Solid State Regulatory News (SOLI)

27 Dec 2007 15:08

Solid State PLC27 December 2007 Solid State plc (the "Group") CHAIRMAN'S STATEMENT Unaudited Interim Results for the six months ended 30th September 2007 Results The unaudited pre-tax profit for the Group for the six months ended 30thSeptember 2007 was £160,000 (2006: £233,000) on a turnover of £5,087,000 (2006:£6,337,000). The basic earnings per share for the six months period amounted to2.0p (2006: 3.1p). Following adoption of International Financial ReportingStandards no provision for amortisation has been made in these accounts and theresults for the prior year and the prior six months and the prior balance sheetshave been restated accordingly The pre-tax profit for the six months ended 30thSeptember 2007 is stated after charging non-recurring costs of re-organisationat Paddock Wood of £58,000. Trading Review Solid State Supplies Despite a significant broadening of our product range, sales in this period grewonly fractionally as trading conditions remained difficult. During the firstquarter of this financial year we restructured our operations at Paddock Woodresulting in a non-recurring charge of £58,000. I am pleased to report thatSolid State Supplies then traded profitably in the second quarter. The outlookfor the distribution market for the second half of our fiscal year remainschallenging. However, we will continue our transition to higher value products,better suited to our market, which will place us in a stronger position when themarket improves. Steatite and Wordsworth Technology Trading for the first period was disappointing in both companies, whilst thestrategy for margin enhancement has proved to be effective. The level ofturnover in both companies is significantly affected by the timing of contractswith large customers. In the six months ended 30th September 2006 the turnoverincluded large contracts which had been secured in early 2006. In the six monthsended 30th September 2007 there were no such contracts but significant contractshave now been secured which will result in enhanced turnover in the second halfof the current accounting year. Consequently both Steatite and WordsworthTechnology look forward to a stronger second period, benefiting also from ourstrategy of own brand and new products. Summary The decline in turnover compared with the same period last year reflects thedifficult trading conditions which have affected operations at both sites.However the effects have been mitigated by continuing improvement in grossmargins in both the distribution and manufacturing sectors and following therestructuring at Solid State Supplies earlier in the year all three operatingcompanies are now trading profitably. The recent acquisition of RZ PressureInstruments Supply SARL will enhance significantly the battery division ofSteatite Limited and the group continues to look for suitable acquisitionswithin the electronics industry. Dividends A final dividend of 2p per share was paid in respect of the year ended 31stMarch 2007 meaning that the total dividend paid in respect of the year was 3pper share. The directors are pleased to announce that in the light of theresult for the first half year, an interim dividend of 0.75p per share will bepaid. The payment date will be 30th January 2008 to shareholders on theregister at the close of business on 11th January 2008. Conclusion I would like to thank my fellow directors and all the staff of the group fortheir support over the past six months. Peter HainingChairman27th December 2007 INTERIM CONSOLIDATED INCOME STATEMENT for the six months ended 30th September 2007 Unaudited Unaudited Unaudited Six months to Six months to Year to 30 September 07 30 September 06 31 March 07 £'000 £'000 £'000 Revenue 5,087 6,337 12,370Cost of sales (3,507) (4,669) (8,784) _________ _________ _________Gross profit 1,580 1,668 3,586 _________ _________ _________Distribution costs (647) (794) (1,356)Administrative expenses (722) (591) (1,563) _________ _________ _________ (1,369) (1,385) (2,919) _________ _________ _________Profit from operations 211 283 667Finance income - 1 2Finance costs (51) (51) (113) _________ _________ _________Profit before taxation 160 233 556Tax expense (36) (41) (95) _________ _________ _________PROFIT FOR THE FINANCIAL PERIOD 124 192 461 _________ _________ _________ Earnings per share (see below) Basic 2.0p 3.1p 7.4p Diluted 2.0p 3.1p 7.4p All amounts relate to continuing operations. INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY for the six months ended 30th September 2007 (unaudited) Share Capital Share premium redemption Retained capital reserve reserve earnings Total Balance at 31 March 2006 308 757 5 949 2,019Profit for six months to 30 September 2006 - - - 192 192 _____ _____ _____ _____ _____ 308 757 5 1,141 2,211Share based payment expense - - - 4 4 _____ _____ _____ _____ _____Balance at 30 September 2006 308 757 5 1,145 2,211Profit for six months to 31 March 2007 - - - 269 269 _____ _____ _____ _____ _____ 308 757 5 1,414 2,484Dividends (61) (61)Share based payment expense 4 4 _____ _____ _____ _____ _____Balance at 31 March 2007 308 757 5 1,357 2,427Profit for six months to 30 September 2007 - - - 124 124 _____ _____ _____ _____ _____ 308 757 5 1,481 2,551Dividends - - - (123) (123)Share based payment expense _ - - 4 4 _____ _____ _____ _____ _____Balance at 30th September 2007 308 757 5 1,362 2,432 _____ _____ _____ _____ _____ CONSOLIDATED BALANCE SHEET as at 30th September 2007 Unaudited Unaudited Unaudited as at as to as at 30 September 07 30 September 06 31 March 07 £'000 £'000 £'000 ASSETSNON-CURRENT ASSETSProperty, plant and equipment 302 368 343Goodwill 1,661 1,661 1,661 _________ _________ _________TOTAL NON-CURRENT ASSETS 1,963 2,029 2,004 CURRENT ASSETS _________ _________ _________ Inventories 1,249 1,188 1,249Trade and other receivables 1,530 2,341 2,365Cash and cash equivalents 67 117 85 _________ _________ _________TOTAL CURRENT ASSETS 2,846 3,646 3,699 _________ _________ _________TOTAL ASSETS 4,809 5,675 5,703 _________ _________ _________LIABILITIES CURRENT LIABILITIESBank overdraft (474) (330) (556)Trade and other payables (1,137) (1,712) (1,644)Bank borrowings (566) (925) (763)Corporation tax liabilities (95) (40) (95) _________ _________ _________TOTAL CURRENT LIABILITIES (2,272) (3,007) (3,058) _________ _________ _________NON-CURRENT LIABILITIES Bank borrowings (69) (412) (218) Corporation tax liabilities (36) (41) - _________ _________ _________TOTAL NON-CURRENT LIABILITIES (105) (453) (218) _________ _________ _________TOTAL LIABILITIES (2,377) (3,460) (3,276) _________ _________ _________TOTAL NET ASSETS 2,432 2,215 2,427 _________ _________ _________CAPITAL AND RESERVES ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANYShare capital 308 308 308Share premium reserve 757 757 757Capital redemption reserve 5 5 5Retained earnings 1,362 1,145 1,357 _________ _________ _________TOTAL EQUITY 2,432 2,215 2,427 _________ _________ _________ CONSOLIDATED CASH FLOW STATEMENT for the six months ended 30th September 2007 Unaudited Unaudited Unaudited Six months to Six months to Year to 30 September 07 30 September 06 31 March 07 £'000 £'000 £'000 OPERATING ACTIVITIESNet profit from ordinary activities before 160 233 556taxationAdjustments for: Depreciation 54 72 152 Loss on sale of non-current assets 2 6 17 Share based payment expense 4 4 8 Investment income - (1) (2) Finance costs 51 51 113 _________ _________ _________Operating profit before changes in working capital and provisions 271 365 844 Decrease/(increase) in inventories - (107) (168)Decrease/(increase) in trade and other receivables 835 (477) (543)Increase/(decrease) in trade and other payables (509) 107 44 _________ _________ _________Cash generated from operations 597 (112) 177Income taxes paid - - (40)Income taxes repaid - - 42 _________ _________ _________Cash flows from operating activities 597 (112) 179 _________ _________ _________INVESTING ACTIVITIESPurchase of property, plant and equipment (19) (114) (188)Proceeds from sale of property, plant and 6 43 50equipmentInterest received - 1 2 _________ _________ _________ (13) (70) (136) _________ _________ _________FINANCING ACTIVITIESRepayment of bank borrowings (167) (82) (262)Income discounting finance (net movement) (179) 36 (143)Interest paid (51) (51) (113)Dividends paid to equity shareholders (123) - (62) _________ _________ _________ (520) (97) (580) _________ _________ _________INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS 64 (279) (537) _________ _________ _________ NOTES TO THE INTERIM REPORT for the six months ended 30th September 2007 1. Basis of preparation of interim financial information The consolidated interim financial statements have been prepared in accordance with the recognition and measurement principals of International Financial Reporting Standards as endorsed by the European Union ("IFRS") and expected to be effective at the year end of 31st March 2008, which are mandatory for accounting periods beginning on or after 1st January 2007. Comparative information for the six months ended 30th September 2006 and 31st March 2007 has been restated on an IFRS basis. As allowed by IFRS 1, we have elected not to apply IFRS retrospectively for business combinations computed prior to 1st April 2006 and have used the carrying value of goodwill resulting from business combinations occurring before the date of transition as deemed costs, subjecting this to impairment reviews at the date of transition (1st April 2006) and at the end of each financial year thereafter. The only effect of the transition on the reported results has been the elimination of the amortisation of goodwill as a result of the prohibition of this charge imposed by IFRS 3. Consequently the goodwill on consolidation is now carried in the balance sheet at its book value at 31st March 2006 of £1,660,878, and the amortisation charge of £91,553 in the accounts for the year ended 31st March 2007 has been eliminated, as has the charge of £45,777 in the accounts for the six months ended 30th |September 2006 and the charge of £45,777 which would have been made in the accounts for the six months ended 30th September 2007. The effect has been to reduce administrative expenses and to increase net profit and retained earnings by these amounts. The interim financial statements are unaudited and do not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985. Statutory accounts for the year ended 31st March 2007, prepared in accordance with UK GAAP, have been filed with the Registrar of Companies. The Auditors' Report on these accounts was unqualified, did not include any matters to which the Auditors drew attention by way of emphasis without qualifying their report and did not contain any statements under section 237 of the Companies Act 1985. 2. The earnings per share The earnings per share figures are based on the profit on ordinary activities after taxation as stated in the unaudited profit and loss account and the weighted average number of shares in issue during each period. The weighted average number of shares in issue during the period was 6,156,511 for the six months ended 30th September 2007, 6,156,511 for the year ended 31st March 2007 and 6,156,511 for the six months ended 30th September 2006. The calculation of diluted earnings per share was based on 6,156,511 for the six months ended 30th September 2007, 6,156,511 for the year ended 31st March 2007 and 6,156,511 for the six months ended 30th September 2006. 3. Analysis and reconciliation of cash and cash equivalents Unaudited Cash Unaudited Cash Unaudited Cash Unaudited 31.03.06 Flow 30.09.06 Flow 31.03.07 Flow 30.09.07 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Cash at bank andin hand 154 (37) 117 (32) 85 (18) 67Bank overdrafts (88) (242) (330) (226) (556) 82 (474) _________ _________ _________ _________ _________ _________ _________ 66 (279) (213) (258) (471) 64 (407) _________ _________ _________ _________ _________ _________ _________ NOTES TO THE INTERIM REPORT for the six months ended 30th September 2007 (continued) 4 Dividends Dividends paid during the period from 1st April 2006 to 30th September 2007 were as follows: 30th January 2007 Interim dividend year ended 31st March 2007 1p per share 6th August 2007 Final dividend year ended 31st March 2007 2p per share The directors are intending to pay an interim dividend for the year ended 31st March 2008 in January 2008 of 0.75p per share. This dividend has not been accrued at 30th September 2007. 5. Further copies of this document are available both at the registered office of the Company and from the offices of Charles Stanley Securities, 25 Luke Street, London, EC2A 4AR Further enquiries: Gary MarshGroup Managing DirectorSolid State plc01892 836 836 Philip DaviesCharles Stanley SecuritiesNominated Adviser020 7739 8200 This information is provided by RNS The company news service from the London Stock Exchange