5 Jun 2008 07:00
| For Immediate Release | 5 June 2008 |
Redhall Group plc
("Redhall" or the "Group")
Interim Results for the six months ended 31 March 2008
Redhall Group plc, the specialist engineering support services group, announces its interim results for the six months ended 31 March 2008.
FINANCIAL HIGHLIGHTS
Revenue up 86% at £41.5m (H1 2007: £22.3m)
Profit before tax up 116% to £1.9m (H1 2007 : £0.9m)*
Fully diluted earnings per share up 45% to 6.70p (H1 2007: 4.61p)
Interim dividend of 1.5p per share (H1 2007: 1.0p)
Order book at £85m (H1 2007: £60m)
*Before exceptional items and amortisation of intangible assets
OPERATIONAL HIGHLIGHTS
Nuclear Services Division
Operating profit increased 46% with margins up to 7.4%
Agreement signed with ONET broadening pan-European scope
Currently bidding for two major projects at Sellafield
Awarded Contractor of the Year 2008 at Sellafield and Aldermaston
Preferred bidder for £22m supply of Spent Fuel Storage Facilities at Sellafield
Engineering Services Division
Operating profit increased 181% with margins up to 7.5%
Preferred bidder status for carbon fibre line by Bluestar
Increased activity in oil and gas storage tank refurbishment
Booth Industries awarded contracts with combined value of £4.3m in April and May
David Jackson, Chairman and Chief Executive of Redhall, commented:
"We have an expanding market, solid trading with improving margins, a firm order book, an untarnished reputation, no debt, strong institutional support, a quality European partner and an ability to attract additional quality engineering staff. We are in a position to move on from the solid base that we have created during the last two years."
For more information please contact:
| Redhall Group plc | Tel: +44 (0)1924 385 386 |
| David Jackson, Chairman and Chief Executive | |
| Simon Foster, Deputy Chief Executive | |
| Christopher Lewis-Jones, Group Finance Director | |
| Buchanan Communications | Tel: +44 (0) 20 7466 5000 |
| Tim Anderson / Isabel Podda / James Strong | |
| Altium Capital | |
| Phil Adams / Paul Lines | Tel: +44 (0) 161 831 9133 |
Notes to the Editor:
Redhall is a well established engineering services group serving a range of specialist markets including nuclear, oil and gas, food manufacturing and defence. The business operates in regulatory driven markets with high barriers to entry. In addition to its national skill base Redhall has an experienced central management team led by David Jackson, Simon Foster and Tony Price.
Chairman's Statement
Introduction
The business has made further substantial progress in the first half of this financial year with improved trading results, improved margins and an improved order book. The markets we are working in show no signs of the recessionary tendencies being experienced elsewhere in the economy and we continue to run the business with a growth strategy that encompasses organic, acquisition and strategic partnership opportunities.
Trading Results
We are delighted to report much improved interim trading results, slightly ahead of management expectations. Revenue increased 86% at £41.5m (2007: £22.3m) and adjusted profit before taxation and amortisation at £1.9m up 116% from the 2007 comparative of £0.9m. The result for the six months to 31 March 2008 incorporates full contributions from Jex Engineering and Steels Engineering which were not included for the entire 2007 comparative. The most accurate indicator of our improvement is fully diluted earnings per share which increased by 45% to 6.70p (2007: 4.61p).
We are reporting this year in two divisions which more appropriately reflects how the Group is managed and how our individual businesses interact and focus on their key markets.
Nuclear Services
Nuclear Services now incorporates Jordan Nuclear, Jordan Manufacturing and Steels Engineering Services primarily focusing on turnkey projects to the civil and military nuclear markets.
Revenue in the Nuclear Services Division stood at £18.1m an increase of 39% on 2007 revenue of £13.0m. Operating profit totalled £1.3m compared to £0.9m an increase of 46%. Operating margin increased to 7.4% for the current year compared to 7.0% last year. These results underline the considerable growth in our Nuclear Services business. The number of employees working within Nuclear Services now totals 425 compared to 143 when the current group management commenced in October 2005.
Engineering Services
Engineering Services includes Jex Engineering, Jordan Engineering and Booth Industries which operate in the oil and gas, speciality chemical, food and pharmaceutical markets.
Revenue in this division stood at £23.3m, up 152% from the 2007 comparative of £9.3m. Operating profit totalled £1.7m, up 181% from the 2007 comparative of £0.6m. Operating margin increased to 7.5% in 2008 from 6.7% in 2007.
Operating Review
Overall we are highly satisfied with trading in the first half of the financial year. We have six businesses operating at the highest level within their sectors and the synergies identified on the acquisition of Steels and Jex are now beginning to bear fruit. The Board could not be more pleased with the way in which our two acquisitions have settled into the Group.
Nuclear Services
Civil Nuclear
SPRS has made a significant contribution to the financial performance of Nuclear Services in the first half. Since 1 April 2008 we have been working under a novated contract directly with Sellafield Limited. Anticipated completion of the contract is 31 January 2009. One of the challenges of the business has been to replace this major contract and we are pleased with the progress that we have made in selling our nuclear services to a wider audience.
We are pleased that Jordan Nuclear has this year received the Resident Engineer's Award at Sellafield in recognition of their commitment to health and safety and their excellence as a contractor.
Military Nuclear
Steels has made a very pleasing contribution to first half profits. Our investments since acquisition and AWE's increasing confidence in Steels, has resulted in us operating at a run rate more than double that on acquisition in January 2007. Our project and re-kit services have grown significantly in the period and we anticipate strong demand in the next two years in those restricted areas where security clearance is required. We are pleased that Steels has been awarded Contractor of the Year status at Aldermaston.
Specialist Manufacturing
Financial performance in Specialist Manufacturing was slightly behind management expectations in the first half due to a delay in the award of a major contract which has now been received. However, the quality of work done by this operating unit during the last two years has now enabled us to secure orders that should maintain production at full capacity for the next four years.
Engineering Services
Food, Chemical & Pharmaceutical
We have been delighted with the performance and progress of Jex since the business was acquired at the end of May 2007. In addition to making a significant contribution to the financial performance of the Group, Jex has also been successful in obtaining preferred bidder status for the carbon fibre line at the Humberbank facility of Bluestar, the Chinese chemical manufacturer. This contract is due to be signed shortly and is the first major step in the diversification strategy which we employed post-acquisition. We have also received our first design contract in the pharmaceuticals market which we are also targeting for new business.
Oil & Gas
Another satisfying performance by Jordan Engineering with increased activity in the tank refurbishment market. Given the issues surrounding UK energy security together with ongoing health and safety demands this market looks set to provide significant opportunities over the next few years. The continuing increase in oil prices should also provide further opportunity for Jordan Engineering due to client's increased focus on UK production efficiency.
Specialist Manufacturing
Booth Industries has performed in line with management expectations which is commendable given that no major contract was in production during the first half of the year. This has now changed and projects totalling £4.3m have been won in the last two months with the prospect of further major work for the HEFF facility at Aldermaston for which we have already undertaken the design.
Financial Position
During the first half of the financial year we have remained cash positive throughout. On average during the period our cash deposit amounted to approximately £5.2m. Cash generated from operations in the first half was £2.7m compared to £0.7m in 2007. The net increase in cash and cash equivalents was £1.7m (2007: £0.3m). We anticipate that the business should continue to remain cash generative notwithstanding investment to support the growth in our manufacturing operations to service several major contracts recently won.
The effective rate of tax is 18% of profit before tax and reflects further recognition of historical tax losses this year. At 31 March 2008 we have £2.6m of tax losses unrecognised in our deferred taxation account. Due to the nature of these losses we anticipate the benefit from the recognition of these tax losses to become less significant in future years.
We have reported this period's results in accordance with IFRS (International Financial Reporting Standards) as required. The transition from UK GAAP (UK Generally Accepted Accounting Practice) to IFRS was covered in our announcement of 14 April 2008.
Dividend
The Board has recommended an interim dividend of 1.5p per share (2007: 1.0p) in line with its stated policy of a minimum of three times cover. The dividend will be paid on 11 July 2008 to shareholders on the register on 13 June 2008.
Prospects
We continue to experience growth in our core markets notwithstanding the difficulties in the economy in general. This underlines the special nature of our business and the special nature of the markets that we are working in. There is a growing appreciation amongst our client base of the merits of the Redhall brand and this is leading us to larger tendering opportunities and larger contract wins. Our order book now stands at approximately £85m compared to £60m at this time last year.
We were pleased to announce, on 3 April 2008, the signing of the Memorandum of Understanding with our French counterpart ONET Technologies which has given our nuclear offering in the UK and Europe considerably greater scope. During the summer we shall be bidding for two major projects at Sellafield for which we have pre-qualified totalling in excess of £200m in association with our partner ONET. We are also talking to ONET about projects in Europe and they are assisting our specialist manufacturing unit in its expansion into the French nuclear market.
We were delighted to be able to announce last month the award of preferred bidder status for the supply of Spent Fuel Storage Facilities for use on the Sellafield site. We can confirm that this contract should be signed shortly with an estimated initial value of £22m. This contract will provide the backbone to our manufacturing operations in Yate for the next four years.
In Military Nuclear we are pleased that Steels has recently undertaken work for British Energy and continues to work towards the increased diversification of our client base outside of AWE into a broader based offering for the wider MOD market.
In Engineering Services we continue to develop the speciality chemical and pharmaceutical markets and anticipate the carbon fibre and waste to energy markets in particular making a major contribution to future workload. In oil and gas the tank refurbishment market affords major opportunity.
In specialist manufacturing we are pleased with Booth Industries order book and in particular the potential at AWE looks outstanding until 2014. We are currently in discussion with AWE on a framework agreement to assist them in design, manufacture and installation.
We continue to seek complementary acquisitions and in particular, we remain interested in adding more electrical contracting skills to our portfolio. We may also add to our specialist fabrication capacity given the order book for the next four years.
We have an expanding market, solid trading with improving margins, a firm order book, an untarnished reputation, no debt, strong institutional support, a quality European partner and an ability to attract additional quality engineering staff. We are in a position to move on from the solid base that we have created during the last two years.
David Jackson
Chairman & Chief Executive
5 June 2008
Redhall Group plc
Consolidated interim income statement
| Note | Six months to 31 March 2008 | Six months to 31 March 2007 | Year to 30 September 2007 | |||
| £000 | £000 | £000 | ||||
| Revenue | 2 | 41,475 | 22,268 | 57,049 | ||
| Cost of sales | (34,242) | (18,584) | (47,349) | |||
| Gross profit | 7,233 | 3,684 | 9,700 | |||
| Administrative expenses | (5,413) | (2,891) | (7,376) | |||
| Operating profit | 2 | 1,820 | 793 | 2,324 | ||
| Financial income | 640 | 391 | 951 | |||
| Financial expenses | (691) | (415) | (993) | |||
| Profit before tax | 1,769 | 769 | 2,282 | |||
| Adjusted PBTA* | 1,902 | 880 | 2,388 | |||
| Exceptional item | - | (102) | - | |||
| Amortisation of intangible assets | (133) | (9) | (106) | |||
| Profit before tax | 1,769 | 769 | 2,282 | |||
| Tax on profit on ordinary activities | 3 | (318) | (54) | (308) | ||
| Profit attributable to equity holders of the parent company | 1,451 | 715 | 1,974 | |||
| Earnings per share | 4 | |||||
| Basic | 6.80p | 4.75p | 11.42p | |||
| Diluted | 6.70p | 4.61p | 11.14p | |||
* Adjusted PBTA is profit before tax, exceptional items and amortisation of intangible assets.
Redhall Group plc
Consolidated interim balance sheet
| Note | As at 31 March 2008 | As at 31 March 2007 | As at 30 September 2007 | |||
| £000 | £000 | £000 | ||||
| Assets | ||||||
| Non-current assets | ||||||
| Purchased goodwill | 10,085 | 1,751 | 10,085 | |||
| Intangible assets | 1,471 | 522 | 1,565 | |||
| Property, plant and equipment | 4,513 | 2,663 | 4,391 | |||
| Deferred tax assets | 393 | 1,063 | 393 | |||
| 16,462 | 5,999 | 16,434 | ||||
| Current assets | ||||||
| Inventories | 330 | 262 | 303 | |||
| Trade and other receivables | 21,332 | 13,374 | 21,609 | |||
| Cash and cash equivalents | 5,310 | 1,038 | 3,658 | |||
| 26,972 | 14,674 | 25,570 | ||||
| Assets held for sale | 249 | - | - | |||
| Liabilities | ||||||
| Current liabilities | ||||||
| Trade and other payables | (18,635) | (12,245) | (18,450) | |||
| Current tax payable | (318) | (57) | (48) | |||
| Loans and borrowings | (370) | (13) | (125) | |||
| (19,323) | (12,315) | (18,623) | ||||
| Non-current liabilities | ||||||
| Loans and borrowings | (4,581) | - | (4,827) | |||
| Retirement benefit obligations | (647) | (4,025) | (647) | |||
| (5,228) | (4,025) | (5,474) | ||||
| Net assets excluding retirement benefit obligation and related deferred tax | 19,598 | 7,127 | 18,373 | |||
| Net assets | 19,132 | 4,333 | 17,907 | |||
| Shareholders equity | ||||||
| Share capital | 5,331 | 3,966 | 5,331 | |||
| Share premium account | 1,116 | 1,117 | 1,116 | |||
| Merger reserve | 12,679 | 2,042 | 12,679 | |||
| Revaluation reserve | 804 | 703 | 804 | |||
| Other reserve | 80 | 14 | 37 | |||
| Retained earnings | (878) | (3,509) | (2,060) | |||
| Total equity | 7 | 19,132 | 4,333 | 17,907 |
Redhall Group plc
Consolidated interim statement of recognised income and expense
| Six months to 31 March 2008 | Six months to 31 March 2007 | Year to 30 September 2007 | ||||
| £000 | £000 | £000 | ||||
| Gain on revaluation of properties | - | - | 101 | |||
| Actuarial gain on pension scheme | - | - | 339 | |||
| Tax on items taken directly to or transferred from equity | - | - | 64 | |||
| Net income recognised directly in equity | - | - | 504 | |||
| Profit for the period | 1,451 | 715 | 1,974 | |||
| Total recognised income and expense for the period | 1,451 | 715 | 2,478 | |||
| Attributable to equity holders of the parent company | 1,451 | 715 | 2,478 |
Redhall Group plc
Consolidated interim cash flow statement
| Note | Six months to 31 March 2008 | Six months to 31 March 2007 | Year to 30 September 2007 | |||
| £000 | £000 | £000 | ||||
| Cash generated from operations before special pension contribution | 5 | 2,651 | 675 | 2,583 | ||
| Special pension contribution | - | - | (3,000) | |||
| Cash generated from operations | 2,651 | 675 | (417) | |||
| Interest paid | (191) | (3) | (136) | |||
| Income taxes paid | (48) | - | (602) | |||
| Net cash from operating activities | 2,412 | 672 | (1,155) | |||
| Cash flows from investing activities | ||||||
| Acquisition of businesses net of cash acquired | - | (16) | (102) | |||
| Purchase of property, plant and equipment | (604) | (236) | (487) | |||
| Purchase of intangible assets | (39) | - | (78) | |||
| Proceeds from sale of equipment | 13 | - | 8 | |||
| Interest received | 144 | 35 | 163 | |||
| Net cash used in investing activities | (486) | (217) | (496) | |||
| Cash flows from financing activities | ||||||
| Proceeds from issue of share capital | - | 27 | 27 | |||
| Proceeds from long-term borrowing | - | - | 5,000 | |||
| Cost of long-term borrowing | - | - | (57) | |||
| Payment of finance lease liabilities | (5) | (9) | (13) | |||
| Dividends paid | (269) | (158) | (371) | |||
| Net cash used in financing activities | (274) | (140) | 4,586 | |||
| Net increase in cash and cash equivalents | 6 | 1,652 | 315 | 2,935 | ||
| Cash and cash equivalents at beginning of period | 3,658 | 723 | 723 | |||
| Cash and cash equivalents at end of period | 5,310 | 1,038 | 3,658 |
Redhall Group plc
Notes to the consolidated interim financial statements
1. Basis of preparation
These consolidated interim financial statements are for the six months ended 31 March 2008. They have been prepared with regard to the requirements of IFRS 1 "First-time Adoption of International Financial Reporting Standards" relevant to interim reports, because they are part of the period covered by the Group's first IFRS financial statements for the year ending 30 September 2008. The financial information set out in these consolidated interim financial statements does not constitute statutory accounts as defined in S240 of the Companies Act 2005. They do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements (prepared under United Kingdom Generally Accepted Accounting Practice ("UK GAAP")) of the Group for the year ended 30 September 2007 which contained an unqualified audit report and have been filed with the Registrar of Companies. They did not contain statements under S237(2) or S237(3) of the Companies Act 1985.
These financial statements have been prepared under the historical cost convention, except for revaluation of certain properties and financial instruments.
These consolidated interim financial statements (the interim financial statements) have been prepared in accordance with the accounting policies set out in the IFRS Transition Document ("IFRS Transition Document") which was released on 14 April 2008 and is available on the Group's website at www.redhallgroup.co.uk/ir-pr.asp.
The Group's consolidated financial statements were prepared in accordance with United Kingdom Accounting Standards (UK GAAP) until 30 September 2007. The date of transition to IFRS was 1 October 2006. The comparative figures in respect of 2007 have been restated to reflect changes in accounting policies as a result of adoption of IFRS. The disclosures required by IFRS 1 concerning the transition from UK GAAP to IFRS are given in the reconciliation schedules, presented and explained in the IFRS Transition Document.
The accounting policies have been applied consistently throughout the Group for the purposes of preparation of these consolidated interim financial statements.
2. Segment analysis
Primary business segments
The revenues and profit before tax generated by each of Redhall Group plc's primary business segments are summarised as follows:
Six months to 31 March 2008
| Revenue | Operating profit before intangible asset amortisation | Intangible asset amortisation | Group operating profit | ||||
| £000 | £000 | £000 | £000 | ||||
| Nuclear services | 18,126 | 1,333 | (27) | 1,306 | |||
| Engineering services | 23,349 | 1,742 | (106) | 1,636 | |||
| Central costs | - | (1,122) | - | (1,122) | |||
| Total continuing operations | 41,475 | 1,953 | (133) | 1,820 | |||
| Financial income | 640 | - | 640 | ||||
| Financial expenses | (691) | - | (691) | ||||
| Group profit before tax | 1,902 | (133) | 1,769 |
Six months to 31 March 2007
| Revenue | Operating profit before intangible asset amortisation | Intangible asset amortisation | Group operating profit | ||||
| £000 | £000 | £000 | £000 | ||||
| Nuclear services | 13,016 | 915 | (9) | 906 | |||
| Engineering services | 9,252 | 620 | - | 620 | |||
| Central costs | - | (733) | - | (733) | |||
| Total continuing operations | 22,268 | 802 | (9) | 793 | |||
| Financial income | 391 | - | 391 | ||||
| Financial expenses | (415) | - | (415) | ||||
| Group profit before tax | 778 | (9) | 769 |
Year to 30 September 2007
| Revenue | Operating profit before intangible asset amortisation | Intangible asset amortisation | Group operating profit | ||||
| £000 | £000 | £000 | £000 | ||||
| Nuclear services | 28,260 | 1,854 | (35) | 1,819 | |||
| Engineering services | 28,789 | 2,070 | (71) | 1,999 | |||
| Central costs | - | (1,494) | - | (1,494) | |||
| Total continuing operations | 57,049 | 2,430 | (106) | 2,324 | |||
| Financial income |
| 951 |
| - |
| 951 | |
| Financial expenses | (993) | - | (993) | ||||
| Group profit before tax | 2,388 | (106) | 2,282 |
Geographical segments
The following table shows the distribution of the Group's consolidated revenue by geographical market, regardless of the origin of the goods or services.
| Six months to 31 March 2008 | Six months to 31 March 2007 | Year to 30 September 2007 | |||
| £000 | £000 | £000 | |||
| United Kingdom | 39,972 | 20,244 | 53,455 | ||
| Other European Union countries | 508 | 360 | 648 | ||
| Other overseas locations | 995 | 1,664 | 2,946 | ||
| 41,475 | 22,268 | 57,049 |
3. Taxation
Current tax
Current tax expense for the interim periods represents the expected tax payable on the taxable income for the period, calculated at the estimated average annual effective income tax rate applied to the pre-tax income of the interim period. Current tax for current and prior periods is classified as a current liability to the extent that it is unpaid. Amounts paid in excess of amounts owed are classified as a current asset.
Deferred tax
The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates that are enacted or substantively enacted at the balance sheet date.
Deferred tax expense arises from the origination and reversal of temporary differences, the effects of changes in tax rates and the benefit of tax losses both utilised and recognised.
4. Earnings per share
Basic earnings per share
The calculation of basic earnings per share of 6.80p (31 March 2007: 4.75p; 30 September 2007: 11.42p) is based on 21,323,434 shares (31 March 2007: 15,047,224; 30 September 2007: 17,282,345), being the weighted average number of shares in issue throughout the period and on earnings of £1,451,000 (31 March 2007: £715,000; 30 September 2007: £1,974,000).
Diluted earnings per share
The calculation of diluted earnings per share of 6.70p (31 March 2007: 4.61p; 30 September 2007: 11.14p) is based on profit for the period of £1,451,000 because there were no adjustments required (31 March 2007: £715,000; 30 September 2007: £1,974,000 - no adjustments were required for either period) and on 21,666,674 ordinary shares (31 March 2007: 15,516,537; 30 September 2007: 17,721,920) as calculated below.
| Six months to 31 March 2008 | Six months to 31 March 2007 | Year to 30 September 2007 | |||
| £000 | £000 | £000 | |||
| Earnings: | |||||
| Profit on ordinary activities after tax | 1,451 | 715 | 1,974 | ||
| Adjusted profit | 1,451 | 715 | 1,974 | ||
| Number | Number | Number | |||
| Basic weighted average number of shares | 21,323,434 | 15,047,224 | 17,282,345 | ||
| Dilutive potential ordinary shares arising from share options | 343,240 | 469,313 | 439,575 | ||
| Adjusted weighted average number of shares | 21,666,674 | 15,516,537 | 17,721,920 |
Adjusted earnings per share
The Directors believe that helpful additional earnings per share calculations are earnings per share on adjusted bases. The basic and adjusted weighted average numbers of shares are set out above. The adjusted earnings have been calculated as follows:
| Six months to 31 March 2008 | Six months to 31 March 2007 | Year to 30 September 2007 | |||
| £000 | £000 | £000 | |||
| Earnings: | |||||
| Profit on ordinary activities after tax | 1,451 | 715 | 1,974 | ||
| Exceptional item | - | 102 | - | ||
| Amortisation of intangible assets | 133 | 9 | 106 | ||
| Tax on adjustments | (37) | (11) | (30) | ||
| Adjusted profit | 1,547 | 815 | 2,050 | ||
| Adjusted basic earnings per share | 7.25p | 5.42p | 11.86p | ||
| Adjusted diluted earnings per share | 7.14p | 5.26p | 11.57p |
The exceptional item at 31 March 2007 related to employer's national insurance paid in connection with the exercise of certain share options under a private arrangement. In the intervening period to 30 September 2007, HM Revenue & Customs agreed that the national insurance was not due and repaid it to the Company. There was therefore no exceptional charge for the year ended 30 September 2007.
5. Cash flow from operating activities
| Six months to 31 March 2008 | Six months to 31 March 2007 | Year to 30 September 2007 | |||
| £000 | £000 | £000 | |||
| Profit after taxation | 1,451 |
| 715 |
| 1,974 |
| Adjustments for: | |||||
| Depreciation | 222 |
| 148 |
| 349 |
| Amortisation of intangible assets | 133 |
| 9 |
| 106 |
| Difference between pension charge and cash contributions | - |
| (133) |
| (185) |
| Profit on sale of property, plant and equipment | (2) | - | (1) | ||
| Share based payments charge | 43 |
| 14 |
| 37 |
| Financial income | (640) |
| (391) |
| (951) |
| Financial expenses | 691 |
| 415 |
| 993 |
| Taxation expense recognised in income statement | 318 |
| 54 |
| 308 |
| Decrease/(increase) in trade and other receivables | 277 | (2,326) | (2,857) | ||
| Increase in inventories | (27) |
| (44) |
| (25) |
| Increase in trade and other payables | 185 |
| 2,214 |
| 2,835 |
| Cash generated from operations before special pension contribution | 2,651 |
| 675 |
| 2,583 |
6. Reconciliation of net cash flow to movement in net funds/(debt)
| Six months to 31 March 2008 | Six months to 31 March 2007 | Year to 30 September 2007 | |||
| £000 | £000 | £000 | |||
| Increase in cash in the period | 1,652 | 315 | 2,935 | ||
| Cash outflow from decrease in debt and lease financing | 1 | 9 | 13 | ||
| New bank loan, net of costs | - | - | (4,943) | ||
| Change in net funds/(debt) arising from cash flows during the period | 1,653 | 324 | (1,995) | ||
| Opening net (debt)/funds | (1,294) | 701 | 701 | ||
| Closing net funds/(debt) | 359 | 1,025 | (1,294) |
Analysis of net funds/(debt)
| As at 31 March 2008 | As at 31 March 2007 | As at 30 September 2007 | |||
| £000 | £000 | £000 | |||
| Cash and cash equivalents - current assets | 5,310 | 1,038 | 3,658 | ||
| Interest bearing loans and borrowings - current liabilities | (370) |
| (13) |
| (125) |
| Interest bearing loans and borrowings - non-current liabilities | (4,581) |
| - |
| (4,827) |
| Closing net funds/(debt) | 359 | 1,025 | (1,294) |
7. Reconciliation of movements in equity
| Six months to 31 March 2008 £000 | Six months to 31 March 2007 £000 | Year to 30 September 2007 | |||
| £000 | £000 | £000 | |||
| Opening equity | 17,907 | 1,705 | 1,705 | ||
| Profit for the period | 1,451 | 715 | 1,974 | ||
| Actuarial gains on defined benefit pension scheme | - | - | 339 | ||
| Movement in deferred tax relating to the pension scheme | - |
| - |
| (102) |
| Surplus on revaluation of properties | - | - | 101 | ||
| Dividends paid to shareholders | (269) | (158) | (371) | ||
| Issue of shares | - | 2,057 | 14,058 | ||
| Share based payments | 43 | 14 | 37 | ||
| Deferred tax on share options taken straight to equity | - |
| - |
| 166 |
| Net increase in equity | 1,225 | 2,628 | 16,202 | ||
| Closing equity | 19,132 | 4,333 | 17,907 |
8. Dividends on equity shares
Amounts recognised as distributions to equity holders in the period:
| Six months to 31 March 2008 | Six months to 31 March 2007 | Year to 30 September 2007 | |||
| £000 | £000 | £000 | |||
| Final dividend for the year ended 30 September 2006 (1.00p per share) | - | 158 | 158 | ||
| Interim dividend for the year ended 30 September 2007 (1.00p per share) | - | - | 213 | ||
| Final dividend for the year ended 30 September 2007 (1.25p per share) | 269 | - | - | ||
| Amount recognised as distribution to equity holders in the period | 269 | 158 | 371 |
The Directors have proposed an interim dividend for the six months ended 31 March 2008 of 1.50p per ordinary share. This proposed interim dividend was recommended by the Board of Directors on 5 June 2008 and has therefore not been included as a liability in these financial statements.
9. Distribution of interim report
Copies of this interim report are being sent to shareholders and are available from the Company Secretary, Redhall Group plc, 1 Red Hall Court, Wakefield, WF1 2UN.