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Interim Results

19 May 2015 07:00

RNS Number : 5646N
Zytronic PLC
19 May 2015
 



For Immediate Release

19 May 2015

 

 

 

Zytronic plc

("Zytronic" or the "Group")

Interim Results for the six months ended 31 March 2015

 

Zytronic plc, a leading specialist manufacturer of touch sensors, announces its consolidated interim results for the six months ended 31 March 2015.

 

 

Overview

· Revenue increased to £10.0m (2014: £8.8m)

· Touch revenues account for 80% of total (2014: 77%)

· Gross profit margin improved to 39.9% (2014: 33.9%)

· Profit before tax increased by 15% to £1.6m (2014: £1.4m)

· Earnings per share ("EPS") increased to 8.7p (2014: 7.7p)

· Interim dividend increased by 10% to 3.14p per share (2014 interim dividend: 2.85p)

· Net cash increased to £7.3m (30 September 2014: £6.3m)

 

 

Commenting on the results, Chairman, Tudor Davies said:

"We are continuing to benefit from an improvement in current trading and on this basis expect to make further progress for the remainder of this year."

 

 

Enquiries:

Zytronic plc

Mark Cambridge, Chief Executive

Claire Smith, Group Finance Director

 

(Today: 020 7466 5000; thereafter 0191 414 5511)

Buchanan

Richard Darby, Gabriella Clinkard, Stephanie Watson

 

020 7466 5000

N+1 Singer

Aubrey Powell, Thomas Smale

 

020 7496 3000

 

 

Notes to Editors

 

Zytronic is the developer and manufacturer of a unique range of internationally award-winning touch sensor products.

 

These products employ an embedded sensing element and are based around projected capacitive technology ("PCT™") sensing. PCT offers significant durability, environmental stability and optical enhancement benefits to system designers of touch interactive, industrial, self-service and public access equipment.

 

During 2012, Zytronic developed new know-how to create mutual projected capacitive technology ("MPCT™") which enables multi-user and multi-touch touch sensing in ultra-large form factor sizes up to 84".

 

Operating from three modern factories near Newcastle-upon-Tyne in the United Kingdom, Zytronic assembles touch sensors using special glass and plastic materials, in environmentally controlled clean rooms.

Chairman's statement

 

Introduction

We are pleased to announce that the period has seen an increase in demand for our proprietary touchscreen products and a continuing improvement in revenues, margins and profits for the half year ended 31 March 2015.

Results

Revenues increased by 13% to £10.0m (2014: £8.8m), operating profit increased by 15% to £1.6m (2014: £1.4m), profit before tax increased by 15% to £1.6m (2014: £1.4m) and after tax of 18% (2014: 18%) resulted in profit after tax of £1.3m (2014: £1.2m). Earnings per share increased by 13% to 8.7p (2014: 7.7p).

The production efficiencies, and recent capital expenditure projects from last year, together with the increased revenues, and focus on products with our proprietary technology such as the larger format and multi-touch sensors, combined to increase gross margins to 40% (2014: 34%). However, the improvement in gross margins was, in part, offset by an increase in administration overheads, of which £0.4m (2014: £0.1m gain) arose from adverse currency movements as the US dollar exchange rate reduced to $1.5 from our hedged positions between $1.6 and $1.7.

We have continued to see increased market penetration and growth in our largest market sectors of financial (ATM machines) and vending, as well as exploit the potential for our newer multi-touch and larger format touchscreens in other niche markets which require rugged, toughened glass solutions. In particular, our showcase of the new touchscreens incorporated into table and gaming machines for the leisure markets at the most recent gaming expos in the USA and UK have resulted in considerable interest.

Cash Generation

The Group continued to generate cash with a net £2.1m being earned before the payment of £1.1m in respect of the final dividend for last year.

The Group's net cash position at 31 March 2015 was £7.3m (30 September 2014: £6.3m) after a liability of £1.4m in relation to a property mortgage.

Dividend

The Directors have declared a 10% increase to the dividend of 3.14p per share (2014: 2.85p) payable on 24 July 2015 to shareholders on the register on 10 July 2015.

Outlook

We are continuing to benefit from an improvement in current trading and on this basis expect to make further progress for the remainder of this year.

 

 

Tudor Davies B.Sc.

Chairman

19 May 2015

 

 

 

 

 

 

 

 

 

 

Consolidated statement of comprehensive income

Unaudited results for the six months to 31 March 2015

 

 

 

 

 

Six months to

Six months to

Year to

 

 

31 March

31 March

30 September

 

 

2015

2014

2014

 

 

Unaudited

Unaudited

Audited

 

Notes

£'000

£'000

£'000

Group revenue

10,004

8,828

18,886

Cost of sales

(6,015)

(5,839)

(11,979)

Gross profit

3,989

2,989

6,907

Distribution costs

(115)

(72)

(156)

Administration expenses

(2,246)

(1,500)

(3,488)

Group operating profit

1,628

1,417

3,263

Finance costs

(15)

(18)

(35)

Finance revenue

11

12

33

Profit before tax

1,624

1,411

3,261

Tax expense

3

(290)

(254)

(301)

Profit for the period

1,334

1,157

2,960

Earnings per share

Basic

4

8.7p

7.7p

19.6p

Diluted

4

8.6p

7.6p

19.5p

All profits are from continuing operations

 

 

 

Consolidated statement of changes in equity

Unaudited results for the six months to 31 March 2015

 

Called up

share

Share

Retained

capital

premium

earnings

Total

£'000

£'000

£'000

£'000

At 30 September 2014

152

7,290

10,611

18,053

Profit for the period

-

-

1,334

1,334

Exercise of share options

1

140

-

141

Share-based payments

-

-

88

88

Dividends

-

-

(1,093)

(1,093)

At 30 March 2015 (unaudited)

153

7,430

10,940

18,523

 

 

 

Consolidated balance sheet

Unaudited results at 31 March 2015

 

At

At

At

31 March

31 March

30 September

2015

2014

2014

Unaudited

Unaudited

Audited

Notes

£'000

£'000

£'000

Assets

Non-current assets

Intangible assets

1,415

1,455

1,413

Property, plant and equipment

7,677

7,616

7,443

9,092

9,071

8,856

Current assets

Inventories

3,085

3,342

3,126

Trade and other receivables

3,076

2,671

3,068

Other current financial assets

110

-

48

Cash and short term deposits

8,730

6,270

7,806

15,001

12,283

14,048

Total assets

24,093

21,354

22,904

Liabilities

Current liabilities

Trade and other payables

1,656

1,325

1,057

Financial liabilities

200

200

200

Other current financial liabilities

519

-

224

Accruals

959

1,058

1,264

Taxation liabilities

232

241

30

3,566

2,824

2,775

Non-current liabilities

Financial liabilities

1,243

1,439

1,341

Provisions

5

102

-

139

Government grants

63

-

-

Deferred tax liabilities (net)

596

626

596

2,004

2,065

2,076

Total liabilities

5,570

4,889

4,851

Net assets

18,523

16,465

18,053

Equity

Equity share capital

153

151

152

Share premium

7,430

7,144

7,290

Revenue reserve

10,940

9,170

10,611

Total equity

18,523

16,465

18,053

 

Consolidated cashflow statement

Unaudited results for the six months to 31 March 2015

 

 

Six months to

Six months to

Year to

31 March

31 March

30 September

2015

2014

2014

Unaudited

Unaudited

Audited

Notes

£'000

£'000

£'000

Operating activities

Profit from continuing operations

1,624

1,411

3,261

Net finance costs

4

6

2

Depreciation and impairment of property, plant and equipment

362

345

672

Amortisation and impairment of intangible assets

166

161

362

Loss on disposals of intangible assets

-

18

-

Share-based payments

88

23

93

Fair value movement on foreign exchange forward contracts

233

-

176

Working capital adjustments

Decrease in inventories

41

167

383

Increase in trade and other receivables

(8)

(242)

(638)

Increase in trade and other payables and provisions

163

251

370

Cash generated from operations

2,673

2,140

4,681

Taxation paid

(89)

(206)

(497)

Net cashflow from operating activities

2,584

1,934

4,184

Investing activities

Interest received

11

12

33

Proceeds from disposal of property, plant and equipment

-

-

36

Receipt of government grant

63

-

-

Payments to acquire property, plant and equipment

(499)

(35)

(263)

Payments to acquire intangible assets

(168)

(181)

(322)

Net cashflow from investing activities

(593)

(204)

(516)

Financing activities

Interest paid

(15)

(18)

(35)

Dividends paid to equity shareholders of the parent

(1,093)

(958)

(1,390)

Proceeds from share issues re. options

141

142

289

Repayment of borrowings

(100)

(100)

(200)

Net cash outflow from financing activities

(1,067)

(934)

(1,336)

Increase in cash and cash equivalents

924

796

2,332

Cash and cash equivalents at the beginning of the period

7,806

5,474

5,474

Cash and cash equivalents at the period end

7

8,730

6,270

7,806

 

Notes to the interim report

Unaudited results for the six months to 31 March 2015

 

 

1. Basis of preparation

The financial information in these interim statements is prepared under the historical cost convention and in accordance with international accounting standards. It does not constitute statutory accounts as defined in Section 435 of the Companies Act 2006 and does not reflect all the information contained in the Group's annual report and financial statements.

The taxation charge is calculated by applying the Directors' best estimate of the annual tax rate to the profit for the period. Other expenses are accrued in accordance with the same principles used in the preparation of the annual report and financial statements.

The interim results for the six months to 31 March 2015 are not reviewed by Ernst & Young LLP and accordingly no opinion has been given.

The interim financial statements have been prepared using the same accounting policies and methods of computation used to prepare the 2014 annual report and financial statements.

The financial information for the six months to 31 March 2015 and the comparative financial information for the six months to 31 March 2014 have not been audited. The comparative financial information for the year ended 30 September 2014 has been extracted from the 2014 annual report and financial statements.

The annual report and financial statements for the year ended 30 September 2014, which were approved by the Board of Directors on 8 December 2014, received an unqualified audit report, did not contain a statement under Section 498(2) or (3) of the Companies Act 2006 and have been filed with the Registrar of Companies.

The Group has one reportable business segment comprising the development and manufacture of customised optical products to enhance electronic display performance. Products in this reportable business segment include touch sensors, filters and other laminated products. All revenue, profits or losses before tax and net assets are attributable to this reportable business segment.

2. Basis of consolidation

The Group results consolidate the accounts of Zytronic plc and all its subsidiary undertakings drawn up to 31 March 2015.

3. Tax charge on profit on ordinary activities

The estimated tax rate for the year of 18% has been applied to the half year's profit before tax, in accordance with the ASB's statement on interim reports.

4. Earnings per share

Basic EPS is calculated by dividing the profit attributable to ordinary equity holders of the Company by the weighted average number of ordinary shares in issue during the period. All activities are continuing operations and therefore there is no difference between EPS arising from total operations and EPS arising from continuing operations.

For the six months to 31 March 2015 and 2014

 

Weighted

Weighted

average

average

number

number

Earnings

of shares

EPS

Earnings

of shares

EPS

31 March

31 March

31 March

31 March

31 March

31 March

2015

2015

2015

2014

2014

2014

£'000

Thousands

Pence

£'000

Thousands

Pence

Profit on ordinary activities after taxation

1,334

15,221

8.7

1,157

15,112

7.7

Basic EPS

1,334

15,221

8.7

1,157

15,112

7.7

 

 

The weighted average number of shares for diluted EPS is calculated by including the weighted average number of shares under option:

Weighted

Weighted

average

average

number

number

Earnings

of shares

EPS

Earnings

of shares

EPS

31 March

31 March

31 March

31 March

31 March

31 March

2015

2015

2015

2014

2014

2014

£'000

Thousands

Pence

£'000

Thousands

Pence

Profit on ordinary activities after taxation

1,334

15,221

8.7

1,157

15,112

7.7

Weighted average number of shares under option

-

235

(0.1)

-

50

(0.1)

Diluted EPS

1,334

15,456

8.6

1,157

15,162

7.6

 

 

 

 

For the year to 30 September 2014

Weighted

average

number

Earnings

of shares

EPS

30 September

30 September

30 September

2014

2014

2014

£'000

Thousands

Pence

Profit on ordinary activities after taxation

2,960

15,098

19.6

Basic EPS

2,960

15,098

19.6

 

The weighted average number of shares for diluted EPS is calculated by including the weighted average number of shares under option:

Weighted

average

number

Earnings

of shares

EPS

30 September

30 September

30 September

2014

2014

2014

£'000

Thousands

Pence

Profit on ordinary activities after taxation

2,960

15,098

19.6

Weighted average number of shares under option

-

95

(0.1)

Diluted EPS

2,960

15,193

19.5

 

5. Provisions

Holiday

Long term

pay

incentive

Total

£'000

£'000

£'000

At 1 October 2014

71

68

139

Arising during the year

-

34

34

Released during the year

(71)

-

(71)

At 31 March 2015

-

102

102

Non-current

-

102

102

 

Holiday pay

The holiday pay provision relates to the estimated exposure to additional costs in relation to the inclusion of overtime in holiday payments as a result of recent rulings on the interpretation of the EU Working Time Directive. The provision has since been released following the business decision to include overtime in holiday payments, which has therefore put any potential claim out of time.

 

Long term incentive

The provision for the long term incentive scheme relating to the Chief Executive, Group Finance Director and other management personnel is calculated based on future expectations that the bonus will be payable. Management has assessed the criteria that determines the payout and has taken a view that a proportion of the bonus should be provided for in the year ended 30 September 2014 and the half year ended 31 March 2015.

 

6. Dividends

The Directors propose the payment of an interim dividend of 3.14p per share (2014 interim dividend: 2.85p), payable on 24 July 2015 to shareholders on the register on 10 July 2015. This dividend has not been accrued in these interim accounts. The dividend payment will be approximately £479,000.

Six months to

Six months to

Year to

31 March

31 March

30 September

2015

2014

2014

Unaudited

Unaudited

Audited

£'000

£'000

£'000

Ordinary dividends on equity shares

Final dividend of 6.35p per ordinary share paid on 14 March 2014

-

958

958

Interim dividend of 2.85p per ordinary share paid on 25 July 2014

-

432

432

Final dividend of 7.16p per ordinary share paid on 13 March 2015

1,093

-

-

1,093

1,390

1,390

 

7. Cash and cash equivalents

Six months to

Six months to

Year to

31 March

31 March

30 September

2015

2014

2014

Unaudited

Unaudited

Audited

£'000

£'000

£'000

Cash at bank and in hand

8,730

6,270

7,806

 

 

 

 

For the purpose of the consolidated cashflow statement, cash and cash equivalents comprise the following:

 

Six months to

Six months to

Year to

31 March

31 March

30 September

2015

2014

2014

Unaudited

Unaudited

Audited

£'000

£'000

£'000

Cash at bank and in hand

7,588

4,922

6,950

Short term deposits

2,570

2,545

2,560

Bank overdraft

(1,428)

(1,197)

(1,704)

8,730

6,270

7,806

 

Cash at bank earns interest at floating rates based on daily bank deposit rates. Short term deposits are made for variable lengths, being overnight, three months or one year (with break conditions), depending on the immediate cash requirements of the Group, and earn interest at variable rates.

 

At 31 March 2015 the Group had available a net £1.0m (cash less overdrawn accounts) overdraft facility from Barclays Bank plc which will fall for review in January 2016.

 

The fair value of cash and cash equivalents is £8.7m (31 March 2014: £6.3m).

 

7. Availability of the Interim Report

A copy of the interim report is available on the Company's website www.zytronicplc.com and can be obtained from the Company's registered office: Whiteley Road, Blaydon-on-Tyne, Tyne & Wear, NE21 5NJ. Copies will be sent to shareholders shortly.

 

 

 

 

This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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