Resolute Mining Regulatory News (RSG)

30 Nov 2006 07:01

Reliance Security Group PLC30 November 2006 EMBARGOED UNTIL 7.00 AM THURSDAY 30 NOVEMBER 2006 PRESS RELEASE Reliance Security Group plc Interim Results for the six months to 27 October 2006 •Turnover up 5.5% to £165.9 m (2005: £157.4m) •Profit before tax up 2.7% to £5.9m (2005: £5.8m pre exceptionals*) •Forward Facilities Management order book £724m (£716m at April 2006) •Earnings per share up 11.2% to 19.8p (2005:17.8p pre exceptionals*) •Dividend per share up 6.7% to 4.8p (2005: 4.5p) Brian Kingham, Chairman commenting on the results said: 'The first half year has delivered to our expectations with steadily improvingmarket conditions, increased sales and a gradual build up in new businessprospects. The uncertainties surrounding private security regulation are liftingand we have seen improved market conditions and new business wins. Ourfacilities management and business process outsourcing activities, in which weare continuing to invest, have enjoyed increased sales in this large and growingmarket' Notes to Editors Reliance is an established market leader in the provision of contract security,facilities management, support services, and business process outsourcing.Reliance employs over 12,000 people from a network of offices throughout the UK. For further information: Julian Nicholls Managing Director 01895 205 002 Mark Harrison Group Finance Director 01895 205 002 (* 2005 comparatives have been restated for the effect of adoption of FRS 20accounting standard on share options) Chairman's interim statementfor the six months ended 27 October 2006 The first half year has delivered to our expectations with steadily improvingmarket conditions, increased sales and a gradual build up in new businessprospects. The uncertainties surrounding private security regulation are liftingand we have seen improved market conditions and new business wins. Ourfacilities management and business process outsourcing activities, in which weare continuing to invest, have enjoyed increased sales in this large and growingmarket. Results Turnover for the six months to 27 October 2006 increased by 5.5% to £165.9million (2005: £157.4 million). Pre-tax profit was £5.9 million (2005: £5.8million pre exceptionals) and earnings per share were 19.8p (2005:17.8p preexceptionals). Cash flow has again been strong and, with £1.6 million cashgenerated in the first half, we ended the half-year with net cash of £22.7million (April 2006: £21.1 million). There were no exceptional items during theperiod (2005: £1.5 million, primarily relating to net costs incurred inpreparing for security industry regulation) Dividend The directors have decided to pay an increased interim dividend of 4.8p pershare (2005: 4.5p), payable on 19 January 2007 to shareholders on the registerat 29 December 2006. Security Services Turnover was up 5.4% at £98.9million (2005: £93.8 million). Segment operatingprofit was £1.6 million (2005: £1.3 million pre exceptional), reflecting astrong performance in our manned security business. As a result, operatingmargin, the ratio of segment profit to turnover, increased to 1.6% (2005:1.3%). Effective control over working capital, which excludes cash balances, resultedin net operating liabilities of £0.3 million (2005: £1.6 million). The new management team is now fully established and has made excellent progressin bringing renewed vigour to our work to innovate in customer care, peopledevelopment and teamwork. We have won important long-term contracts withSainsbury's, Pilkington, DHL, Deloitte and others. Regulation of the private security industry, which became effective in March2006, continues to have a positive impact. With welcome support from ourRegulator, the Security Industry Authority, recovery of the substantialadditional costs incurred in complying with regulation has been negotiated withour customers and is now largely reflected in our terms of business. This newenvironment, whilst heralding higher costs for our customers, with increasedpressure for substitution, has helped to widen the market for our services. Ithas given further impetus to the development of the 'wider policing' family anda mixed economy of public, private, charitable and 'not for profit' provision ofpolicing and security services. Facilities Management Turnover was up 5.5% at £67.1 million (2005: £63.6 million) due to both newcontract starts and growth in existing contracts. Segment operating profit was £4.2 million (2005: £3.9 million) and segmentoperating margin was 6.2% (2005: 6.1%). During the period we have improved theprofitability of continuing contracts. Overheads increased, reflecting furtherinvestment in business development resources to drive continuing growth. We maintained effective control over working capital and, with no significantincrease in our contract start-up costs, we have reduced our operating assetsover the past twelve months by 3.0%. The first half has been a busy period; not only have we increased our pipelineof opportunities, but we have mobilised a number of important contracts,including with Infineum UK Limited, the AA, Panasonic, Slough Shopping Centreand Indesit. We also participated in the ground breaking ceremony for our new 30year PFI contract with the Kent Police Authority. At the end of the half-year, our forward order book (being the sales value ofcontracts currently in hand over the remaining life of those contracts) hadincreased slightly to £724 million (April 2006: £716 million). People The Reliance Academy has continued to support the enhancement of our people'sknowledge and performance. In September we were delighted to be recognised bythe Corporate Research Foundation as one of the best companies in Britain towork for. We are profiled in Guardian Books 'Britain's Top Employers'. As previously announced we welcomed Mark Harrison as Group Finance Director on10 October 2006, having previously been chief financial officer of ACR LogisticsUK (formerly Hays Logistics) until its sale earlier this year. Neil French ourformer Group Finance Director, and latterly non executive director, resignedfrom the board on 6 October 2006. I take this opportunity to thank Neil for hisfantastic support and his work in building the strong financial managementregime that we now enjoy. We continue to strengthen our operating company boards. In July 2006, we weredelighted to welcome Mark Underwood as Managing Director of Reliance Secure TaskManagement Ltd. Mark has a record of success in setting up large, complexoutsourced operations and brings us specialist experience in IT solutions. InSeptember 2006 we welcomed Peter Fisher as Managing Director of RelianceIntegrated Services Ltd. Peter, formerly with the AA, brings to the Group strongmarketing skills and service industry branding expertise. Outlook The security services market continues to adjust to the higher costs of aregulated environment. There are new market opportunities and a ready demand forsubstitution and technological change which the Group is well resourced to meet.We anticipate further improvement in market conditions favouring a greateremphasis on higher value added services, as well as longer term contractualrelationships with customers. Our markets in facilities management and business process outsourcing are largeand diverse. We have continued to invest in new skills and technologies to meetcustomer demands for innovation and change and we look forward to continuingsteady growth. The Group remains well positioned for long-term growth and the board'sexpectations for the full year remain unchanged. Brian KinghamChairman30 November 2006 INDEPENDENT REVIEW REPORT TO RELIANCE SECURITY GROUP PLC Introduction We have been instructed by the company to review the financial information forthe 26 week period ended 27 October 2006 which comprises the consolidated profitand loss account, the consolidated statement of total recognised gains andlosses, the consolidated balance sheet, the consolidated cash flow statement andrelated notes 1 to 10. We have read the other information contained in theinterim report and considered whether it contains any apparent misstatements ormaterial inconsistencies with the financial information. This report is made solely to the company, in accordance with Bulletin 1999/4issued by the Auditing Practices Board. Our work has been undertaken so that wemight state to the company those matters we are required to state to them in anindependent review report and for no other purpose. To the fullest extentpermitted by law, we do not accept or assume responsibility to anyone other thanthe company, for our review work, for this report, or for the conclusions wehave formed. Directors' responsibilities The interim report, including the financial information contained therein, isthe responsibility of, and has been approved by, the directors. The directorsare also responsible for ensuring that the accounting policies and presentationapplied to the interim figures are consistent with those applied in preparingthe preceding annual accounts except where any changes, and the reasons forthem, are disclosed. Review work performed We conducted our review in accordance with the guidance contained in Bulletin1999/4 issued by the Auditing Practices Board for use in the United Kingdom. Areview consists principally of making enquiries of group management and applyinganalytical procedures to the financial information and underlying financial dataand, based thereon, assessing whether the accounting policies and presentationhave been consistently applied unless otherwise disclosed. A review excludesaudit procedures such as tests of controls and verification of assets,liabilities and transactions. It is substantially less in scope than an auditperformed in accordance with International Standards on Auditing (UK andIreland) and therefore provides a lower level of assurance than an audit.Accordingly, we do not express an audit opinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications thatshould be made to the financial information as presented for the 26 week periodended 27 October 2006. Deloitte & Touche LLPChartered AccountantsLondon30 November 2006 Reliance Security Group plcConsolidated profit and loss accountfor the six months ended 27 October 2006 Unaudited Unaudited Audited Restated (*) Restated (*) Six months to Six months to Year to 27 October 28 October 28 April 2006 2005 2006 Notes £'000 £'000 £'000--------------------- ------ --------- --- ---------- --------- -------- Turnover: Group andshare of joint venture - excluding exceptional item 3 165,948 157,360 317,483 - exceptional item 4 - - 758--------------------- ------ --------- --- ---------- --------- -------- 165,948 157,360 318,241 Less: share of jointventure's turnover (714) - (259)--------------------- ------ --------- --- ---------- --------- -------- Group turnover 3,4 165,234 157,360 317,982 ---------- --------- -------- Cost of sales - excluding exceptional item (134,320) (128,273) (257,598) - exceptional item 4 - (1,244) (3,828) ---------- --------- -------- Total cost of sales (134,320) (129,517) (261,426)--------------------- ------ --------- --- ---------- --------- -------- Gross profit 30,914 27,843 56,556 ---------- --------- -------- Administrative expenses - excluding exceptional items (26,214) (24,455) (48,835) - exceptional items 4 - (264) (398) ---------- --------- -------- Total administrativeexpenses (26,214) (24,719) (49,233) --------------------- ------ --------- --- ---------- --------- -------- Group operating profitexcluding share ofjoint venture and associate 4,700 3,124 7,323 ---------- --------- --------Share of jointventure's operating profit/(loss) 3 344 (90) 154 Share of associate's operating profit 3 755 598 1,274 ---------- --------- -------- Total share of operating profits of joint venture and associate 1,099 508 1,428--------------------- ---------- --------- -------- Operating profit: Group and share ofjoint venture and associate 3 5,799 3,632 8,751--------------------- ---------- --------- -------- Finance income/(charges) ---------- --------- -------- Group 480 632 1,050 Joint venture (350) - (137) Associate 8 8 13 ---------- --------- -------- Net finance income 138 640 926--------------------- ---------- --------- -------- Profit on ordinary activities before taxation 5,937 4,272 9,677 Tax on profit on ordinary activities 5 (1,784) (1,281) (2,830) --------------------- ---------- --------- -------- Profit on ordinaryactivities aftertaxation and for the period 7 4,153 2,991 6,847--------------------- ---------- --------- -------- Earnings per ordinary share Basic 6 19.8p 13.1p 30.9p--------------------- ---------- --------- -------- Diluted 6 19.4p 13.1p 30.9p--------------------- ---------- --------- -------- Dividend per ordinaryshare for the period 4.8p 4.5p 20.0p--------------------- ---------- --------- -------- All of the activities of the Group are classed as continuing. (*) The restatements relate to the adoption of FRS 20 as set out in note 2. Reliance Security Group plcConsolidated statement of total recognised gains and lossesfor the six months ended 27 October 2006 Unaudited Unaudited Audited Six months to Restated (*) Restated (*) 27 October Six months to Year to 2006 28 October 28 April 2005 2006-------------------------- ------ --------- --- --------- --------- Note £'000 £'000 £'000-------------------------- ------ --------- --- --------- --------- Profit/(loss) forthe period - Group 3,625 2,657 5,943 --------- --- --------- --------- - Joint venture (6) (90) 17 - Associate 534 424 887 --------- --- --------- ---------Total recognisedgains and lossesrelating to theperiod 4,153 2,991 6,847 --------- ---------Prior yearadjustment inrespect ofadoption of FRS 20 2 139-------------------------- ------ --------- --- --------- ---------Total recognisedgain since lastfinancialstatements 4,292-------------------------- ------ --------- --- --------- --------- (*) The restatements relate to the adoption of FRS 20 as set out in note 2. Reliance Security Group plcConsolidated balance sheetas at 27 October 2006 Unaudited Unaudited Audited Restated (*) Restated (*) 27 October 28 October 28 April 2006 2005 2006 Note £'000 £'000 £'000-------------------------- ----- --------- --------- -------- Fixed assets Tangible assets 5,511 5,702 5,445 Investments --------- --------- -------- Share of gross assets of 10,402 10,290 10,602joint venture Share of gross liabilitiesof joint venture (10,524) (10,513) (10,718) --------- --------- --------Share of net liabilitiesof joint venture (122) (223) (116) Associated undertaking 131 231 135 Others 1,702 467 1,701 --------- --------- -------- Total investments 1,711 475 1,720 7,222 6,177 7,165 Current assets Stocks 1,714 1,468 1,725 Debtors: amounts due within one year 40,755 34,841 36,488 Debtors: amounts due aftermore than one year 3,474 4,718 3,493 Cash at bank and in hand 22,831 33,452 24,557 68,774 74,479 66,263 Liabilities: amounts falling due within one year Borrowings (61) (3,379) (3,376) Creditors (45,985) (41,630) (41,250) Corporation tax (2,257) (1,793) (2,069) -------------------------- ----- --------- --------- -------- (48,303) (46,802) (46,695)-------------------------- ----- --------- --------- -------- Net current assets 20,471 27,677 19,568-------------------------- ----- --------- --------- -------- Total assets less current liabilities 27,693 33,854 26,733 Liabilities: amountsfalling due after morethan one year Borrowings (93) (154) (124) Other creditors (60) (23) (44)-------------------------- ----- --------- --------- -------- (153) (177) (168) -------------------------- ----- --------- --------- -------- Net assets 27,540 33,677 26,565-------------------------- ----- --------- --------- -------- Capital and reserves Called up share capital 1,095 1,165 1,095 Capital redemption reserve 70 - 70 Share premium account 2,534 2,534 2,534 Own shares held (5,025) (2,825) (5,025) Revaluation reserve 232 152 232 Share option reserve 229 85 157 Profit and loss account 28,405 32,566 27,502-------------------------- ----- --------- --------- -------- Equity shareholders' funds 7 27,540 33,677 26,565-------------------------- ----- --------- --------- -------- (*) The restatements relate to the adoption of FRS 20 as set out in note 2. Reliance Security Group plcConsolidated cash flow statementfor the six months ended 27October 2006 Unaudited Unaudited Audited Six months to Six months to Year to 27 October 28 October 28 April 2006 2005 2006 Notes £'000 £'000 £'000--------------------------- ------ --------- --------- ------- Net cash inflow fromoperating activities 8 6,183 8,367 11,835 --------------------------- --------- --------- ------- Dividends from associate 539 441 1,005--------------------------- ------ --------- --------- ------- Returns on investment andservicing of finance Interest received 602 710 1,238 Interest paid (98) (137) (281) Interest element of financelease repayments (8) (22) (31)--------------------------- ------ --------- --------- ------- Net cash inflow from returns oninvestment and servicing of finance 496 551 926--------------------------- ------ --------- --------- ------- Taxation UK corporation tax paid (1,384) (2,033) (3,399)--------------------------- ------ --------- --------- ------- Capital expenditure andfinancial investment Purchase of tangible fixed assets (962) (472) (1,389) Sale of tangible fixed assets - 4 18 Loan advanced to joint venture - (1,122) (1,122) Purchase of fixed assetinvestment (2) - ---------------------------- ------ --------- --------- ------- Net cash outflow from capital expenditure and financial investment (964) (1,590) (2,493)--------------------------- ------ --------- --------- ------- Equity dividends paid (3,250) (3,301) (4,245)--------------------------- ------ --------- --------- ------- Net cash inflow before financing 1,620 2,435 3,629--------------------------- ------ --------- --------- ------- Financing Payments to redeem equity shares - - (7,660) Payments to acquiretreasury shares - - (2,200) Payments of expenses onredemption of equity sharesand acquisition of treasury shares - - (236) Repayment of ESOP loan (3,315) - - Capital element of financelease repayments (31) (90) (83)--------------------------- ------ --------- --------- ------- Net cash outflow from financing (3,346) (90) (10,179)--------------------------- ------ --------- --------- ------- (Decrease)/increase in cashin the period (1,726) 2,345 (6,550) --------------------------- ------ --------- --------- ------- Reconciliation of cash flow tomovement in net cash (Decrease)/increase in cashin the period (1,726) 2,345 (6,550) Repayment of ESOP loan 3,315 - - Cash flow from finance leases 31 (155) (122)--------------------------- ------ --------- --------- ------- Movement in net cash in theperiod 1,620 2,190 (6,672) Net cash at start of period 21,057 27,729 27,729--------------------------- ------ --------- --------- ------- Net cash at end of period 9 22,677 29,919 21,057--------------------------- ------ --------- --------- ------- Reliance Security Group plc Notes 1 Preparation of interim report The financial information for the 26 weeks ended 27 October 2006 and ended 28 October 2005 is unaudited and does not constitute full accounts within the meaning of the Companies Act 1985. The financial information for the 52 weeks ended 28 April 2006 does not constitute statutory accounts but has been extracted from the full accounts for that year which have been delivered to the Registrar of Companies. The auditors' report was unqualified and did not contain a statement under Section 237(2) or (3) of the Companies Act 1985. The financial years of all Group companies are the 52 or 53 weeks up to the Friday before, or falling on, the accounting reference date of 30 April. 2 Principal accounting policies The results for the 26 weeks ended 27 October 2006 have been prepared using the same accounting policies set out in the Annual Report and Accounts for the year ended 28 April 2006 with the exception of the adoption of Financial Reporting Standard 20 Share-based payment (FRS 20). The Group had previously estimated the value of its share options in accordance with UITF 17 Employee Share Schemes. The adoption of FRS 20 has resulted in the Group restating its operating profit, net assets and reserves for the prior periods to reflect the revised basis of calculating the charges and liabilities relating to its share options issued since November 2002. Under FRS 20 equity-settled share based payments are measured at fair value at the date of grant and this is expensed on a straight-line basis over the vesting period, based on the Group's estimate of the shares that will eventually vest. In addition, the Group has estimated the corresponding charge to class 1A National Insurance Contributions (NIC) which will arise on its estimate of the number of shares which will eventually vest. Deferred tax is recognised in respect of the total charge made. A transfer to a share option reserve is made each period to match the fair value of the share options which has been charged to the profit and loss account. The Group's estimated liability to NIC is held as a creditor on the balance sheet. The adoption of FRS 20 has resulted in a lower profit and loss account charge than under UITF 17. The charges for the periods ended 28 April 2006 and 28 October 2005 are £70,000 and £63,000 lower before tax respectively and £49,000 and £44,000 lower after tax respectively. The opening net assets and reserves for the periods ended 28 April 2006 and 28 October 2005 have been increased by £147,000 to reflect the cumulative effect of the implementation of FRS 20 on the prior periods, while the opening net asset position for the period ending 27 October 2006 has increased by £296,000. The increases in closing net assets and reserves for 28 April 2006 and 28 October 2005 were £149,000 and £72,000 respectively, reflecting the restatement of profit after tax and a transfer made to the share option reserve of £100,000 and £28,000 respectively. The net impact of the cumulative effect of implementation of FRS 20 on the opening net assets, the restated profit after tax and the transfer to the share option reserve have created an opening balance for the six months ended 27 October 2006 on the share option reserve of £157,000 and increased the opening balance on the profit and loss reserve by £139,000, which has been recorded as a prior year adjustment in the statement of total recognised gains and losses. 3 Segmental information Restated (*) Six Months to 27 October 2006 Six Months to 28 October 2005 -------------------- ------------------- Security Facilities Total Security Facilities Total Services Management Services Management £'000 £'000 £'000 £'000 £'000 £'000------------------ -------- --------- ------- -------- -------- ------- Group turnover 98,862 66,372 165,234 93,790 63,570 157,360------------------ -------- --------- ------- -------- -------- ------- Share of jointventure'sturnover - 714 714 - - ------------------- -------- --------- ------- -------- -------- ------- Turnover:Group andshare of jointventure 98,862 67,086 165,948 93,790 63,570 157,360------------------ -------- --------- ------- -------- -------- ------- Groupoperatingprofit beforeexceptionalitems,excludingshare of jointventure andassociate 1,631 3,069 4,700 1,252 3,380 4,632 -------- --------- ------- -------- -------- ------- Share of jointventure'soperatingprofit /(loss) - 344 344 - (90) (90) Share ofassociate'soperatingprofit - 755 755 - 598 598 -------- --------- ------- -------- -------- -------Total share ofoperatingprofits ofjoint ventureand associatebeforeexceptionalitems - 1,099 1,099 - 508 508------------------ -------- --------- ------- -------- -------- ------- Operatingprofit beforeexceptionalitems: Groupand share ofjoint ventureand associate 1,631 4,168 5,799 1,252 3,888 5,140------------------ -------- --------- ------- -------- -------- -------Groupoperatingexceptionalitems - - - (1,371) (137) (1,508) ------------------ -------- --------- ------- -------- -------- -------Profit/(loss)on ordinaryactivitiesbefore financeincome/(charges) 1,631 4,168 5,799 (119) 3,751 3,632 ------------------ -------- --------- ------- -------- -------- ------- In accordance with the equity method adopted for accounting for associates,Group turnover excludes its share of turnover of its associated undertaking of £14,908,005 (2005: £10,502,000). (*) See note 2 3 Segmental information (continued) Restated (*) Six Months to 27 October 2006 Six Months to 28 October 2005 ------------------ ------------------- Security Facilities Total Security Facilities Total Services Management Services Management £'000 £'000 £'000 £'000 £'000 £'000------------------ ------- --------- ------ ------- -------- -------- Groupoperatingassets/(liabilities) (252) 4,894 4,642 (1,607) 5,046 3,439 Share of jointventure's netliabilities - (122) (122) - (223) (223) Share ofassociate'snet assets - 131 131 - 231 231------------------ ------- --------- ------ ------- -------- -------- Totaloperatingassets/(liabilities) (252) 4,903 4,651 (1,607) 5,054 3,447------------------ ------- --------- ------ ------- -------- -------- Reconciliation oftotal operatingassets to totalnet assets: Totaloperatingassets 4,651 3,447 Items excluded: Net cash 22,677 29,919 Investments inotherparticipatinginterests 581 467 Amounts duefrom jointventure 1,122 1,122 Taxationpayable (2,257) (1,793) Deferredtaxation 710 402 Net interestreceivable 56 113--------------- ---------- --------- ------ ------- -------- -------- Total netassets (*) 27,540 33,677--------------- ---------- --------- ------ ------- -------- -------- Operating assets are those net assets controlled by Reliance's operatingdivisions. (*) See note 2. 4 Exceptional items Unaudited Unaudited Audited Six months to Six months to Year to 27 October 28 October 28 April 2006 2005 2006 £'000 £'000 £'000 -------------------------- ---------- --------- -------- Turnover Revenue received towards cost ofimplementation of PrivateSecurity Industry Act - - 758 Cost of sales Cost of preparation forimplementation of PrivateSecurity Industry Act - (1,244) (3,828) Administrative expenses ---------- --------- -------- Cost of preparation forimplementation of PrivateSecurity Industry Act - (179) (312) Legal and professional costs ofre-listing on AIM - (85) (86) ---------- --------- -------- - (264) (398) -------------------------- ---------- --------- -------- Total exceptional charge - (1,508) (3,468) Tax credit on exceptional charge - 453 1,040-------------------------- ---------- --------- -------- - (1,055) (2,428) -------------------------- ---------- --------- -------- All revenue and expenditure relating to compliance with the Private SecurityIndustry Act 2001 has been treated as regular, non-exceptional items withinturnover, cost of sales and administrative expenses since the Act came intoforce on 20 March 2006. 5 Taxation Corporation tax for the six months to 27 October 2006 has beencalculated using an effective rate of 30% (six months ended 28 October2005: 30%, year ended 28 April 2006: 29%). 6 Earnings per share Unaudited Unaudited Audited Restated (*) Restated (*) --------------- --------------- --- --------------- Six months ended Six months ended Year to 27 October 2006 28 October 2005 28 April 2006 --------------- --------------- --- --------------- Basic Diluted Basic Diluted Basic Diluted pence pence pence pence pence pence per per per per per per £'000 share share £'000 share share £'000 share share--------------- ------ ------ ------- ------ ------ ------- --- ------ ------ ------- Profit for theperiodattributableto equityshareholders 4,153 19.8p 19.4p 2,991 13.1p 13.1p 6,847 30.9p 30.9p Add back: Exceptionalitems (seenote 4) - - - 1,055 4.7p 4.7p 2,428 11.0p 11.0p--------------- ------ ------ ------- ------ ------ ------- --- ------ ------ ------- Earningsexcludingexceptionalitems 4,153 19.8p 19.4p 4,046 17.8p 17.8p 9,275 41.9p 41.9p--------------- ------ ------ ------- ------ ------ ------- --- ------ ------ ------- (*) See note 2 Unaudited Unaudited Audited ----------- ----------- --------- Six months Six months Year to 28 ended 27 ended 28 April 2006 October 2006 October 2005 Number Number Number -------------------------- ----------- ----------- --------- Weightedaverage numberof shares 21,912,855 23,305,592 22,808,186 Weightedaverage numberof shares heldin treasury (400,000) - (142,857)-------------------------- ----------- ----------- --------- Weightedaverage numberof shares heldin ESOP trust (542,599) (542,599) (542,599)-------------------------- ----------- ----------- --------- Shares used tocalculatebasic earningsper share 20,970,256 22,762,993 22,122,730 Dilutivepotentialshares 417,170 - --------------------------- ----------- ----------- --------- Shares used tocalculatedilutedearnings pershare 21,387,426 22,762,993 22,122,730-------------------------- ----------- ----------- --------- 7 Reconciliation of movement in equity shareholders' funds Unaudited Unaudited Unaudited Six months to Year ended Six months to 28 October 28 April 27 October 2005 2006 2006 £'000 £'000 £'000-------------------------------- --------- --------- ---------- At start of theperiod aspreviously stated 33,812 33,812 26,269 Prior periodadjustments as aresult ofadoption of FRS20(*) 147 147 296-------------------------------- --------- --------- ---------- At start ofperiod asrestated (*) 33,959 33,959 26,565 Purchase of ownshares - (10,096) - Profit onordinaryactivities aftertaxation 2,991 6,847 4,153 Share basedpayments 28 100 72 Dividends paid (3,301) (4,245) (3,250)-------------------------------- --------- --------- ---------- At end of theperiod asrestated (*) 33,677 26,565 27,540-------------------------------- --------- --------- ---------- Called Capital Share Own Revaluation Share Profit Six months up redemption premium shares reserve option and loss to 27 share reserve account held reserve account October capital 2006 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 ---------- ------- -------- ------- ------ -------- ------ ------ --------- At start of the period as previously stated 1,095 70 2,534 (5,025) 232 - 27,363 26,269 Prior period adjustments as a result of adoption of FRS20 (*) - - - - - 157 139 296 ---------- ------- -------- ------- ------ -------- ------ ------ --------- At start of period as restated (*) 1,095 70 2,534 (5,025) 232 157 27,502 26,565 Purchase of own shares - - - - - - - - Profit on ordinary activities after taxation - - - - - - 4,153 4,153 Share based payments - - - - - 72 - 72 Dividends paid - - - - - - (3,250) (3,250) ---------- ------- -------- ------- ------ -------- ------ ------ --------- At end of the period as restated (*) 1,095 70 2,534 (5,025) 232 229 28,405 27,540 ---------- ------- -------- ------- ------ -------- ------ ------ --------- In accordance with S.264 Companies Act 1985 the value of own shares held must bededucted from the profit and loss account of the Company in calculating itsdistributable reserves. (*) See note 2 8 Reconciliation of operating profit to net cash inflow from operating activities Unaudited Unaudited Audited Restated(*) Restated(*) Six months Six months Year ended ended ended 27 October 28 October 28 April 2006 2005 2006 £'000 £'000 £'000 --------- -------- -------- -------- Operating profit 4,700 3,124 7,323 Depreciation charges 893 1,151 2,272 Loss/(profit) on disposal of fixed assets 4 (2) (3) Share option expense 72 28 100 Decrease/(increase) in stocks 11 (3) (260) (Increase)/decrease in debtors (4,248) 3,622 2,317 Increase in creditors 4,751 447 86 -------------------- --------- -------- -------- -------- Net cash inflow from operating activities 6,183 8,367 11,835 ----------------- ----- --------- -------- -------- -------- (*) See note 2 9 Analysis and reconciliation of net cash Audited Unaudited -------- -------------- 28 April Cash 27 October 2006 flow 2006 £'000 £'000 £'000 -------------------- --------- -------- -------- -------- Cash at bank and in hand 24,557 (1,726) 22,831 -------------------- --------- -------- -------- -------- Loan due within one year (3,315) 3,315 - Finance leases (185) 31 (154) --------------------------- -------- -------- -------- Total borrowings (3,500) 3,346 (154) ----------------- ----- --------- -------- -------- -------- Net cash 21,057 1,620 22,677 ----------------- ----- --------- -------- -------- -------- 10 Distribution A copy of the financial information will be sent to all shareholders. Copies are available to the public from the Company's registered office at Boundary House, Cricketfield Road, Uxbridge, Middlesex, UB8 1QG or from the Company's website www.reliancesecurity.co.uk. This information is provided by RNS The company news service from the London Stock Exchange