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Slingsby(H.C.)Plc - Half-year Report

Tue, 20th Aug 2019 07:00

RNS Number : 5494J
Slingsby(H.C.)Plc
20 August 2019
 

20 August 2019

H C Slingsby plc

("Slingsby" or "the Company")

 

Report for the half year ended 30 June 2019

 

Statement by the Chairman

Trading

 

In my trading update of 12 June 2019, I reported that Group sales in the five months to 31 May 2019 were 3.5% higher than prior year but that adverse movements in gross margin and overheads meant that operating profit was lower than the comparable period in 2018. Variability in order intake experienced since the decision to extend the Brexit date, the unwinding of customers' plans for this event and the economic uncertainty created, led us to be cautious regarding the short-term outlook.

 

While Group sales for the six months to 30 June 2019 were 2% higher compared with the prior year, operating profit fell by £117,000 to £93,000 (2018: £210,000) due to adverse movements in gross margin and overheads. The Group's loss before tax was £52,000 compared to a prior year profit before tax of £76,000 and is after £122,000 of finance costs relating to the company's defined benefit pension scheme (2018: £108,000).

 

We remain cautious regarding the outlook due to the continued variability in order intake, economic uncertainty and the competitive nature of the marketplace.

 

Balance sheet

 

The Group has net liabilities of £1.45m at 30 June 2019 from net assets of £0.22m at 31 December 2018.  This is largely due to an increase in the liability relating to the defined benefit pension scheme of £1.6m (after associated deferred tax).  The retirement benefit obligation increased during the six months to 30 June 2019 as a result of a change in the assumption regarding interest rates, although this was partly offset by an increase in the level of pension scheme assets despite the company making no deficit reduction contributions.

 

We remain in discussion with the trustees of the Company Pension Scheme and the relevant authorities regarding a long term solution to the pension scheme deficit and continue to pay the running costs previously agreed with the trustees of £160,000 per annum. Until these discussions regarding the defined benefit pension scheme are concluded, the quantum and timing of future deficit reduction payments in this regard are uncertain.

 

Cashflow

 

The Group had net debt of £1.30m at 30 June 2019 (£1.24m at 30 June 2018) compared to £1.15m at 31 December 2018.  Stock levels at 30 June 2019 were £0.3m higher than at 31 December 2018 (£0.5m higher than at 30 June 2018) due to the Group's Brexit preparations and sourcing strategy. The Group continues to operate within its existing banking facilities and the Directors continue to believe that the Group has additional funding options available should the need arise.

 

Dividend

 

The Board has decided not to declare an interim dividend.

 

People

 

Whilst our profit performance is reduced from that in the prior year, I would like to thank our employees across the Group for their continued hard work.

 

Dominic Slingsby

Interim Executive Chairman and Operations Director

 

For further information please contact:

H C Slingsby plc

Dominic Slingsby, Interim Executive Chairman                          01274 535 030

Morgan Morris, Group Chief Executive

 

Allenby Capital Limited

David Worlidge/Nicholas Chambers                                           020 3328 5656

 

 

Unaudited Condensed Consolidated Income Statement for the half year ended 30 June 2019

 

 

 

Half year

Half year

Year

 

 

ended

ended

ended

 

 

30/06/19

(Unaudited)

30/06/18

(Unaudited)

31/12/18

(Audited)

 

Note

£'000

£'000

£'000

 

Revenue

 

9,946

9,725 

19,817 

 

 

---------

---------

---------

Operating profit before exceptional items

 

93

210 

520 

Exceptional items

2

-

(891) 

 

 

---------

---------

---------

Operating profit/(loss)

 

93

210

(371) 

 

 

 

 

 

Finance costs

 

(145)

(134)

(262)   

 

 

--------

--------

--------

(Loss)/profit before taxation

 

(52)

76

(633)

Taxation

3

21

8

(29)   

 

 

--------

--------

--------

(Loss)/profit for the period attributable to equity shareholders

(31)

--------

84

--------

(662)

--------

Basic and diluted (loss)/profit per share

 

(3.1p)

8.4p

(66.2p)

 

 

--------

--------

--------

 

 

 

 

 

 

The results set out above derive entirely from continuing operations.

 

The above unaudited condensed consolidated income statement should be read in conjunction with the accompanying notes.

 

 

Unaudited Consolidated Statement of Comprehensive Income and Expense for the half year ended 30 June 2019

 

 

 

Half year

Half year

Year

 

 

 

ended

ended

ended

 

 

 

30/06/19

(Unaudited)

30/06/18

(Unaudited)

31/12/18

(Audited)

 

 

 

£'000

£'000

£'000

 

 

 

 

 

 

 

(Loss)/profit for the period

 

(31)

84

(662)

 

Items that will not be reclassified to profit or loss

 

 

 

 

 

Remeasurements of post-employment benefit obligations

 

(1,979)

 

1,565

 

604

 

 

Movement in deferred tax relating to retirement

benefit obligation

 

337

 

(266)

 

(103)

 

 

 

--------

--------

--------

 

Other comprehensive (expense)/income

 

(1,642)

  1,299

    501

 

 

 

 

 

 

 

 

 

--------

--------

--------

 

Total comprehensive (expense)/income recognised for the period attributable to equity shareholders    

 

 

(1,673)

 

1,383

 

(161)

 

 

 

--------

--------

--------

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

             

The above unaudited consolidated statement of comprehensive income and expense should be read in conjunction with the accompanying notes.

  

 

 

Unaudited Consolidated Balance Sheet as at 30 June 2019

 

 

 

30/06/19

(Unaudited)

30/06/18

(Unaudited)

31/12/18

(Audited)

 

 

£'000

£'000

£'000

Assets

 

 

 

 

Non-current assets

 

 

 

 

Property, plant and equipment

 

4,588

4,469

4,578

Intangible assets

 

720

754

641

Goodwill

 

1,734

2,409

1,734

Deferred tax asset

 

1,775

1,221

1,434

 

 

---------

---------

--------

 

 

8,817 

8,853 

8,387 

 

 

---------

---------

--------

Current assets

 

 

 

 

Inventories

 

2,276

1,803

1,947

Trade and other receivables

 

2,612

2,906

2,576

Cash and cash equivalents

Current tax asset

Derivative financial asset

 

1,397

-

6

1,390

-

26

1,458

-

14

 

 

---------

---------

---------

 

 

6,291 

6,125 

5,995

 

 

---------

---------

---------

 

Liabilities

 

 

 

 

Current liabilities

 

 

 

 

Trade and other payables

Bank borrowings

Operating lease obligations

 

(2,765)

(2,698)

(31)

(3,006)

(2,629)

(3)

(2,658)

(2,603)

            -

 

 

         ---------

---------

---------

 

 

(5,494)

(5,638)

(5,261)

 

 

---------

---------

---------

Net current assets

 

797

487 

734 

 

 

---------

---------

---------

Non-current liabilities

 

 

 

 

Retirement benefit obligation

Operating lease obligations

 

(10,539)

(82)

(7,153)

-

(8,438)

-

Deferred tax liabilities

 

(443)

(420)

(460)

 

 

---------

---------

---------

 

 

 

 

 

Net (liabilities)/assets

 

(1,450) 

1,767 

223 

 

 

---------

---------

---------

 

Capital and reserves

 

 

 

 

Share capital

 

250

250 

250 

Retained earnings

 

(1,700)

1,517 

(27) 

 

 

---------

---------

---------

Total equity

 

(1,450) 

1,767 

223 

 

 

---------

---------

---------

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 The above unaudited consolidated balance sheet should be read in conjunction with the accompanying notes.

 

  

 

Unaudited Consolidated Statement of Changes in Shareholders' Equity

 

 

Share Capital

£'000

Retained earnings

£'000

Translation reserve

£'000

Total equity

£'000

 

 

 

 

 

At 1 January 2018

250 

134 

384 

Total comprehensive income recognised for the period

 

 

1,383

 

 

1,383 

 

 

 

 

 

 

---------

---------

---------

---------

At 30 June 2018

250 

1,517 

1,767 

 

---------

---------

---------

---------

 

 

 

 

 

At 1 January 2019

250

(27)

-

223

Total comprehensive expense recognised for the period

 

-

 

(1,673)

 

-

 

(1,673)

 

---------

---------

---------

---------

At 30 June 2019

250

(1,700)

-

(1,450)

 

---------

---------

---------

---------

The above unaudited consolidated statement of changes in shareholders' equity should be read in conjunction with the accompanying notes.                                                                                                        

 

 

Unaudited Consolidated Statement of Cash Flows for the half year ended 30 June 2019

 

 

 

Half year

Half year

Year

 

 

ended

ended

ended

 

 

30/06/19

(Unaudited)

30/06/18

(Unaudited)

31/12/18

(Audited)

 

Note

£'000

 

£'000

 

£'000

 

Cash flows from operating activities

 

 

 

 

Cash generated from operations

4

32

499

893

UK corporation tax received

 

-

-

(60)

Interest paid

 

(23)

(26)

(45)

 

 

---------

---------

---------

Cash generated from operating activities

 

9

473 

788

 

 

---------

---------

---------

Cash flows from investing activities

 

 

 

 

Purchase of property, plant and equipment

 

(158)

(115)

(358)

Purchase of intangible assets

 

-

-

-

Proceeds from sales of property, plant and equipment                                                        

9

16

41

 

 

---------

---------

---------

Net cash outflow from investing activities

 

(149)

(99)

(317)

 

 

---------

---------

---------

Cash flows from financing activities

 

 

 

 

 

Capital element of operating/finance lease repayments

 

 

(15)

 

(35)

 

            (37)

Proceeds from/(repayment of) borrowing

 

526

(7)

(575)

(Decrease)/Increase in overdraft

 

(432)

62

603

 

 

---------

---------

---------

Net cash generated from/(used in) financing activities

 

79

20

(9)

 

 

---------

---------

---------

 

Net (decrease)/increase in cash and cash equivalents

(61)

394

462

 

 

 

 

 

Opening cash and cash equivalents

 

1,458

996

996

 

 

 

 

 

 

 

---------

---------

---------

Closing cash and cash equivalents

 

1,397

1,390

1,458

 

 

---------

---------

---------

 

The above unaudited consolidated statement of cash flows should be read in conjunction with the accompanying notes.

 

 

Notes to the Interim Report for the half year ended 30 June 2019

 

1.

Interim Financial Information

 

 

The unaudited condensed consolidated interim financial information does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. The interim financial statements, which are unaudited and have not been reviewed by the Company's auditors, have been prepared in accordance with the policies set out in the 2018 Annual Report and Accounts except that the company has adopted IFRS 16 'Leases'. The comparative figures for the year ended 31 December 2018 do not constitute full financial statements and have been abridged from the full accounts for the year ended on that date, on which the auditors gave an unqualified report, which did not contain an emphasis of matter paragraph and did not contain any statement under Section 498 of the Companies Act 2006. The 2018 accounts have been delivered to the Registrar of Companies.  The Company has chosen not to adopt IAS 34 'Interim Financial Statements'.

 

 

2.

Exceptional items

Half year

Half year

Year

 

 

ended

ended

ended

 

 

30/06/19

(Unaudited)

30/06/18

(Unaudited)

31/12/18

(Audited)

 

 

£'000

£'000

£'000

 

 

 

 

 

 

GMP Equalisation

-

-

         216

 

Asset impairment

-

-

         675

 

 

----------

---------

---------

 

 

-

----------

-

---------

891

---------

 

The asset impairment relates to the company's freehold property.

 

 

3.

Taxation

Half year

Half year

Year

 

 

ended

ended

ended

 

 

30/06/19

(Unaudited)

30/06/18

(Unaudited)

31/12/18

(Audited)

 

 

£'000

£'000

£'000

 

 

 

 

 

 

Current tax

-

10

57

 

Deferred tax

(21)

(18)

(28)

 

 

---------

---------

---------

 

 

(21)

(8)

29

 

 

---------

---------

---------

 

The effective tax rate is nil.

 

 

4.

 

 

Cash generated from operations

 

Half year

Half year

Year

 

ended

ended

ended

 

30/06/19

(Unaudited)

30/06/18

(Unaudited)

31/12/18

(Audited)

 

£'000

£'000

£'000

 

 

 

 

 

(Loss)/profit before tax

(52)

76

(633)

 

Net finance costs

145

134

262

 

Depreciation and amortisation

205

230

463

 

Asset impairment

-

-

675

 

Profit on sale of property, plant and equipment

(4)

(3)

(16)

 

Exceptional charge for GMP equalisation

-

-

216

 

(Increase)/decrease in inventories

(329)

20

(124)

 

(Increase)/Decrease in trade and other receivables

(27)

     (555)

(214)

 

Increase/(Decrease) in trade and other payables

94

597 

264

 

 

---------

---------

---------

 

Cash generated from operating activities

32

499

893

 

 

---------

---------

---------

 

 

 

 

 

 

 

 

 

 

 

5.  Availability of Interim Report

 

The Interim Report will be available on the Company's website www.slingsby.com.

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
 
END
 
 
IR SFEFMUFUSEIA
Date   Source Headline
13th Dec 20192:39 pmRNSUpdate Regarding Defined Benefit Pension Scheme
20th Aug 20197:00 amRNSSlingsby(H.C.)Plc - Half-year Report
12th Jun 201911:13 amRNSSlingsby(H.C.)Plc - Result of AGM
12th Jun 20197:00 amRNSSlingsby(H.C.)Plc - Trading Update
16th May 20197:00 amRNSSlingsby(H.C.)Plc - Posting of Annual Report and Notice of AGM

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