Thorpe Regulatory News (TFW)

21 Sep 2006 07:30

Thorpe(F.W.) PLC21 September 2006 F W THORPE PLC PRELIMINARY RESULTS for the year ended 30 June 2006 FW Thorpe plc, designer and manufacturer of professional lighting equipment forthe specification market, is pleased to announce its preliminary results for theyear ended 30 June 2006. Highlights: * Turnover £44.2m (2005: £41.6m) * Profit before exceptional items of £7.3m (2005: £5.8m) 26% increase * Profit before tax of £7.4m (2005: £5.7m) * Basic earnings per share 43.8p (2005: 35.8p) 22% increase * Strong operating cash flow. * Total interim and final dividend 12p (2005: 10p) 20% increase * Special dividend 12p * Pension scheme deficit reduced to £1.3m (2005: £3.3m) * £1m investment in factory premises On prospects, Andrew Thorpe, Chairman said: "Our markets appear to be fairly stable at the present time .........eachcompany in the Group is pursuing ideas to carefully expand its productoffering......whilst particular companies pursue growth by serving new markets" For further information, please contact: Andrew Thorpe on: 01527 583200FW Thorpe plc CHAIRMAN'S STATEMENT The financial year 2006 produced a turnover of £44.2M for the Group, an increaseof 6% compared to the previous year. Operating profit for the same period, afteraccounting for exceptional costs at Sugg Lighting (note 3), rose from £5.3M in2005 to £6.9M in 2006, a 29% increase. Investment income improved by 44%, dueto higher cash reserves, to bring a resultant profit before tax of £7.4M, a 30%increase. In general, trading throughout the year was more buoyant than had been expectedwith all Group Companies turning in an improved performance over the previousyear and making further progress in their own individual market sectors. Theconcern expressed in the half yearly report in regard to the retail sector wasnot really realised as any down turns in this market area were patchy and notgenerally felt. There have been a number of new product introductions during the year fromvarious members of the Group; very important as such a high proportion of Groupsales emanates from relatively new designs. In lighting, nowadays it is notalways the fitting that is important, however, but with increasing frequency theelectronic control system behind it. Through work carried out during thisfinancial year, before it and after it your Company will soon introduce alighting system which if installed anywhere in the world can, via GPRStechnology, be monitored from anywhere else in the world. This system willprovide the possibility of an ongoing income stream from any such installation. Investment during the year continued at a moderate level as regards plant andmachinery but some human and "green" credentials emerged with the installationof a roof air venting system at the Thorlux works as well as the installation ofcardboard and general waste compacting equipment. The largest investment tookplace on the last day of the financial year in the outright purchase of a £1M+factory for Philip Payne. This factory will replace their current leasedpremises. The Company, as was mentioned in the half yearly statement, transferred thetrading of its shares to the Alternative Investment Market of the London StockExchange (AIM) on 6th January 2006 and we are pleased to report that after theinitial dip the share price has continued to make strong progress. The results detailed at the start of this report lead your Board to recommend afinal dividend of 9p (2005: 7.5p) which, taken with the interim dividend,already paid, makes a total dividend for the year of 12p (2005: 10p) being a 20%increase compared to last year. At this time it is the opinion of your Directors that cash reserves are morethan sufficient for the current needs of the business even after taking intoaccount possible requirements for organic and non-organic growth. Your Boardhas, therefore, decided to propose a special cash distribution of 12p per shareto be paid in conjunction with the final dividend making a total dividendpayment of 21p per share to be paid on 16th November 2006 (note 4). Thorlux Thorlux enjoyed another good year boosting turnover by 6% and operating profit by 17% compared to the previous year. Incremental improvements in manufacturing performance have been made by theincreased utilisation of equipment, especially £1M + Salvagnini sheet metalpunching and bending line purchased some eighteen months ago. The wider rangeof products developed by Thorlux in recent years has led to a higher level ofbusiness during the previously quieter winter months and encouraged the Companyto maintain a higher trained work force during these months. Maintenance ofthis higher level of staff has greatly assisted in the preparation for thenormally expected "bulge" in output requirement during the summer months causedby the Thorlux customer profile. The concentration of effort on the export side also seems to be paying dividendswith Thorlux, for the first time in some years, increasing the amount of exportbusiness as a percentage of total turnover from 6% in 2005 to 7% in 2006. In theyear to June 30th 2006, total export output was up 17%, European export outputwas up 11% and our two people in Munich managed an output increase of 107%. Inregard to the German Operation, growth rather than profit is the motivecurrently and Thorlux is actively trying to bolster the team by one full timeSales Representative. The return to a Thorlux employed Sales Engineer in theRepublic of Ireland is bolstering sales and the Company is looking to employ itsown representative in one further mainland European market. Far East marketscontinued to become more difficult and although Middle East sales increased,this is probably as much to do with their being awash with petro-money as to themarket becoming easier for us. Mackwell Mackwell, the Group's manufacturer of emergency lighting control gear andsystems also had another successful year increasing turnover by 7% and profit by13% compared to the previous financial year. It was mentioned last year thatMackwell's product direction was re-focused and concentration during this periodhas remained on suitably profitable medium volume production traditionalproducts whilst at the same time the company has been keeping abreast ofpossible changes in the technology of emergency lighting in general. A growingpercentage of Mackwell's turnover is now products for LED (rather thanfluorescent) emergency lighting systems. During this financial year the companyalso introduced new manufacturing equipment some of which has assisted Mackwellin its meeting the European ROSH Directive requirements to become a " lead free"product supplier. Compact Lighting Compact Lighting being a manufacturer of retail space lighting started the yearwith trepidation as to the impending fate of the retail sector. The downturn inthis area has been patchy and although some of Compact's customers curtailedtheir shop refurbishment programmes others did not and further new customerswere found amongst those still investing. Compact Lighting finished the yearwith creditable performance of an operating profit increase of 9% on reducedturnover. Philip Payne Philip Payne the manufacturer of quality specialist exit signage and specialisthospital signage returned to a year of buoyant trading unlike the somewhatpatchy previous year. Results recovered as if last year had not happened togive a record year of turnover and operating profit up by 27% and 68%respectively. The company currently occupies leased premises and so, to takeadvantage of a break in the lease, the Group has been looking for suitablepremises to purchase in its stead. Payne's has a particularly "green" workforce with numbers walking to work and it has been fortuitous that a suitablebuilding became available across the road from the current premises. Thebuilding, as was mentioned earlier, was purchased on the last day of thefinancial year and is currently being fitted out to suit Payne's requirements. The company will move to the new premises in October 2006. Sugg Lighting Heritage lighting manufacturer and refurbisher Sugg Lighting improved turnoverin the year to June 30th 2006 by 21% and this performance coupled with a furtherreduction in the work force and improved productive capacity allowed the companyto run at only a small operating loss during the period. Work continuesimproving, still further, the performance at Sugg Lighting and meanwhile theGroup's considerations as to a more stable platform for Sugg's future are movingto a conclusion. People Again, we owe a lot to our people who have been loyal and hard workingthroughout the year. We have quite a number of nationalities on our work forcecurrently which made for quite an interesting time during the 2006 World Cupfootball tournament! May I take this opportunity to thank all F W Thorpe Plc employees of allnationalities for their help and further diligence throughout the year. The Future Our markets appear to be fairly stable at the present time and although it seemsunlikely that higher Government spending will be forthcoming to fuel furthergrowth, the impending general reduction in fuel prices should assist. In themain growth must, therefore, come from our own efforts to produce more productsthat our customers want to buy and for us to be there to service thosecustomers. Each company in the Group is pursuing ideas to carefully expand itsproduct offering whilst particular companies in the business continue to pursuegrowth by serving new markets in a more direct manner. We will continue to tryand offer more customers better, and more. A B ThorpeChairman 21 September, 2006 CONSOLIDATED RESULTS (UNAUDITED) GROUP PROFIT AND LOSS ACCOUNT Year ended Year ended 30 June 06 30 June 05 Restated - Note 1 £'000 £'000 Turnover 44,204 41,572 ______ ______ Operating Profit - before exceptional items 7,272 5,760 Exceptional items (Note 3) (395) (422) ______ ______ Operating Profit 6,877 5,338 Interest receivable and other income 543 378 ______ ______ Profit on ordinary activities before taxation 7,420 5,716 Taxation on profit on ordinary activities (2,224) (1,479) ______ ______ Profit on ordinary activities after taxation 5,196 4,237 Dividends paid (1,247) (1,054) ______ ______ Retained profit for the year 3,949 3,183 ______ ______ Earnings per share - basic 43.8p 35.8p - diluted 43.5p 35.5p Dividends paid - rate per share: 10.5p 8.9p All of the above results were from continuing operations CONSOLIDATED RESULTS (UNAUDITED) GROUP STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES Year ended Year ended 30 June 06 30 June 05 Restated - Note 1 £'000 £'000 Profit for the financial year 5,196 4,063 Actuarial gain/(loss) on pension scheme 1,414 (1,991) Movement on associated deferred tax asset (424) 597 ______ ______ Total recognised gains and losses for the period 6,186 (1,394) ______ ______Prior period adjustments Pension scheme deficit (FRS 17) (3,296) Pension scheme prepayment (FRS 17) (475) Dividends proposed (FRS 21) 888 ______ Total prior year adjustments (2,883) ______ Total gains and losses recognised since the last annual report 3,303 ______ CONSOLIDATED RESULTS (UNAUDITED) GROUP BALANCE SHEET As at As at 30 June 06 30 June 05 Restated - Note 1 £'000 £'000Fixed assetsTangible assets 9,907 9,335Investments 258 258 ______ ______ 10,165 9,593Current assetsStocks 7,005 7,267Debtors 10,075 9,945Investments 70 70Cash at bank and in hand 11,848 8,414 ______ ______ 28,998 25,696Creditors:Amounts falling due within one year (6,851) (6,168) ______ ______ Net current assets 22,147 19,528 ______ ______ Total assets less current liabilities 32,312 29,121 Provisions for liabilities and chargesOnerous lease obligation (471) (200)Deferred taxation 412 (509) ______ ______ Net assets excluding pension liability 31,429 28,412 Pension liability (note 5) (1,329) (3,296) ______ ______ Net assets 30,100 25,116 ______ ______ Capital and reservesCalled up share capital 1,188 1,184Capital Redemption Reserve 135 135Share premium account 586 545Profit and loss account 28,191 23,252 ______ ______Equity shareholders' funds 30,100 25,116 ______ ______ CONSOLIDATED RESULTS (UNAUDITED) GROUP CASH FLOW STATEMENT Year ended Year ended 30 June 06 30 June 05 Restated - Note 1 £'000 £'000Net cash inflow from operating activitiesOperating profit 6,877 5,338Depreciation 1,216 1,148Profit on sale of fixed assets (31) (31)Pension Scheme excess contributions (1,450) (615)Movements in working capital 522 (1,601) ______ ______ 7,134 4,239Returns on investments and servicing of financeInterest and dividends received 597 440 Taxation - UK Corporation Tax paid (1,338) (1,758) Capital expenditure and financial investmentPurchase of tangible fixed assets (1,828) (1,170)Sale of tangible fixed assets 71 56Sale of fixed asset investments - 28 ______ ______Net cash outflow for capital expenditure (1,757) (1,086)and financial investments ______ ______ Equity dividends paid (1,247) (1,054) ______ ______ Cash inflow before financing 3,389 781 Financing - Issue of shares 45 79 ______ ______ Increase in cash in the period 3,434 860 ______ ______ Reconciliation of net cashflow to movementin net funds Increase in net cash 3,434 860Net funds at the beginning of the period 8,484 7,624 ______ ______ Net funds at the end of the period 11,918 8,484 ______ ______ Notes 1. The Accounts for the year ended 30 June 2005 have been adjusted toreflect the adoption of FRS 17 and FRS 21. 2. The earnings per share is calculated on profit on ordinary activitiesafter taxation and the weighted average number of ordinary shares in issue of11,869,244 (2005: 11,825,715) during the period. For diluted earnings per sharethe weighted average of ordinary shares in issue is adjusted to assumeconversion of all dilutive potential ordinary shares. The adjusted weightedaverage number of ordinary shares is calculated at 11,943,559 (2005:11,943,559). 3. Due to the trading difficulties experienced at Sugg Lighting Ltd,management has undertaken a review of the business. This has resulted in anexceptional stock provision of £12,000 (2005: £195,000) and an impairment of£383,000 (2005: 227,000), of which £271,000 (2005: £200,000) is treated as anonerous lease provision and the remaining impairment of £112,000 (2005: £27,000)relates to fixed assets. 4. A final dividend of 9p (2005: 7.5p) per share and a special dividend of12p (2005: nil) per share are proposed and, if approved, will be paid togetheron 16th November 2006. 2006 2005 £'000 £'000Dividends proposedFinal dividend for 2006 of 9p per share (2005: 7.5p per share) 1,069 888Special dividend for 2006 of 12p per share (2005: nil) 1,425 - 2,494 888 5. A lump sum contribution of £1,450,000 (2005: £500,000) was made to thepension scheme during the year. This payment was in addition to thecontributions recommended by the scheme actuary. 6. The unaudited preliminary information above has been prepared on thebasis of the accounting policies set out in the annual financial statements forthe year ended 30 June 2005, with the exception of the adoption of FRS 17 andFRS 21. The auditors have given an unqualified report on those statutoryaccounts. 7. The above financial information does not constitute statutory accountswithin the meaning of Section 240(5) of the Companies Act 1985. The statutoryaccounts have not been delivered to the Registrar of Companies, but will bedelivered in due course. Dates: AGM: 9 November 2006 Dividend payment date: 16 November 2006 Ex-dividend date: 11 October 2006 Record date: 13 October 2006 This information is provided by RNS The company news service from the London Stock Exchange