017 | 2016 | |||||||||||||||||||||||||||||||
Revenue from major customers arising from sales reported in the Defence segment: | £000 | £000 | |||||||||||||||||||||||||||||||
Customer 1 | 9,065 | - | |||||||||||||||||||||||||||||||
Customer 1 | - | 10,042 | |||||||||||||||||||||||||||||||
2 | Employee Information | 2017 | 2016 | |||
Number | Number | |||||
The average number of employees, including executive directors, during the period was: | ||||||
Production | 234 | 237 | ||||
Technical | 65 | 68 | ||||
Distribution | 30 | 31 | ||||
Administration | 80 | 59 | ||||
409 | 395 | |||||
(a) | Staff costs | 2017 | 2016 | |||
Their, including executive directors, employment costs were as follows: | £000 | £000 | ||||
Wages and salaries | 12,764 | 11,558 | ||||
Social Security costs | 1,355 | 1,227 | ||||
Other pension costs | 398 | 412 | ||||
14,517 | 13,197 | |||||
2017 | 2016 | |||||
(b) | Directors' emoluments | £000 | £000 | |||
Aggregate directors' emoluments | 1,152 | 1,128 | ||||
Post employment benefits | 31 | 31 | ||||
1,183 | 1,159 | |||||
3 | Taxation | ||||
The charge for taxation comprises: | 2017 | 2016 | |||
£000 | £000 | ||||
Current tax | |||||
United Kingdom corporation tax | 9 | 83 | |||
Tax over provided in previous years | 15 | (82) | |||
Foreign corporation tax | 116 | 150 | |||
Group current tax | 140 | 151 | |||
Deferred tax | |||||
Origination and reversal of temporary differences | (73) | (54) | |||
Adjustments in respect of prior years | (26) | 37 | |||
Impact of reduction in deferred tax rate to 17% | (13) | (36) | |||
Group deferred tax | (112) | (53) | |||
Tax on profit | 28 | 98 | |||
Tax relating to items charged or credited to other comprehensive income | |||||
Deferred tax | |||||
Deferred tax on remeasurement losses on pension scheme current year | 16 | (165) | |||
Impact of reduction in deferred tax rate to 17% | 75 | 153 | |||
Income tax in the statement of comprehensive income | 91 | (12) | |||
(b) | Factors affecting the tax charge for the year | ||||
The tax assessed for the period differs to the standard rate of corporation tax in the UK (20%) (2016 - 20%). The differences are explained below: | |||||
2017 | 2016 | ||||
£000 | £000 | ||||
Profit before tax | 1,526 | 1,682 | |||
Profit multiplied by standard rate of corporation tax of 20% (2016 - 20%) | 305 | 336 | |||
Expenses not deductible for tax purposes | (434) | (173) | |||
Adjustments in respect of overseas tax rates | 181 | 16 | |||
Current tax adjustment in respect of prior periods | 15 | (82) | |||
Deferred tax adjustment in respect of prior periods | (26) | 37 | |||
Impact of reduction in deferred tax rate to 17% | (13) | (36) | |||
Total tax charge for the period | 28 | 98 | |||
4 | Earnings per share | ||||
The calculation of basic earnings per share is based on: | |||||
(a) Profit for the period attributable to equity holders of the parent of £1,498,000 (2016 - £1,584,000). | |||||
(b) 16,504,691 (2016 - 16,504,691) Ordinary shares, being the weighted average number of Ordinary shares in issue. | |||||
This represents 18,396,073 (2016 - 18,396,073) being the weighted average number of Ordinary shares in issue less 1,891,382 (2016 - less 1,891,392) being the weighted average number of shares both held within the ESOT 245,048 (2016 - 245,048) and purchased by the Company 1,646,334 (2016 - 1,646,334). | |||||
5 | Dividends paid and proposed | 2017 | 2016 | ||
£000 | £000 | ||||
Declared and paid during the year | |||||
On Ordinary shares | |||||
Final dividend for 2016 : 6.50p (2015 - 6.50p) | 1,073 | 1,073 | |||
Interim dividend for 2017 : 1.50p (2016 - 1.50p) | 247 | 247 | |||
1,320 | 1,320 | ||||
Proposed for approval by shareholders at the AGM | |||||
Final dividend for 2017 : 6.50p (2016 - 6.50p) | 1,073 | 1,073 | |||
6 | Trade and other receivables | |||||||||||||
Group | Company | |||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||
£000 | £000 | £000 | £000 | |||||||||||
Trade receivables | 9,631 | 7,744 | 6,792 | 6,578 | ||||||||||
Retentions on contracts | 1,723 | 1,188 | 1,723 | 1,188 | ||||||||||
Amounts owed by subsidiary undertakings | - | - | 6,036 | 1,874 | ||||||||||
Other receivables | 39 | 64 | 15 | 15 | ||||||||||
11,393 | 8,996 | 14,566 | 9,655 | |||||||||||
Gross amounts due from customers for contract work - included above | 2,270 | 1,861 | 2,033 | 1,666 | ||||||||||
The aggregate amount of costs incurred and recognised profits to date on contracts is £13,679,000 (2016 - £10,775,000). | ||||||||||||||
(a) Trade receivables are denominated in the following currencies | ||||||||||||||
Group | Company | |||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||
£000 | £000 | £000 | £000 | |||||||||||
Sterling | 6,208 | 6,019 | 6,208 | 6,019 | ||||||||||
Euro | 2,578 | 983 | 593 | 559 | ||||||||||
US dollar | 516 | 361 | (14) | - | ||||||||||
Other currencies | 329 | 381 | 5 | - | ||||||||||
9,631 | 7,744 | 6,792 | 6,578 | |||||||||||
Trade receivables are non-interest bearing and are generally on 30 days terms and are shown net of provision for impairment. The aged analysis of trade receivables not impaired is as follows: | |||||||||||||||
Group | Total | Not past due | < 30 days | 30-60 days | 60-90 days | > 90 days | |||||||||
£000 | £000 | £000 | £000 | £000 | £000 | ||||||||||
2017 | 9,631 | 8,028 | 1,397 | 182 | 15 | 9 | |||||||||
2016 | 7,744 | 6,026 | 1,424 | 269 | 9 | 16 | |||||||||
As at 29th April, 2017 trade receivables at a nominal value of £84,000 (2016 - £102,000) were impaired and fully provided. Bad debts of £19,000 (2016 - £51,000) were recovered and bad debts of £17,000 (2016 - £24,000) were incurred. | |||||||||||||||
Company | |||||||||||||||
2017 | 6,792 | 5,623 | 1,139 | 30 | - | - | |||||||||
2016 | 6,578 | 5,182 | 1,158 | 238 | - | - | |||||||||
As at 29th April, 2017 trade receivables at a nominal value of £37,000 (2016 - £39,000) were impaired and fully provided. Bad debts of £6,000 (2016 - £8,000) were recovered and bad debts of £4,000 (2016 - £23,000) were incurred. | |||||||||||||||
(b) Retentions on contracts are denominated in the following currencies | |||||||||||||||
Group | Company | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
£000 | £000 | £000 | £000 | ||||||||||||
Sterling | 1,723 | 1,188 | 1,732 | 1,188 | |||||||||||
Euro | - | - | - | - | |||||||||||
US dollar | - | - | - | - | |||||||||||
Other currencies | - | - | - | - | |||||||||||
1,723 | 1,188 | 1,732 | 1,188 | ||||||||||||
Retentions on contracts are non interest bearing and represent amounts contractually retained by customers on completion of contracts for specific time periods as follows: | |||||||||||||||
Group | Total | Up to 6 months | 6 - 12 months | 12 - 18 months | 18 - 24 months | ||||||||||
£000 | £000 | £000 | £000 | £000 | |||||||||||
2017 | 1,723 | 1,723 | - | - | - | ||||||||||
2016 | 1,188 | 1,188 | - | - | - | ||||||||||
Company | |||||||||||||||
2017 | 1,723 | 1,723 | - | - | - | ||||||||||
2016 | 1,188 | 1,188 | - | - | - | ||||||||||
7 | Cash and cash equivalents | Group | Company | ||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||
£000 | £000 | £000 | £000 | ||||||||||
Cash at bank and in hand | 9,880 | 7,420 | 13,526 | 5,715 | |||||||||
Short term deposits | 5,330 | 5,338 | - | 5,302 | |||||||||
15,210 | 12,758 | 13,526 | 11,017 | ||||||||||
8 | Reserves | ||||||||||||
| |||||||||||||
Share Capital | |||||||||||||
The balance classified as share capital includes the nominal value on issue of the Company's equity share capital, comprising 10p Ordinary shares. | |||||||||||||
Capital redemption reserve | |||||||||||||
The balance classified as capital redemption reserve represents the nominal value of issued share capital of the Company, repurchased. | |||||||||||||
Other reserve | |||||||||||||
This is the revaluation reserve previously arising under UK GAAP which is now part of non-distributable retained reserves. | |||||||||||||
Revaluation reserve | |||||||||||||
The asset revaluation reserve is used to record increases in the fair value of land and buildings and decreases to the extent that such decrease relates to an increase on the same assets previously recognised in equity. This also includes the impact of the change in related deferred tax due to the change in corporation tax (18% to 17%). | |||||||||||||
Special reserve | |||||||||||||
The balance classified as special reserve represents the share premium on the issue of the Company's equity share capital. | |||||||||||||
Currency translation reserve | |||||||||||||
The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements of foreign subsidiaries. It is also used to record the effect of hedging net investments in foreign operations. | |||||||||||||
Treasury Shares | |||||||||||||
2017 | 2016 | ||||||||||||
£000 | £000 | ||||||||||||
Employee Share Ownership Trust | 100 | 100 | |||||||||||
Shares in treasury (see below) | 2,959 | 2,959 | |||||||||||
3,059 | 3,059 | ||||||||||||
During 1991 the Company established an Employee Share Ownership Trust ("ESOT"). The trustee of the ESOT is Appleby Trust (Jersey) Ltd, an independent company registered in Jersey. The ESOT provides for the issue of options over Ordinary shares in the Company to Group employees, including executive directors, at the discretion of the Remuneration Committee. | |||||||||||||
The trust has purchased an aggregate 245,048 (2016 - 245,048) Ordinary shares, which represents 1.3% (2016 - 1.3%) of the issued share capital of the Company at an aggregate cost of £100,006. The market value of the shares at 29th April, 2017 was £414,000 (2016 - £448,000). The Company has made payments of £Nil (2016 - £Nil) into the ESOT bank accounts during the period. No options over shares (2016 - Nil) have been granted during the period. Details of the outstanding share options, for Directors are included in the Directors' remuneration report. | |||||||||||||
The assets, liabilities, income and costs of the ESOT have been incorporated into the Company's financial statements. Total ESOT costs charged to the income statement in the period amounts to £5,000 (2016 - £7,000). During the period no options on shares were exercised (2016 - Nil) and no shares were purchased (2016 - Nil). | |||||||||||||
The Company made the following purchases of its own 10p Ordinary shares to be held in Treasury: | |||||||||||||
£000 | |||||||||||||
11th December, 2013 1,000,000 shares from the Group's pension scheme. | 1,722 | ||||||||||||
30th January, 2014 646,334 shares | 1,237 | ||||||||||||
2,959 | |||||||||||||
The preliminary announcement is prepared on the same basis as set out in the previous year's accounts. | |||||||||||||
The Directors confirm to the best of their knowledge that: | |||||||||||||
(a) the financial statements, prepared in accordance with International Financial Reporting Standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the group and the undertakings included in the consolidation taken as a whole; and | |||||||||||||
(b) the Chairman's Statement includes a fair review of the development and performance of the business and the position of the group and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face. | |||||||||||||
The preliminary announcement was approved by the Board on 6th June, 2017 and the above responsibility statement was signed on its behalf by Michael Bell, Executive Chairman and Michael O'Connell, Group Finance Director. | |||||||||||||
Copies of this announcement are available from the Company's registered office at MS INTERNATIONAL plc, Balby Carr Bank, Doncaster, DN4 8DH, England. The full Annual Report and Accounts will be posted to shareholders shortly and will be available on our website at www.msiplc.com and will be delivered to the Registrar of Companies after it has been laid before the Company in general meeting. | |||||||||||||