Thorpe Regulatory News (TFW)

F W Thorpe Plc

INTERIM RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2015

F W Thorpe Plc, designers, manufacturers and suppliers of professional lighting systems for the specification market is pleased to announce its interim results for the six months ended 31 December 2015.

Key points:

· Revenue and operating profit boosted by Lightronics acquisition

· Lightronics performed ahead of expectations in first six months, driven by one off projects

· TRT Lighting profitable growth continues

· Investment of €1.2m for 40% of Luxintec S.L., a luminaire and specialist lenses manufacturer based in Spain, was completed post period end on 9 March 2016

· Interim dividend increased to 1.20p (Interim 2015: 1.10p)

· Special dividend of 2.00p (Interim 2015: nil)

For further information please contact:

CHAIRMAN'S INTERIM STATEMENT

Pleasingly results for the half year to 31 December 2015 proved rewarding with Group revenues up 27% and operating profit up 18% from continuing operations. On a like-for-like basis, excluding Lightronics (which we acquired in April 2015), revenues and operating profits increased by 5.2% and 5.1% respectively. Including the effects of investment income and taxation, earnings per share rose by 14%.

Generally whilst underlying growth throughout most of the Group subsidiaries can be described as solid rather than astounding, good progress has been made in most quarters.

Global economies still show shakiness and whilst we are not present in many, the general malaise does not endow any of our markets with booming economies and high demand.

In our overseas markets business is, therefore, currently hard fought, your company having to persuade new customers, often with different cultures, of the benefits of using our product offering of high quality, highly sophisticated lighting systems and excellent before and after sales service.

The Thorlux offices in Dusseldorf, Germany and Dublin, Ireland are continuing to make forward strides, however, the Thorlux office in Brisbane, Australia and the Group office in the UAE are still not performing as required.

The approach of opening new Group offices abroad takes time and whilst more maturity is sought on those fronts we have widened our approach, as reported in my last statement, with the purchase of Lightronics BV the successful Netherlands based lighting company.

In the same vein I can now report that your company has just approved a €1.2m investment in a 40% shareholding in Luxintec S.L., a €3.5m revenue Spanish manufacturer of precision LED lighting lenses and a limited range of luminaires, the latter being a market in which they wish to expand.

Both the investments in Lightronics and Luxintec allow a wide scope for the interchange of products in both directions but most probably allowing a wider platform for most Group companies to participate in the Netherlands and Spanish speaking markets of which there are many.

The first half of the 2015/16 year has been driven by exceptional performance of Lightronics BV and marked further progress at TRT Lighting our road tunnel and street lighting systems manufacturer. Your Group continues to strive for growth and the Board is cautiously optimistic about the rest of the financial year.

Group results outlined above allow your company to pay a dividend for the half year to 31 December 2015 of 1.20p per share (Interim 2015: 1.10p), an increase of 9%. Further, at this time and in consideration of adequate Group reserves, a special dividend of 2.00p per share (Interim 2015: nil) will be paid at the same time as the interim dividend.

Andrew Thorpe

Chairman

21 March 2016

F W Thorpe Plc

CONSOLIDATED INCOME STATEMENT

for the six months to 31 December 2015

*Finance expense represents payments made in relation to the acquisition of Lightronics Participaties BV.

GROUP STATEMENT OF COMPREHENSIVE INCOME

for the six months to 31 December 2015

All comprehensive income is attributable to the owners of the company.

* The loss on items that may be reclassified to profit or loss of £207,000 is due to the decrease in market value of available for sale financial assets.

CONSOLIDATED BALANCE SHEET

as at 31 December 2015

GROUP STATEMENT OF CHANGES IN EQUITY

for the six months to 31 December 2015

GROUP STATEMENT OF CASH FLOWS

for the six months to 31 December 2015

Notes to the Interim Financial Statements

1. Basis of Preparation

The consolidated interim financial statements for the six months to 31 December 2015 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 AIM Rules for Companies.

The figures for the period to 31 December 2015 and the comparative period to 31 December 2014 have not been audited or reviewed and are therefore disclosed as unaudited. The figures for 30 June 2015 have been extracted from the financial statements for the year to 30 June 2015, 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 2015 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 eight 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 recently acquired Lightronics business is the next largest business. The six remaining continuing operating segments have been aggregated into the 'other companies' segment based on their size and comprise Compact Lighting Limited, Philip Payne Limited, Solite Europe Limited, Portland Lighting Limited, TRT Lighting Limited and Thorlux LLC.

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 the 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. Post Balance Sheet Event - Investment in Associate

On 9 March 2016, subsequent to the period end, the Group invested €1,200,000 for a 40% shareholding in a luminaire and specialist lens manufacturer based in Spain, Luxintec S.L. This investment provides a platform to sell the Group's products in Spain and secures a part of the supply chain for the Group in the future. In 2015 Luxintec's annual revenues were €3.5m with operating profit of €0.3m.

The Group intends to apply the equity method of accounting to recognise this interest.

4. Income tax expense

For the period ending 30 June 2015, the effective tax rate for the Group was 18.7% however the effective tax rate applied for the period ended 31 December 2015 has increased to 21.8%. The main reasons for this increase are:

· The Group is no longer being classified as a Small or Medium sized Enterprise resulting in a lower rate of tax relief for research and development expenses;

· An increasing share of the Group's profits are being generated in the Netherlands where the main corporate tax rate is 25%; and

· No adjustment in 31 December 2015 for prior year tax credit.

5. Earnings per share

The basic earnings per share is calculated on profit after taxation and the weighted average number of ordinary shares in issue of 115,675,590 (Interim 2015: 115,675,590) during the period. The diluted earnings per share is calculated on profit after taxation and the weighted average number of potentially dilutive ordinary shares in issue of 115,791,614 (Interim 2015: 116,313,090) during the period.

6. Dividend

The interim dividend is at the rate of 1.20p per share (Interim 2015: 1.10p), and based on 115,675,590 shares in issue at the announcement date the dividend will amount to £1,388,000 (Interim 2015: £1,272,000). A special dividend of 2.00p per share (Interim 2015: nil) will also be declared and based on 115,675,590 shares in issue at the announcement date the dividend will amount to £2,314,000 (Interim 2015: £nil). The interim and special dividends will be paid on 5 April 2016 to shareholders on the register at the close of business on 29 March 2016, and the shares become ex-dividend on 24 March 2016.

The company has obtained dispensation from the Stock Exchange to pay the dividends within a reduced timetable due to the Easter bank holidays and operational commitments preventing the earlier announcement of these results. This enables the dividend to be paid in a similar timeframe to the previous year.

A final dividend for the year ended 30 June 2015 of 2.55p (2014: final of 2.20p) per share, amounting to £2,950,000 (2014: £2,545,000) was paid on 19 November 2015.

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 (www.fwthorpe.co.uk) from 7 April 2016.