Final Results
Embargoed: not to be released until 7 a.m. on 16th June 2005
RDF Group plc (formerly Eurolink Managed Services plc)
('RDF' or the 'Group')
Preliminary Results
for the year ended 31st March 2005
Chairman's Statement
Results & Dividends
I am pleased to report the results for the year ended 31st March 2005. Turnover
for the period was £9.39 million (2004: £7.36 million) resulting in a profit
before tax of £515,000 (2004: loss of £196,000). Earnings per share for the
period are 3.12 pence (2004: loss per share of 1.36 pence). Your
Board is recommending the payment of a final dividend of 0.5 pence per share,
payable on 1st August 2005, to those shareholders on the register at close of
business on 1st July 2005, making a total payment of 1 pence per share for the
year (2004 - Nil). The Annual General Meeting will be held on Thursday 28th
July 2005 at 11.00 a.m. at the Group's new headquarters, 2 Bartholomews,
Brighton.
Business Review
Your Directors are pleased to report strong growth in new business throughout
the year, with the addition of several new contracts with significant clients
in March 2005. These new contracts are now fully operational and are already
reporting steady profits. The Group also continued to receive good levels of
business from its existing major clients throughout the year.
As stated last year, the long term contract negotiated with one of our major
clients, and longer term commitments from other clients, has enabled the Group
to optimise staffing levels and reduce overheads. This has resulted in both
increased gross profit and strong net profit growth.
As a result of the new client contracts, higher turnover and margin growth, we
have been able to increase our sales team both in Brighton and in Livingston,
giving the Group a good platform for sustained growth in the coming year.
Earlier this month, the Group sought and received approval from its
shareholders to rename the company RDF Group plc. The Group has also recently
relocated to new premises to provide additional space for increased demand for
our project services in Brighton.
Current Trading
The Group is looking forward to a steady increase in demand for its services in
the coming year, both through increased sales to existing clients and through
contracts with new clients. We will continue to focus on a number of sales and
marketing initiatives to ensure that levels of business across the Group will
be expanded in the coming year. In particular, the Group will seek to maximise
the opportunities to sell its core services to the new clients gained at the
end of the last Financial Year.
I should like to take this opportunity to thank all staff throughout the Group
for their significant contribution towards the profit turnaround and my Board
colleagues and advisors for their support during the year.
Subject to unforeseen circumstances, your Board is confident of further
business growth this year.
George Kynoch
Chairman
Consolidated Profit and Loss Account
for the year ended 31st March 2005
Notes 2005 2004
£'000 £'000
GROUP TURNOVER 9,390 7,365
Cost of sales (7,126) (5,833)
Gross Profit 2,264 1,532
Administrative expenses (1,729) (1,694)
OPERATING PROFIT/(LOSS) 535 (162)
Interest receivable 1 -
536 (162)
Interest payable and similar charges (21) (34)
PROFIT/(LOSS) ON ORDINARY ACTIVITIES 515 (196)
BEFORE TAXATION
Taxation 2 (191) (54)
PROFIT/(LOSS) ON ORDINARY ACTIVITIES AFTER 324 (142)
TAXATION
Dividends (104) -
RETAINED PROFIT/(LOSS) FOR THE FINANCIAL 220 (142)
YEAR
Earnings/(loss) per share (pence) 3 3.12 (1.36)
The operating profit/loss for the year arises from the group's continuing
operations. No separate Statement of Total Recognised Gains and Losses has been
presented as all such gains and losses have been dealt with in the Profit and
Loss Account.
Consolidated Balance Sheet
as at 31st March 2005
2005 2004
£'000 £'000
FIXED ASSETS
Tangible assets 167 208
CURRENT ASSETS
Debtors 2,846 1,717
Cash at bank 51 -
2,897 1,717
CREDITORS
Amounts falling due within one year (1,959) (1,032)
NET CURRENT ASSETS 938 685
TOTAL ASSETS LESS CURRENT LIABILITIES 1,105 893
PROVISIONS FOR LIABILITIES AND CHARGES
Deferred taxation (11) (19)
1,094 874
CAPITAL AND RESERVES
Called up equity share capital 208 208
Share premium account 103 103
Profit and loss account 783 563
SHAREHOLDERS' FUNDS 1,094 874
Consolidated Cash Flow Statement
for the year ended 31st March 2005
2005 As
restated
£'000 2004
£'000
Net cash flow from operating activities 334 160
Returns on investments and servicing of (20) (34)
finance
Taxation (18) (65)
Capital expenditure and financial (11) (28)
investment
285 33
Equity dividends paid (104) -
CASH INFLOW BEFORE FINANCING 181 33
Financing 61 110
INCREASE IN CASH IN THE PERIOD 242 143
RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT 2005 2004
£'000 £'000
Increase in cash in the period 242 143
Net cash inflow from bank loans (61) (123)
Cash outflow in respect of hire purchase - 13
CHANGE IN NET DEBT 181 33
NET DEBT AT 1 APRIL 2004 (314) (346)
NET DEBT AT 31 MARCH 2005 (133) (314)
The classification of the invoice discounting advance has been changed from
`other creditors' to `overdrafts' and the comparatives restated.
Notes to the Cash Flow Statement
A. Reconciliation of operating profit/(loss) to net cash inflow from operating
activities
2005 2004
£'000 £'000
Operating profit/(loss) 535 (162)
Depreciation 52 62
Loss on disposal fixed assets - 15
(Increase)/decrease in debtors (1,173) 695
Increase/(decrease) in creditors 920 (450)
Net cash inflow from operating 334 160
activities
B. Analysis of cash flows for headings netted in the cash flow
Returns on investment and servicing of finance
2005 2004
£000 £000
Interest received 1 -
Interest paid (21) (31)
Interest element of hire purchase - (3)
Net cash outflow from returns on investments and (20) (34)
servicing of finance
Taxation
2005 2004
£000 £000
Taxation (18) (65)
Capital expenditure
2005 2004
£000 £000
Payments to acquire tangible fixed assets (11) (29)
Receipts from sale of fixed assets - 1
Net cash outflow from capital expenditure (11) (28)
Financing
2004 2003
£000 £000
Increase in bank loans 61 123
Capital element of hire purchase - (13)
Net cash outflow from financing 61 110
C. Analysis of net debt
As restated Cash flows At 31st
March 2005
At 1st
April 2004
£000 £000 £000
Cash in hand and at bank - 51 51
Overdrafts (191) 191 -
(191) 242 51
Debt due within 1 year (123) (61) (184)
Total (314) 181 (133)
Notes to the Preliminary Results
1. Publication of non-statutory accounts
The financial information set out in this preliminary announcement does not
constitute statutory accounts as defined in Section 240 of the Companies Act
1985.
The financial statements for the year ended 31 March 2004, which received an
unqualified auditors' report, and did not contain a statement under section 237
(2) or (3) of the Companies Act 1985, have been delivered to the Registrar of
Companies.
The financial information set out in this preliminary announcement for the year
ended 31 March 2005 has been extracted from the Group's financial statements to
that date which have received an unqualified auditors' report, but have not yet
been delivered to the Registrar of Companies.
2. Taxation on ordinary activities
(a) Analysis of charge in the year
2005 2004
£000 £000
Current tax:
In respect of the year:
UK Corporation tax based on the results 200 (44)
for the year at 30% (2004 - 30%)
Over provision in prior year - (3)
Total current tax 200 (47)
Deferred tax:
Origination and reversal of timing (9) (7)
differences
Tax charge/credit on profit/(loss) on ordinary 191 (54)
activities
(b) Factors affecting current tax charge
The tax assessed on the profit/(loss) on ordinary activities for the year is
higher than the standard rate of corporation tax in the UK of 30% (2004 - 30%).
2005 2004
£000 £000
Profit/(loss) on ordinary activities before 515 (196)
taxation
Profit/(loss) on ordinary activities multiplied 155 (59)
by the standard rate of tax
Disallowable expenditure 40 10
Depreciation for period in excess of capital 5 8
allowances
Adjustments in respect of prior periods - (3)
Marginal rate relief - (3)
Total current tax 200 (47)
3. Earnings per Share
Earnings/(loss) per share 2005 2004
pence pence
- basic 3.12 (1.36)
- diluted 2.89 (1.36)
The basic earnings per share amounting to 3.12p (2004 - loss 1.36p) for the
year have been calculated on £324,000 (2004 - loss of £143,000) being the
consolidated profit on ordinary activities after taxation attributable to
members of the Company for the year ended 31 March 2005, and are based on the
weighted average number of ordinary shares in issue and to be issued of
10,400,000 (2004 - 10,400,000).
The fully diluted earnings per share amounting to 2.89p (2004 - loss 1.36p) for
the year have been calculated on the basis of adding 820,450 (2004 - 100,000)
to the weighted average number of shares in issue, to take account of the
dilutive effect of the outstanding share options to give 11,220,450 (2004 -
10,500,000) shares being in issue, assuming that all options are exercised.
4. Copies of the Report and Accounts will be sent to shareholders in due course
and will be available from the head office of the Company, RDF Group plc, 2
Bartholomews, Brighton BN1 1HG
Further Enquiries:
RDF Group plc Tel: 01273 200100
David Wood
John East & Partners Limited Tel: 020 7628 2200
John East
Simon Clements
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