TCN.L Regulatory News (TCN)

26 Jun 2007 07:02

Tricorn Group PLC26 June 2007 Tricorn Group plc Preliminary Results 2006/07 Tricorn Group plc today announced its results for the year ended 31 March 2007. 2007 2006 Change £'000 £'000 % Sales 11,147 6,202 +79.7Operating Profit* 1,044 654 +59.6Operating Profit after 924 654 +41.3Rationalisation costsAdjusted earnings per share* 2.63p 2.11p +24.6 * before rationalisation, goodwill amortisation and FRS20 charges The year ended 31st March 2007 has seen record results for the Group as we moveforward with our strategy to expand both organically and by acquisition.Operating Profit (before tax, goodwill amortisation, FRS 20 charges andrestructuring costs) grew by 59.6% to £1,044k (2006: £654k). Adjusted basicearnings per share were 2.63p (2006: 2.11p) a growth of 24.6%. Malvern Tubular Components saw growth in turnover of 16% in the year through acombination of expanding within existing customers and gaining new accounts. Wecontinued to focus on improving customer overall value and further extended ourcomponent purchases from lower cost countries. Redman Fittings saw growth in turnover of 61% as the product was taken up by newcustomers in the water industry and the company made a useful contribution toGroup profits. The outlook for this product in the current year is particularlyencouraging. At RMDG Aerospace it was a year of change as we invested £120k in rationalisingthe organisation and also completely reorganised the shopfloor to improveworkflow and productivity. Productivity had improved by over 15% by the year endand our delivery performance to customers had improved to world class levels. We continued our drive to move component purchases to lower cost countries andwe expect to dramatically increase supplies from this area in the coming year. Following the restructuring programme RMDG Aerospace is expected to make asignificant contribution to Group profits in the current year. We have today announced the acquisition of Maxpower Automotive for the cashconsideration of £1.55m. Maxpower Automotive is a tube manipulating companysupplying primarily off highway and niche automotive producers. Whilst thecompany majors on steel tube manipulation similar to MTC they have alsodeveloped a market for plastic tube forming. Of particular note is a uniqueplastic/steel hybrid product they have developed which is ideal for hightemperature environments where weight is at a premium. In the year ending March 2006 Maxpower had sales of £5.3m and profit before taxof £70k. The lessons and techniques used to drive MTC performance will now beused to develop the Maxpower business. The outlook for the Group remains very positive with all our key market sectorsremaining strong and our drive for reduced cost continuing to be successful. We will continue to look for acquisition opportunities where the Tricorn Groupexpertise can add significant value. CONSOLIDATED SUMMARISED PROFIT AND LOSS ACCOUNTFor the year ended 31 March 2007 Continuing operations 2007 2006 Note Acquisition Total Total £'000 £'000 £'000 £'000 Turnover 6,812 4,335 11,147 6,202 Cost of sales (3,363) (3,424) (6,787) (3,220) Gross profit 3,449 911 4,360 2,982 Distribution costs (402) (49) (451) (261) Administrative expenses before goodwillamortisation, restructuring costs and share (2,075) (790) (2,865) (2,067)based payments Amortisation of goodwill (15) (45) (60) (15) Restructuring costs - (120) (120) - Share based payments (52) - (52) - Total administrative expenses (2,142) (955) (3,097) (2,082) Operating profit before goodwill amortisation,restructuring costs and share based payments 972 72 1,044 654 Amortisation of goodwill (15) (45) (60) (15) Restructuring costs - (120) (120) - Share based payments (52) - (52) - Operating profit/(loss) 905 (93) 812 639 Interest receivable 11 23 Interest payable and similar charges (129) (62) Profit on ordinary activities before taxation 694 600 Tax on profit on ordinary activities 2 (110) 38 Retained profit on ordinary activities after taxation 4 584 638 Earnings per ordinary share - basic 3 1.88p 2.06p - diluted 1.72p 2.05pAdjusted earnings per ordinary share - basic 3 2.63p 2.11p - diluted 2.41p 2.09p There were no recognised gains or losses other than the profit for the financial year. All of the activities of the group are classed as continuing. CONSOLIDATED SUMMARISED BALANCE SHEET AT 31 MARCH 2007 Note 2007 2006 £'000 £'000Fixed assetsIntangible assets 537 60Tangible assets 839 543 1,376 603 Current assetsStocks 2,359 578Debtors 3,446 1,464Cash in bank and in hand 35 999 5,840 3,041 Creditors:Amounts falling due within one year (4,339) (1,384) Net current assets 1,501 1,657 Total assets less current liabilities 2,877 2,260 Creditors:Amounts falling due after more than one year (70) (75) Provisions for liabilities and charges (41) (55) 2,766 2,130 Capital and reservesCalled up share capital 3,102 3,102Share premium account 1,371 1,371Other reserve 52 -Merger reserve 1,388 1,388Profit and loss account (3,147) (3,731)Equity shareholders' funds 4 2,766 2,130 CONSOLIDATED SUMMARISED CASH FLOW STATEMENTFor the year ended 31 March 2007 Note 2007 2006 £'000 £'000 Net cash inflow from operating activities 5 509 936 Returns on investments and servicing of financeInterest received 11 23Interest paid (119) (47)Finance lease and hire purchase interest paid (10) (15) Net cash outflow from returns on investments and servicingof finance (118) (39) Taxation (11) 41 Capital expenditure and financial investmentPayments to acquire tangible fixed assets (254) (30)Receipts from sale of tangible fixed assets 32 11 Net cash outflow from capital expenditure and financialinvestment (222) (19) Acquisitions and disposalsPurchase of business 7 (2,016) - Net overdrafts acquired (485) - Net cash outflow from acquisitions and disposals (2,501) - Net cash (outflow)/inflow before financing (2,343) 919 Management of liquid resourcesFunds withdrawn/(deposited) on treasury reserve 915 (915) FinancingIssue of ordinary share capital - 2Capital element of finance lease rentals Net cash outflow from financing (10) (70) (10) (68) Decrease in cash 6 (1,438) (64) NOTES TO THE PRELIMINARY ANNOUNCEMENTFor the year ended 31 March 2007 1. Basis of Preparation The preliminary announcement has been prepared under the historical costconvention, on bases consistent with the previous year, and in accordance withapplicable accounting standards. The principal accounting policies of the Group are set out in the Group's 2007 annualreport and financial statements. In preparing the financial statements for the current year, the Group hasadopted the following Financial Reporting Standard: FRS 20 'Share-based payment' - whereby all share-based payment arrangementsgranted after 7 November 2002 that had not vested prior to 1 April 2006 arerecognised in the financial statements. 2. Taxation charge/(credit) on profit/(loss) on ordinary activities 2007 2006 £'000 £'000 Current corporation tax 136 22Adjustment in respect of prior year - research and development tax credit (12) (41)Total current tax 124 (19)Deferred taxation (14) (19) 110 (38) Unrealised tax losses of approximately £254,000 (2006: £596,000)remain available to offset against future taxable trading profits. 3. Earnings per share The calculation of the basic earnings per share is based on the profit on ordinary activities after taxand on the weighted average number of ordinary shares in issue during the year. The profits and weighted average number of shares used in the calculations are set out below: 2007 2006 Profit Weighted average Earnings per Profit Weighted Earnings number of shares share average per share number of shares £'000 000's pence £'000 000's penceBasic earnings per share 584 31,020 1.88 638 31,001 2.06 Dilutive shares - 2,885 - - 187 - Diluted earnings per 584 33,905 1.72 638 31,188 2.05share The share options in issue in 2007 and 2006 are dilutive. The 300,000 share options granted in January 2002are anti-dilutive due to the exercise price being in excess of the average market price during the year. The Directors consider that the following adjusted earnings per share calculation is a more appropriatereflection of the group performance. 2007 2006 Profit Weighted average Earnings per Profit Weighted Earnings number of shares share average per share number of shares £'000 000's pence £'000 000's penceBasic earnings per share 584 31,020 1.88 638 31,001 2.06Amortisation of goodwill 60 - - 15 - -Restructuring costs 120 - - - - -Share based payments 52 - - - - -Diluted earnings per 816 31,020 2.63 653 31,001 2.11share Dilutive shares - 2,885 - - 187 - Diluted earnings per 816 33,905 2.41 653 31,188 2.09share 4. Reconciliation of movements in shareholders' funds 2007 2006 £'000 £'000 Profit for the year 584 638Issue of shares - 2 Movement in share based payment reserve 52 -Net increase in shareholders' funds 636 640 Shareholders' funds at 31 March 2006 2,130 1,490 Shareholders' funds at 31 March 2007 2,766 2,130 5. Reconciliation of operating profit to net cash inflow from operating activities 2007 2006 £'000 £'000 Operating profit 812 639 Depreciation 207 195Amortisation 60 15 (Profit)/loss on sale of tangible fixed assets (17) 2Movement on share based payments 52 - (Increase)/decrease in stocks (553) 143(Increase)/decrease in debtors (134) 89Increase/(decrease) increditors 82 (147)Net cash inflow from operating activities 509 936 6. Reconciliation of net cash flow to movement in net debt 2007 2006 £'000 £'000 Decrease in cash (1,438) (64) Cash used to repay capitalelement of finance lease and hire purchase agreements 10 70 (Decrease)/increase in liquid funds (915) 915 (2,343) 921New finance leases and hire purchase contracts - (35) Movement in net debt (2,343) 886Net funds/(debt) at 1 April2006 510 (376)Net (debt)/funds at 31 March 2007 (1,833) 510 7. Acquisitions On 12 June 2006 the Group acquired 100% of the issued share capital of Robert Morton DG Limited(formerly Robert Morton Holdings Limited) for a consideration of £1.929m. The following table sets out the book values of the identifiableassets and liabilities and their fair value to the group. Fair value Fair value Book value adjustments to group £'000 £'000 £'000 Fixed assets 388 (124) 264 Stocks 1,474 (246) 1,228Debtors 1,848 - 1,848Bank 77 - 77 Invoice discounting facility (562) _ (562)Creditors (1,310) (66) (1,376)Net increase in shareholders' funds 1,915 (436) 1,479 Goodwill 537 2,016 Satisfied by:Cash consideration 1,929Costs incurred 87 2,016 The fair value adjustments relate to fixed assets which were surplus to requirements and thereforeimpaired, and also bringing stocks and creditors in line with group policies and writing off surplusstock. Prior to the acquisition of Tecalemit Aerospace Limited (subsequently renamed RMDG AerospaceLimited) the profit/(loss) of the previous accounting periods are stated below: Period ended Year ended 31 31 May 2006 December 2005 £'000 £'000 Turnover 2,394 4,688 Cost of sales 2,675 4,676 Operating (loss)/profit (281) 12 Net interest (4) (8) (Loss)/profit on ordinary activities before taxation (285) 4 Taxation - - (Loss)/profit on ordinary activities after taxation (285) 4 8. 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 Act 1985. The summarised balance sheet at 31 March 2007, and the summarised profit and loss account,summarised cash flow statement and associated notes for the year then ended have beenextracted from the Group's statutory financial statements upon which the auditors opinion isunqualified and does not include any statement under Section 237 of the Companies Act 1985. Contact:Steven Cooper+44 (0) 1684 569956www.tricorn.uk.com This information is provided by RNS The company news service from the London Stock Exchange