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19 Feb 2009 07:00
RNS Number : 5495N
Northamber PLC
19 February 2009
Northamber plc (“the Company”)
Unaudited Interim Statement
for the six months ended 31 December 2008
CHAIRMAN’S STATEMENT
Results
Our trading caution, driven by the UK economy and associated trade credit risks and expressed within my statement on our first quarter’s trading, materialized, in reduced sales of £68 million (31 December 2007, £97 million).
The resultant pre-tax loss of £304,000 (31 December 2007 a pre-tax profit of £453,000) is an unavoidable consequence and our first reported loss in over 15 years or since the last UK recession. The amount of the loss was mitigated by £900,000 of further cost saving measures versus a year ago.
The trend over our first half-year with turnover almost 30% lower, also reflected UK sector statistics for sales of commercial hardware I.T. equipment.
Our product range largely encompasses discretionary corporate expenditure. The general and continuing uncertainty within the economy, and the market as a whole, remains the dominant feature of our marketplace.
The importance of cash ensures Northamber is in a particularly strong position with the strength of our balance sheet and cash reserves.
It has always been a primary feature of our management of the business that we focus on the conservation of our working capital. The current state of affairs within the industry and the country at large has once again shown this policy to be appropriate.
Because of our financial strength and being able to offer both our suppliers and our customer's opportunities, the rate of gross margin is slightly better at 6.9% than when compared with 6.5% a year ago.
Balance Sheet
Our well established policy is to conserve working capital and that we have continued to do. After £4.437 million in share buy-backs, dividends and returns to shareholders during 2007/2008, as at 31 December 2008 we retained cash reserves of £10.5 million. This compares with £11.8 million at 31 December 2007. Total net assets comparatively declined from 102p per share to 90p, and a current NAV £26.1 million down from £30.1 million the result of the above.
Dividend
With our very high levels of cash, this aspect challenged your board. It was decided to mitigate the dividend choice to one of a reduced 0.6p per share (2007 1.2p per share) interim payable to shareholders on 8 May 2009 to members on the register at 17 April 2009.
Outlook
With our strengths in distribution, together with what is becoming an essential re-engineering of the current model, we are well placed to evolve better trading practices with our partners in the trading cycle, i.e. our vendors and customers to the benefit of us all.
There seems little doubt that it may take some time before there is any noticeable upturn in the sector, therefore it would be wrong of me to be optimistic.
D.M. Phillips
Chairman
19 February 2009
ENQUIRIES
Northamber Plc
David Phillips Tel: 020 8296 7000
Charles Stanley Securities
Philip Davies Tel: 020 7149 6000
Consolidated Income Statement 6 months to 31-12-08
|
|
|
6 months ended 31.12.08
£’000
|
6 months ended 31.12.07 £’000
|
Year
ended 30.06.08 £’000
|
|
Revenue
Cost of sales
|
|
68,063
63,386
|
97,020
90,742
|
179,677
167,801
|
|
Gross Profit
Net operating expenses
|
|
4,677
5,264
|
6,278
6,157
|
11,876
11,851
|
|
Profit from operations
Investment revenue
Finance costs
|
|
(587)
283
-
|
121
332
-
|
25
602
-
|
|
Profit before tax
Tax (charge)/credit
|
3
|
(304)
61
|
453
(162)
|
627
(222)
|
|
Profit for the period from continuing operations
|
|
(243)
|
291
|
405
|
|
|
|
|
|
|
|
Earnings per ordinary share
|
|
-0.83p
|
0.96p
|
1.36p
|
|
Diluted earnings per share
|
|
-0.83p
|
0.96p
|
1.36p
|
Consolidated statement of recognised income and expense
|
Total income recognised directly in equity
|
|
(243)
|
291
|
405
|
|
Attributable to equity shareholders
|
|
(243)
|
291
|
405
|
Reconciliation of Movements in Shareholders’ Funds
|
|
6 months ended 31.12.08
£’000
|
6 months ended 31.12.07
£’000
|
Year
ended
30.06.08
£’000
|
|
Capital items
Dividends
Purchase of own shares
|
-
(114)
|
-
(702)
|
(646)
(3,791)
|
|
Total recognised income and
expense for the period
|
(114)
(243)
|
(702)
291
|
(4,437)
405
|
|
Movement in shareholders’ funds for the period
Opening equity shareholders’ funds
|
(357)
26,477
|
(411)
30,509
|
(4,032)
30,509
|
|
Closing equity shareholders’ funds
|
26,120
|
30,098
|
26,477
|
Consolidated balance sheet at 31-12-08
|
|
Notes
|
As at 31.12.08
£’000
|
As at 31.12.07
£’000
|
As at 30.06.08
£’000
|
|
Non current assets
Property, plant and equipment
|
4
|
3,101
|
3,416
|
3,267
|
|
Current assets
Inventories
Trade and other receivables
Cash and cash equivalents
|
|
11,488
18,680
10,556
|
13,979
30,180
11,811
|
10,134
22,978
13,308
|
|
|
|
40,724
|
55,970
|
46,420
|
|
Total assets
|
|
43,825
|
59,386
|
49,687
|
|
Current liabilities
Trade and other payables
Bank overdraft
Current taxation
Provisions
|
|
17,719
-
(62)
-
|
29,062
-
162
-
|
22,952
-
210
-
|
|
|
|
17,657
|
29,224
|
23,162
|
|
Non current liabilities
Deferred tax liabilities
|
|
48
|
64
|
48
|
|
Total liabilities
|
|
17,705
|
29,288
|
23,210
|
|
Net assets
|
|
26,120
|
30,098
|
26,477
|
|
Equity
Share capital
Share premium account
Capital redemption reserve fund
Retained earnings
|
|
290
5,734
1,496
18,600
|
1,469
5,734
317
22,578
|
294
5,734
1,493
18,956
|
|
|
|
26,120
|
30,098
|
26,477
|
Consolidated cash flow statement 6 months to 31-12-08
|
|
6 months to 31.12.08
£’000
|
6 months to 31.12.07
£’000
|
Year to 30.06.08
£’000
|
|
Operating activities
Operating profit from continuing operations
|
(587)
|
121
|
25
|
|
Depreciation of property, plant and equipment
(Profit)/loss on disposal of property, plant and equipment
|
195
(8)
|
219
(1)
|
425
(10)
|
|
Operating profit before changes in working capital
(Increase)/decrease in inventories
Decrease)/(increase) in trade and other receivables
(Decrease)/(increase) in trade and other payables
|
(400)
(1,354)
4,298
(5,233)
|
339
(2,251)
(3,856)
3,328
|
440
1,594
3,346
(2,782)
|
|
Cash generated from operations
Interest paid
Income taxes paid
|
(2,689)
-
(210)
|
(2,440)
-
(167)
|
2,598
-
(195)
|
|
Net cash from operating activities
|
(2,899)
|
(2,607)
|
2,403
|
|
Cash flows from investing activities
Interest received
Proceeds from disposal of property, plant and equipment
Purchase of property, plant and equipment
Income from investments
|
271
18
(40)
12
|
316
11
(83)
16
|
567
14
(134)
35
|
|
Net cash from investing activities
|
261
|
260
|
482
|
|
Cash flows from financing activities
Purchase of own shares for cancellation
Dividends paid to equity shareholders
|
(114)
-
|
(702)
-
|
(3,791)
(646)
|
|
Net cash used in financing activities
|
(114)
|
(702)
|
(4,437)
|
|
Net (decrease)/increase in cash and cash equivalents
Cash and cash equivalents at beginning of period
|
(2,752)
13,308
|
(3,049)
14,860
|
(1,552)
14,860
|
|
Cash and cash equivalents at end of period
|
10,556
|
11,811
|
13,308
|
|
Cash and cash equivalents for the purpose of this statement comprise
Cash and cash equivalents
Bank overdrafts
|
10,556
-
|
11,811
-
|
13,308
-
|
|
|
10,556
|
11,811
|
13,308
|
Notes to the accounts
1. Basis of preparation
These financial statements do not constitute statutory accounts and have not been audited. They have been prepared in accordance with International Accounting Standard (IAS) 34, Interim Financial Reporting.
2. Accounting policies
The policies set out below have been consistently applied to all the periods presented in these financial statements and will apply for the full year to 30 June 2009.
3. Tax charge
The interim period tax charge is accrued on the estimated average annual effective tax rate of 20% (6 months ended 31 December 2007: 35.7%).
4. Property, plant and equipment
|
|
6 months to 31.12.08
£’000
|
6 months to 31.12.07
£’000
|
Year to 30.06.08
£’000
|
|
At beginning of period
Additions
Disposals
Depreciation
|
3,267
40
(11)
(195)
|
3,562
83
(10)
(219)
|
3,562
134
(4)
(425)
|
|
At end of period
|
3,101
|
3,416
|
3,267
|
5. Related party transactions
Mr D M Phillips is the ultimate controlling party of the company.
During the period the director of HR, Mrs S Matthews was paid £23,652 as salary and £4,139 as benefit. Mrs S Matthews is the wife of the managing director, Mr H W Matthews. In the opinion of the directors the payments were made on an arms length basis.
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