Thorpe Regulatory News (TFW)

F W Thorpe Plc

INTERIM RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2011

KEY POINTS:

·; Revenue increased by 12.1% to £29.9m (2010: £26.7m)  

·; Operating profits up by 18.9% to £5.4m (2010: £4.5m) 

·; Profit before exceptional item up by 21.2% to £5.7m (2010: £4.7m) 

·; Interim dividend up by 11.6% to 4.8p (2010: 4.3p)

·; Basic earnings per share before exceptional item 36.6p (2010: 30.9p) up 18.4%

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CHAIRMAN'S INTERIM STATEMENT

Your Chairman is pleased to report that, in the half year to December 2011, revenue for your company increased to £29.9m, an increase of 12% compared to the first half of last financial year which stood at £26.7m. Profitability also increased from £4.5m for the first half of the financial year 2010/11 to £5.4m this time, an increase of 19%. This represents a 10% increase when compared to the interim results of 2010/2011 prior to restatement. Investment income improved by £0.1m, due to a higher cash balance and a modest change in investment style.

The above performance allows your company to pay an interim dividend of 4.8p per share to shareholders on the register on 13 April 2012, this being an increase of 12% on last financial year's interim.

Despite hard trading conditions the driver of energy saving remains to be of great benefit in most areas of the business. Government backed finance schemes for energy saving projects such as the Salix scheme is of great benefit not only to us as energy saving product providers but also to those wishing to save energy and reduce their CO2 emissions.

The growing pace of LED light source development has required a torrent of product development within the lighting industry and I am pleased to say that your company is well technically capable in this new technology with regular introductions of LED modified and brand new LED designs.

Investment in the business continues with, amongst other things, the purchase of a 12,000 square foot factory unit on a 999 year lease to house a new venture, being TRT Lighting which will concentrate on the design and manufacture of outdoor LED lighting solutions.

Export remains a key factor in our endeavours with orders showing a 19% increase at this stage compared to last year. This forward motion has been maintained despite some slackening in mainland Europe.

The last six months has seen F W Thorpe Plc return to a pure lighting fittings and systems company with the sale of Mackwell Electronics Ltd being completed and, at this time, the Board would like to wish Mackwell every success in the future.

Without repeating sentiments about the difficulty-to-forecast future your company will continue to offer its customers honest advice, industry leading products, and the service they deserve.

Andrew Thorpe

Chairman

15 March 2012

F W Thorpe Plc

Merse Road

North Moons Moat

Redditch

Worcs.

B98 9HH

CONSOLIDATED INCOME STATEMENT

for the six months to 31 December 2011

Earnings per share for profit attributable to the equity holders of the company during the period

GROUP STATEMENT OF COMPREHENSIVE INCOME

for the six months to 31 December 2011

CONSOLIDATED BALANCE SHEET

as at 31 December 2011

GROUP STATEMENT OF CHANGES IN EQUITY

for the six months to 31 December 2011

GROUP STATEMENT OF CASH FLOWS

for the six months to 31 December 2011

Notes to the Interim Financial Statements

1. Basis of Preparation

The consolidated interim financial statements for the six months to 31 December 2011 have been prepared in accordance with the recognition and measurement principles of applicable International Financial Reporting Standards (IFRS) in issue as adopted by the European Union (EU) and International Financial Reporting Standards as issued by the International Accounting Standards Board and the Alternative Investment Market (AIM) Rules for Companies.

The figures for the period to 31 December 2011 and the comparative period to 31 December 2010 have not been audited or reviewed and are therefore disclosed as unaudited. The figures for 30 June 2011 have been extracted from the financial statements for the year to 30 June 2011, which have been delivered to the Registrar of Companies. The interim financial statements do not constitute statutory accounts within the meaning of the Companies Act 2006.

The financial statements are presented in Pounds Sterling, rounded to the nearest thousand.

The interim financial statements are prepared under the historical cost convention, modified by the revaluation of certain current and non-current investments at fair value through profit or loss.

The accounting policies set out in the financial statements for the year ended 30 June 2011 have been applied consistently throughout the Group during the period.

2. Segmental analysis

The segmental analysis is presented on the same basis as that used for internal reporting purposes. For internal reporting F W Thorpe is organised into six operating segments based on the products and customer base in the lighting market. The largest business is Thorlux which manufactures professional lighting systems for the industrial, commercial and controls market. The five remaining operating segments have been aggregated into the 'other companies' segment based on their size and comprise Compact Lighting, Philip Payne, Sugg Lighting, Solite Europe and Portland Lighting.

F W Thorpe's chief operating decision-maker (CODM) is the group board. The group board reviews the group's internal reporting in order to monitor and assess performance of the operating segments for the purpose of making decisions about resources to be allocated. Performance is evaluated based on a combination of revenue and operating profit. Assets and liabilities have not been segmented which is consistent with the group's internal reporting.

2. Segmental analysis (continued)

Inter-segment adjustments to operating profit consist of property rentals on premises owned by FW Thorpe Plc, adjustments to profit related to stocks held within the group that were supplied by another segment and adjustments to investment provisions relating to group companies.

3. Acquisition of Portland Lighting Ltd

On 1 July 2011 the group acquired 100% of the share capital of Portland Lighting Ltd for an initial amount of £2,500,000. A further amount has been paid of £204,000 and a provision has been made for a further £250,000 based on the likely profitability of Portland Lighting Ltd this year. There is also potential deferred consideration payable which is dependant upon the ongoing profitability of the company next year. The net assets acquired amount to £473,000, although the group has not finalised a fair value exercise over the acquired assets and liabilities of the company. This exercise will be completed during the financial year.

4. Disposal of Mackwell Electronics Ltd

On 2 December 2011 a resolution was passed at an Extraordinary General Meeting to approve the sale of Mackwell Electronics Ltd to Mr N A Brangwin. The consideration amounted to £6,500,000 of which £4,500,000 was in cash and £2,000,000 in loan notes. The profit on sale amounted to £1,377,000. No provision for tax has been made on the basis of substantial shareholder exemption relief. We have reduced the carrying value of the loan notes on the basis of a fair value adjustment.

5. Earnings per share

The earnings per share is calculated on profit after taxation and the weighted average number of ordinary shares in issue of 11,723,559 (2010: 11,723,559) during the period. For diluted earnings per share, the weighted average of ordinary shares in issue is adjusted to assume conversion of all dilutive potential ordinary shares. The adjusted weighted average number of ordinary shares is calculated at 11,723,559 (2010: 11,723,559) as there are no dilutive potential ordinary shares.

6. Dividend

The interim dividend is at the rate of 4.8p per share (2010: 4.3p), and based on 11,723,559 shares in issue at the announcement date the dividend will amount to £563,000 (2010: £504,000). The interim dividend will be paid on Tuesday 8 May 2012 to shareholders on the register at the close of business on 13 April 2012 and the shares become ex-dividend on 11 April 2012.

A final dividend for the year ended 30 June 2011 of 13.3p (2010: final of 12.6p) per share, amounting to £1,559,000 (£1,477,000) was paid on 17 November 2011.

7. Availability of interim statement

Copies of this report are being sent to shareholders and will also be available from the company's registered office or on the company's website from 23 March 2012.