NBI.L Regulatory News (NBI)

18 Sep 2007 07:01

Northbridge Industrial Services PLC18 September 2007 FOR IMMEDIATE RELEASE 18 SEPTEMBER 2007 Northbridge Industrial Services plc. ("Northbridge" or "The Company") Interim Results for the period ended 30 June 2007 Northbridge Industrial Services plc, the industrial services and rental company,today announces its interim results for the six month period ended 30 June 2007. Financial Highlights: • Turnover of £4.8 million (2006: £2.0 million). Profit before taxation of £601,000 (2006: £226,000) Includes results of Crestchic Limited for 6 months (3 months post acquisition in the comparative period) • Continued growth in the main subsidiary Crestchic Limited o turnover up by 30% to £4.8 million (2006: £3.7 million) o operating profits up by 32% to £0.9 million (2006: £0.7 million) • Basic earnings per share of 5.8 pence (2006: 3.9 pence) and diluted earnings per share of 5.6 pence (2006: 3.8 pence) • Proposed maiden interim dividend of 1.0 pence per ordinary share (2006: nil) Operational Highlights • Loadbank Hire Services acquired on 26 March 2007 for consideration of £900,000 • Factory extension and mezzanine floor now complete on time and on budget • Further investment of £258,000 into the hire fleet • The establishment of a new trading subsidiary, Northbridge (Middle East) FZE based in the Jebel Ali Free Zone in Dubai • Acquisition of 51 per cent of RDS (Technical) Ltd, a distributor of generators and associated equipment in Azerbaijan, announced earlier today, 18 September 2007 Outlook The company has a strong sales order book for the rest of the year, andenquiries for hire are encouraging leading into 2008. As a result the Board isconfident of the future prospects of the Group and I look forward to reportingfurther progress for the year ending 31 December 2007. About Northbridge Northbridge Industrial Services was incorporated for the purpose of acquiringcompanies that hire and sell specialist industrial equipment supplying anon-cyclical customer base including utility companies, the public sector andthe oil and gas industries. In particular it will seek to acquire specialistbusinesses that have the potential for expansion into complete outsourcingproviders. For further information: Northbridge Industrial Services Plc. Eric Hook, Chief Executive 077 0283 1110 Buchanan Communications Charles Ryland / James Strong 020 7466 5000 Charles Stanley Securities Mark Taylor / Freddy Crossley 020 7739 8200 Chairman's statement I am pleased to report continued improvements in our trading for the first halfof the year ending 30 June 2007. The acquisition of Crestchic Ltd occurred onthe 28 March 2006 and therefore these interim results include a full 6 months ofCrestchic's trading. Crestchic, the main subsidiary of Northbridge, designs, manufactures, sells andhires load bank equipment which is primarily used for the commissioning andmaintenance of independent power sources such as diesel generators and gasturbines. Demand for the products continues to grow in line with the strongdemand for secure power supplies and the growth in investment in the oil and gasindustry. Financial results Northbridge's consolidated revenue for the half year was £4.8 million (2006:£2.0 million) with gross profits of £2.7 million (2006: £1.0 million). Profitbefore taxation was £601,000 (2006: 226,000). Net Assets at 30 June 2007 were£7.5 million (2006: £6.6 million). Approximately three months trading from Loadbank Hire Services ("LHS") which wasacquired in March 2007 has been included in these figures. Crestchic has achieved a 30 % increase in turnover during this six month periodto £4.8 million (2006: £3.7 million); Crestchic was acquired on 23 March 2006and so the 2006 interim results contained only three months of Crestchic'strading. Operating profits before Group costs were £906,000 (2006: £674,000), anincrease of 34%. Basic earnings per share were 5.8 pence (2006: 3.9 pence) and diluted earningsper share were 5.6 pence (2006: 3.8 pence). During the period we invested £501,000 on fixed assets in the Group (including£258,000 in the hire fleet) and £695,000 on the acquisition of LHS. At 30 June2007 gearing was 13.5%. Since the period end we have negotiated a change in our banking facilities inthe form of a mortgage against the freehold premises. The amount raised was£1.5million and the mortgage has a term of 15 years at an interest rate of 1.25%above base rate. We have also negotiated an increase in our multi-option workingcapital facility to £1 million. Dividend As a result of the Group's strong performance during the six months to 30 June 2007 the Board will pay a maiden interim dividend of 1.0 pence per ordinary share (2006: nil) on 9 November 2007 to shareholders on the register at 5 October 2007. Operations During the period work was completed on the factory extension and this togetherwith the new 2500 sq. ft. mezzanine floor has increased our production capacitysubstantially. This expansion was undertaken during a very busy period butdisruption was kept to a minimum and lead time for customers, whilst stilllonger than we would like, is back to a manageable length. In the medium termthe increase in potential throughput will enable us to increase sales and buildmore products for the hire fleet. During the period under review Northbridge has taken steps to expand itsgeographical interests by incorporating a wholly owned subsidiary in the JebelAli Free Zone in Dubai. The new company, Northbridge (Middle East) FZE, willfocus primarily on equipment rental and services to the oil and gas markets inthe Middle East and Central Asia. As a consequence of this, Crestchic have givennotice (3 months) to Byrne Equipment Rental LLC to terminate their agreement andin future Northbridge (ME) FZE, which received its trading licence on 9 August2007, will become the distributor of Crestchic's load banks for this area. Acquisitions Loadbank Hire Services ("LHS") was acquired on 26 March 2007 and its pro-formaunaudited turnover and profit before taxation for the year ended 31 March 2006were approximately £635,000 and £155,000 respectively. LHS offers very similarservices to those of Crestchic. from a depot in the South East of England andhas performed in line with our expectations. Its trade and assets are no longerdistinguishable from those of Crestchic itself. Further to receiving its trading licence Northbridge FZE has acquired 51% of theissued share capital of RDS (Technical) Ltd ("RDS") for the consideration of£650,000 from its current shareholders. RDS is a company incorporated in Jerseybut which conducts most of its business through a branch office in Baku,Azerbaijan, it also has a UK subsidiary, RDS (Trading) Ltd. RDS offers generators and associated equipment for hire and sale to a customerbase in Azerbaijan and the Caspian region and has previously acted asCrestchic's agent in the area. Outlook The Group has a strong sales order book for the rest of the year, and enquiriesfor hire are encouraging leading into 2008. As a result the Board is confidentof the future prospects of the Group and I look forward to reporting furtherprogress for the year ending 31 December 2007. Peter Harris Chairman Northbridge Industrial Services plc Consolidated Interim Income Statement For the six months ended 30 June 2007 6 Months 6 Months Year to ended ended 31st 30th June 30th June December 2007 2006 2006 Unaudited Unaudited Audited £000's £000's £000's 1 2 3 Revenue 4,772 2,000 6,933 Cost of sales (2,117) (998) (3,673) ------- ------- -------Gross profit 2,655 1,002 3,260 Selling and distribution costs (1,127) (455) (1,202)Administrative expenses (908) (312) (941) ------- ------- -------Profit from operations 620 235 1,117Finance income 8 5 14Finance costs (27) (14) (43) ------- ------- -------Profit before income tax 601 226 1,088 Income tax expense (171) (68) (357) ------- ------- ------- Profit for the period attributableto the equity holders of theparent 430 158 731 ------- ------- ------- Earnings per share - basic (pence) 5.8 3.9 12.8- diluted (pence) 5.6 3.8 12.0 Dividend per share 1.0p - 2.0p All revenue and operating profit is derived from continuing operations. 1 Includes six months of Crestchic 2 Includes three months of Crestchic 3 Includes nine months of Crestchic Northbridge Industrial Services plc Consolidated Interim Balance sheet as at 30th June 2007 30th June 30th June 31st December 2007 2006 2006 Unaudited Unaudited Audited £000's £000's £000'sAssetsNon-current assets Intangible assets 3,224 2,485 2,596Property plant & equipment 4,534 3,576 3,797 ------- ------- ------- Total non-current assets 7,758 6,061 6,393 Current assets Inventories 1,479 767 722Trade & other receivables 2,740 2,157 1,998Cash and cash equivalents - 302 1,288 ------- ------- ------- Total current assets 4,219 3,226 4,008 ------- ------- ------- Total assets 11,977 9,287 10,401 ------- ------- ------- Liabilities Current liabilities Bank overdraft (351) - (189)Trade & other payables (2,001) (1,211) (1,108)Financial liabilities (96) - (96)Other financial liabilities (65) (43) (70)Tax liabilities (509) (502) (451) ------- ------- ------- (3,022) (1,766) (1,914) Non-current liabilities Financial liabilities (502) (608) (526)Long-term provisions (265) - (265)Deferred tax liability (678) (296) (500) ------- ------- ------- (1,445) (904) (1,291) ------- ------- ------- Total liabilities (4,467) (2,670) (3,205) ------- ------- ------- Total net assets 7,510 6,617 7,196 ------- ------- ------- Capital and reserves Share capital 761 739 739Share premium account 5,527 5,530 5,527Share option reserve 20 200 209Retained earnings 1,202 148 721 ------- ------ ------- Total equity 7,510 6,617 7,196 ------- ------- ------- Northbridge Industrial Services plc Consolidated Interim Statement of Cash Flows 6 Months 6 Months Year to ended ended 30thJune 31st December 30thJune 2006 2006 2007 Audited Unaudited Unaudited £000's £000's £000's Operating activities Net profit from ordinary activities 601 226 1,088before taxationAdjustments for: Amortisation of intangible fixed assets 56 - 78Amortisation of capitalised debt fee 11 5 16Depreciation of tangible fixed assets 184 73 225Finance income (8) (6) (14)Finance costs 27 15 43Share option expense 10 - 9(Increase) in inventories (756) (167) (122)(Increase) in receivables (742) (351) (96)Increase in payables 513 52 42 ------- ------- ------- Cash (used in)/generated from (104) (153) 1,269operationsFinance costs (27) (15) (43)Taxation (80) (68) (334) ------- ------- ------- Net cash (used in)/from operating (211) (236) 892activities Cash flows from investing activities Finance income 8 6 14Purchase of operations and trade assets (695) - -Acquisition of subsidiary undertaking (net of cash acquired) - (6,376) (5,411)Sale of property, plant and equipment 17 - -Purchase of property, plant and (501) (281) (589)equipmentExpenditure on research and development - - (4) ------- ------- ------- Net cash used in investing activities (1,171) (6,651) (5,990) Cash flows from financing activities Proceeds from share capital issued 22 7,038 6,438Costs of share capital issued - (831) (834)Proceeds from bank borrowings 163 750 750Repayment of bank borrowings (63) (20) (293)Cost of raising bank borrowings - - (94)Payment of finance lease obligations (41) (12) (34)Dividends paid to equity shareholders (149) - - ------- ------- ------- Net cash flow (used in)/from financing (68) 6,925 5,933activities Net (decrease)/ increase in cash (1,450) 38 835and cash equivalentsCash and cash equivalents at beginning 1,099 264 264of period Cash and cash equivalents at end of (351) 302 1,099period Notes to the unaudited interim statements Northbridge Industrial Services plc 1. Basis of preparation of interim statement The financial information does not constitute statutory accounts within themeaning of section 240 of the Companies Act 1985. The comparatives for the fullyear ended 31 December 2006 are not the Company's full statutory accounts forthat year. A copy of the statutory accounts for that year has been delivered tothe Registrar of Companies. The auditors' report on those accounts wasunqualified, did not include references to any matters to which the auditorsdrew attention by way of emphasis without qualifying their report and did notcontain a statement under section 237(2)-(3) of the Companies Act 1985." Thisinterim statement has not been audited by the Group's auditors. 2. International Financial Reporting Standards The International Financial Reporting Standards (IFRS) adopted for use in the EUare mandatory for periods commencing after 1 January 2007. The Group adoptedIFRS for the first time for the year ending 31 December 2006 and this interimreport has been prepared in accordance with accounting policies that wereapplied in the Financial Statements for that year and in accordance with theaccounting policies that are expected to be applied in the full financialstatements for the year ended 31 December 2007 3. Acquisitions The assets of Loadbank Hire Services were acquired on 26th March 2007.Consideration for the business was £900,000 in total, excluding acquisitioncosts. £540,000 was payable immediately and the balance payable in installmentsof £90,000 each quarter for 12 months. 4. Tax on profit on ordinary activities The anticipated taxation rate on profits is estimated to be approximately 28%. 5. Earnings per share The earnings per share figure has been calculated by dividing the profit aftertaxation, £430,000, (2006: £158,000) by the weighted average number of shares inissue, 7,455,426 (2006: 4,216,725). The diluted earnings per share assumes allshare options are exercised at the start of the period or, if later, the date ofissue of the share options. 6. Dividends An interim dividend of 1.0 pence per share (2006: nil) will be paid on 9November 2007 to shareholders on the register as at 5 October 2007. Inaccordance with IFRS, no provision for the interim dividend has been made inthese financial statements 7. Interim report Copies of this interim report are being sent to all shareholders and areavailable to the public from the offices of Northbridge Industrial Services plcat Second Avenue, Centrum 100, Burton-on-Trent, Staffordshire, DE14 2WF. Thisinterim release will also be available from the Group's website atwww.northbridgegroup.co.uk . This information is provided by RNS The company news service from the London Stock Exchange