Robinson Regulatory News (RBN)

24 Mar 2006 07:01

Robinson PLC24 March 2006 FOR IMMEDIATE RELEASE 24 March 2006 Robinson plc PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005 Robinson plc ("Robinson" or "the Group"; stock code: RBN), the custommanufacturer of paperboard and plastic packaging based in Chesterfield, hasannounced its audited results for the year ended 31 December 2005. Highlights: •Sales grew by 3% to £26.65m (2004: £25.95m) •Operating profit improved to £0.52m (2004: £0.03m) •Significant investment in fixed assets, including the £1.71m purchase of a manufacturing facility in Poland •The Group's pension fund remains in surplus and has benefited from exposure to the equity markets during the year •The adoption of new accounting standards has resulted in adjustments to prior year figures of which the largest impact is the inclusion in the balance sheet of the pension fund surplus •The Board will be recommending a final dividend for the year of 1.75p per share (2004 final: 1p). This would represent an 8% increase in the total dividend payout in comparison to last year (2005: 3.25p; 2004: 3.00p) Commenting on the results, Chairman, Richard Clothier stated: "In competitive markets with escalating resin and energy prices, it is highlycreditable that the Group maintained its gross margins year-on-year. Theestablishment of our Polish manufacturing facility, key to Robinson'slonger-term growth prospects, is progressing on schedule and will begin tocontribute in the coming year. Elsewhere, we are continuing to invest in plantand machinery and to encourage innovation to ensure that the Group maintains itscompetitive edge. Overall, we expect to make further progress in 2006." About Robinson Based in Chesterfield, and with additional manufacturing facilities inKirkby-in-Ashfield, Nottinghamshire, in Toronto, Canada, and in Lodz, Poland,Robinson currently employs over 400 people. It was formerly a family business,with its origins dating back some 165 years. Today the Company's main activitiesare in the manufacture and sale of rigid paper packaging and injection mouldedplastic packaging. Robinson operates primarily within the food, drink,confectionery, cosmetic and toiletry sectors, providing niche or custommanufacture to major players in the fast moving consumer goods market, such asNestle, Lever Faberge and Whyte & Mackay. The Company also has a substantialproperty portfolio with significant development potential. For further information, please contact: Jon Marx, Chief Executive, Robinson plc 01246 220022Guy Robinson, Finance Director, Robinson plc 01246 220022 www.r1son.co.ukSue Scott/Michael Padley, Bankside Consultants 020 7367 8888 CHAIRMAN'S STATEMENT Sales Total sales of £26.65m were 3% higher than in the previous year (2004: £25.95m).The growth was attributable to the performance of the plastics business whichoffset a decline in sales within the UK paperboard business. Paperboard revenues fell due to lower sales to the Toiletries & Cosmetics sectorin the UK whilst the North American business benefited for a second year growthin packaging for tooth whitening strips. This business has now been lost to acheaper packaging format. The launch of our innovative paperboard COOL-AIRtube during the year has generated promising sales in the drinks sector. Profitability Our gross margin remained at 15.5% reflecting improved productivity at alloperations and our ability to largely pass on the significant increases inplastic polymer prices and energy costs. The operating profit before exceptional items improved modestly to £0.53m (2004:£0.46m). Exceptional items included the £0.27m costs of setting up the Polishmanufacturing facility which was offset by a £0.30m reversal of impairment ofvalue of a surplus paperboard line that was subsequently sold. The operatingprofit after exceptional items was £0.52m (2004: £0.03m) Interest payable in 2005 was £0.04m (2004: £0.15m interest receivable),reflecting increased investment in fixed assets (including Poland) in theperiod. Other financial income in respect of the Pension Fund (FRS17) produced a gain of£0.87 million compared with £1.04m in 2004; the reduction was due to lowerprojected returns on assets and higher interest on scheme liabilities. The profit before taxation was £1.35m (2004: £1.45m). Cash & Finances Our balance sheet remains robust with year end net debt of £2.35m (2004: netcash - £1.82m) substantially covered by surplus property values. Capitalexpenditure of £4.12m was well above the annual depreciation figure of £1.70m,as we continued to invest in new plant and equipment. The main investments werein the new plastics plant in Poland (£1.71m) and a new paperboard box line inChesterfield. We also paid £0.82m into an escrow account in respect of companypension contributions, of which £0.62m was provided at the end of 2004. Workingcapital levels increased partly as a result of the higher input prices andpartly because debtors were low the previous year. The net cash inflow fromoperations during the year amounted to £0.40m. Dividends The Board will be recommending a final dividend for the year of 1.75p per share(2004 final: 1p) which will be paid on 9 June 2006 to shareholders on theregister at the close of business on 12 May 2006. Pension Fund Our pension fund remains in a healthy position. We closed the final salary(defined benefit) section to new entrants in 1997 and since then have beenoperating a money purchase (defined contribution) scheme. With the sales ofbusinesses that have taken place over the past 15 years and the rationalisationof the workforce, the fund is very mature. The latest actuarial valuation at 5April 2005 indicated a surplus of 8%. We have adopted the new accountingstandard (FRS17). The fund has assets with a market value of £52m andliabilities of £45m giving a surplus after tax of £5m at the end of 2005. Thepresent value of scheme liabilities has increased by a further £4m during theyear, much of which is due to the increased mortality rates used. Property We continue to seek planning permission for residential redevelopment on theprevious Robinson Healthcare site at Walton. We are in discussion withprospective purchasers for the sale of this site and the Wheatbridge site andhope to conclude the sales during 2006. The property acquired in Poland extends to 2.3 hectares with factory/warehousespace of 10,000 m2 and office space of 2,000 m2. Approximately 50% of this spaceis currently let out to external tenants, yielding an income of around £0.1m perannum. The property is held on a long lease (87 years) and cost £1.3m. We willspend a further £0.5m in renovating the property to bring it up to modern foodpackaging standards. Located in Lodz, in the centre of Poland, the property isclose to the proposed new North-South/East-West motorway intersection. As weexpand our business in Poland, it is our intention to further renovate theproperty and displace the external tenants. Acquisitions We continue to seek acquisitions of packaging businesses at the right price thatwe feel have appropriate synergies and long term prospects for inclusion withinthe Group. Outlook Our aim remains to develop the business both through organic growth andacquisition. Our focus on product development and innovation remains a priority.Raw material costs remain at very high levels and have eased only slightly goingin to 2006. Energy prices are still increasing at rates much higher than thegeneral inflation level and we expect electricity costs to rise further in 2006.Sales are currently tracking in line with expectations. It is anticipated thatthe business in Poland will make a modest contribution in the current financialyear and, overall, we expect to make further progress in 2006. Richard Clothier 24 March 2006ChairmanRobinson plc GROUP PROFIT AND LOSS ACCOUNTFOR THE YEAR ENDED 31 DECEMBER 2005 Notes 2005 2004 (restated) £'000 £'000 Turnover 26,648 25,949Cost of sales (22,512) (21,919) ------ ------Gross Profit 4,136 4,030 Overheads, excluding exceptional items (3,608) (3,571)Exceptional items (9) (430) ------- -------Total Overheads (3,617) (4,001) Operating Profit 519 29Profit on disposal of land and buildings - 236 --- ---Profit on ordinary activities before interest 519 265Interest (payable)/received (40) 146Other finance income in respect of Pension Fund 870 1,040 ----- -----Profit on ordinary activities before taxation 1,349 1,451Taxation 2 (320) (532) ----- -----Profit on ordinary activities after taxation 1,029 919 ===== =====Earnings per ordinary 0.5p shareBasic and diluted (p) 4 6.5 5.3 All amounts relate to continuing operations The accounting policies and notes form an integral part of the financialstatements STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSESFOR THE YEAR ENDED 31 DECEMBER 2005 Notes 2005 2004 (restated) £'000 £'000 Profit for the financial year 1,029 919Actuarial gain/(loss) in respect of the Pension Fundnet 297 (1,623)of deferred taxCurrency translation differences on foreign currencynet investments 82 (25) ----- ----Total gains/(losses) recognised since last annual 1,408 (729)report ==== Prior year adjustments 5 4,219 Total gains and losses since the last financial -----statements 5,627 ===== GROUP BALANCE SHEETAS AT 31 DECEMBER 2005 Notes 2005 2004 (restated) £'000 £'000 Fixed assets Tangible fixed assets 17,440 15,001 ------ ------ 17,440 15,001 Current assets Stocks 1,997 1,640Debtors 7,246 5,437Current asset investments - 1,002Cash 28 813 ----- ----- 9,271 8,892 Creditors: amounts falling due within one year (8,588) (5,412) ------ -----Net current assets 683 3,480 Total assets less current liabilities 18,123 18,481Provisions for liabilities (607) (614) ------ ------Net assets excluding pension asset 17,516 17,867Pension asset (net of deferred tax) 4,705 3,318 ------ ------Net assets including pension asset 22,221 21,185 ====== ====== Capital and reserves Called up share capital 80 80Share premium account 398 398Capital redemption reserve 216 216Revaluation reserve 5,136 5,138Profit and loss account 16,391 15,353 ------ ------Equity Shareholders' Funds 6 22,221 21,185 ====== ====== GROUP CASH FLOW STATEMENTFOR THE YEAR ENDED 31 DECEMBER 2005 Notes 2005 2004 (restated) £'000 £'000 Cash inflow from operating activities Operating profit 519 29Depreciation charges and write-down of fixed assets 1,705 1,795Reversal of impairment of fixed assets (296) -(Profit)/loss on sale of other tangible fixed assets (5) 100Increase in stocks (357) (36)(Increase)/decrease in debtors (1,732) 448Increase/(decrease) in creditors 928 (190)Decrease in provisions (7) (40)Non-cash items: - Increase in net pension asset charged to operating profit 400 400 - Cost of share options 65 23 - Transfer to pension escrow account (822) - --- -----Net cash inflow from operating activities 398 2,529 === =====Returns on investments and servicing of financeInterest received 24 194Interest paid (62) (5) Net cash (outflow)/inflow from returns on investments and --- ---servicing of finance (38) 189 === ===TaxationUK corporation tax (paid)/received (229) 3 Capital expenditure and financial investmentAcquisition of tangible fixed assets (4,119) (1,596)Sale of surplus properties - 686Sales of other tangible fixed assets 315 60 ------ ------Net cash outflow from capital expenditure and financialinvestment (3,804) (850) Equity dividends paid (488) (368) Net cash (outflow)/inflow before use of liquid resources andfinancing (4,161) 1,503 Management of liquid resourcesDecrease in short-term cash deposits with UK banks 1,002 7,580 ------ -----Net cash inflow from management of liquid resources 1,002 7,580Financing Repurchase of share capital - (8,997) ------ ------Net cash outflow from financing - (8,997) (Decrease)/increase in cash 7 (3,159) 86 ====== ====Analysis of changes in cash during the year Balance at 31 December (2,346) 813Balance at 1 January 813 727 ------ ----Net cash (outflow)/inflow (3,159) 86 ======= ==== Notes to the financial statements 1. Basis of preparation The accounts have been prepared under the historic cost convention as modifiedby the revaluation of freehold land and buildings. The Group's accounting policies have been applied on a consistent basis with theexception of the following, where comparative figures have been restatedaccordingly: a. The requirements of FRS17 on retirement benefits have been adopted inthe primary statements b. The cost of share options has been recognised in the profit and lossaccount in accordance with FRS20 c. Dividends are now recognised when paid in accordance with FRS21 2. Taxation 2005 2004 (restated) £'000 £'000 Current tax:UK corporation tax @ 30% (2004: 30%) 122 178Adjustments in respect of prior periods (77) 5Overseas tax 6 8 ---- ---Total current tax 51 191 Deferred tax:UK tax @ 30% 367 267Adjustments in respect of prior periods (98) 74 --- ---Total deferred tax 269 341 --- --- 320 532 3. Dividends 2005 2004 (restated) £'000 £'000 Ordinary : second interim paid in respect of 2004 139 228: final paid in respect of 2004 140 -: interim paid 209 140 --- --- 488 368 === === It will be proposed at the Annual General Meeting that a final dividend of 1.75pper ordinary share be paid. 4. Earnings per Share The calculation of basic and diluted earnings per ordinary share is based onprofit on ordinary activities after taxation (£1,003,000) divided by theweighted average number of shares in issue (15,918,501). 5. Prior year adjustments The Group has implemented FRS17, "Retirement Benefits", during the year. Thishas resulted in a prior year adjustment of £4,595,000 in respect of periodsprior to 31 December 2003 to recognise the asset as required by this accountingstandard. As a result the previous balance recorded in creditors of £282,000under SSAP24 has been written back. The total effect of these adjustments is anincrease of £4,877,000 in reserves brought forward at 1 January 2004. The comparative figures for the year ended 31 December 2005 have been restatedto reflect changes in the provision required under FRS17, resulting in anincrease in profit of £553,000 for that period. In addition £1,623,000 ofactuarial losses have also been recognised through reserves. The adoption of FRS21, "Post balance sheet events" has resulted in a prior yearadjustment for the company in respect of the treatment of dividends.Shareholders' funds at 1 January 2004 have been increased by £228,000. For theyear ended 31 December 2004 the change in accounting policy has resulted in anet increase in retained profit of £49,000. The balance sheet at 31 December2004 has been restated to reflect the de-recognition of a liability for proposedequity dividends of £279,000. For the year ended 31 December 2004, the change inaccounting policy has resulted in a net decrease in retained profit for the yearof £279,000. The adoption of FRS20 has resulted in a prior year adjustment of £23,000 for thecompany in respect of the cost of share options. The profit for the year hasbeen reduced but there has been a corresponding transfer to reserves with no neteffect on total revenue reserves. 5. Reconciliation of movements in shareholders' funds 2005 2004 £'000 £'000 (restated)Group Profit after taxation for the financial year 1,029 919Dividends (488) (368) ----- ---- 541 551Actuarial gain 297 -Exchange difference on translation 133 1Recognition of share based payments 65 -Purchase of own shares - (8,997) ----- ------Net (reduction in)/addition to shareholders' funds 1,036 (8,445) Shareholders' funds at 1 January (originally £16,967before 21,185 29,630adding prior year adjustments of £4,219,000) ------ ------Shareholders' funds at 31 December 22,221 21,185 ====== ====== 6. Analysis of net funds/(debt) At 1 Jan Cash At 31 Dec 2005 Flow 2005 £'000 £'000 £'000Cash in hand and deposits repayable on demand 813 (785) 28Bank overdraft - (2,374) (2,374) ----- ------ ------Cash and cash equivalents 813 (3,159) (2,346)Short term deposits with UK banks 1,002 (1,002) - ----- ------ ------ 1,815 (4,161) (2,346) 7. Publication of non-statutory accounts The financial information set out in this preliminary announcement does notconstitute statutory accounts as defined in section 240 of the Companies Act1985. The summarised balance sheet at 31 December 2005 and the summarised profit andloss account, summarised cash flow statement and associated notes for the yearthen ended have been extracted from the Group's 2005 statutory financialstatements upon which the auditors opinion is unqualified and does not includeany statement under Section 237 of the Companies Act 1985. The accounts for the year ended 31 December 2005 are expected to be posted toshareholders in due course and will be delivered to the Registrar of Companiesafter they have been laid before the company at the annual general meeting on 4May 2006. Copies will also be available from Robinson plc's Registered office:Bradbury House, Goytside Road, Chesterfield, S40 2PH. ENDS This information is provided by RNS The company news service from the London Stock Exchange