Interim Results
Carillion PLC
12 September 2001
Leading construction to services group
Carillion plc announces first half results
* Pre-tax profit of £9.0 million (2000:£12.6m before exceptional items)
after substantial investment in PFI
* Zero Group interest charge with net cash of £49.2m
* Profit growth in Services and Infrastructure Management
* New record order book of £4.7 billion
* Business Improvement Programmes launched
* Interim dividend up three per cent to 1.38 pence
Commenting, Carillion Chairman Sir Neville Simms, said, 'Our results for the
half year ended 30 June 2001, demonstrate the progress being made by the new
management team to accelerate the Group's strategy. Profits in Facilities
Management and Infrastructure Management increased significantly, the Group's
interest charge reduced to zero, investment in PFI increased substantially and
our order book rose to a new record level of £4.7 billion, of which 86 per
cent is in PFI, Services and Infrastructure Management.
'Given the size and quality of our order book and the continuing prospects for
growth in most of our main markets where we have well established positions,
the Board expects full year trading to be in line with market forecasts and is
confident that the longer term outlook remains positive.'
For further information contact
Chris Girling Finance Director
John Denning Corporate Affairs and Communications Director
0207 628 5646 until 12 noon, 12 September 2001 and
01902 422431 thereafter
CHAIRMAN'S STATEMENT
Our results for the half year ended 30 June 2001 demonstrate the progress
being made by our new senior management team to accelerate the strategy for
changing the Group's business mix through developing our Private Finance and
services-related activities, while focusing selectively on higher added value
work in construction. The main features of the first half of 2001 were profit
growth in Facilities Management and Infrastructure Management, a reduced
interest charge, increased investment to develop our Private Finance business
and a 17 per cent increase since December 2000 in the Group's order book to a
new record level of £4.7 billion.
Turnover was five per cent higher for the six months to 30 June 2001, compared
with the corresponding period last year, primarily due to growth in our
Facilities Management activities. Total operating profit was £10.5 million
compared to £14.5 million (before exceptional charges of £25.0 million). This
reduction was due to a substantial increase in the resources being invested in
PFI, including bidding for a growing number of PFI projects in our chosen
market segments, coupled with the effect of our policy of writing-off all bid
costs until we become the preferred bidder. This resulted in a first half loss
in Private Finance, which we expect to reverse in the second half as new
projects reach preferred bidder stage.
Net interest reduced from £1.9 million to £1.5 million, because interest on
debt not associated with PFI reduced to zero. This reduction, together with a
cash inflow from operating activities of £12.4 million and net cash at 30 June
2001 of £49.2 million, compared with £50.7 million at 31 December 2000,
reflects a continuing improvement in cash management and progress in reducing
average underlying debt.
Profit before tax was £9.0 million compared with £12.6 million, (before all
exceptional items) in the first half of 2000. Earnings per share were 1.8
pence compared with 4.9 pence (before all exceptional items) for the
corresponding period last year. Excluding the effect of our investment in
Private Finance, profit before tax for the rest of the Group showed an
encouraging improvement. Consequently, the Board has increased the interim
dividend by three per cent to 1.38 pence.
In line with the Group's strategy of adopting a more focused and selective
approach to construction, the disposal of Carillion Housing was completed
successfully in August for a consideration of some £6 million, which is
sufficient to cover the costs of retained contracts.
The Group is also embarking on a major Business Improvement Programme that
will involve extensive restructuring, commencing in the second half of the
year, which will yield significant benefits in the future. We expect to take a
restructuring charge of the order of £10 million in the second half.
As a result of winning a number of key contracts, the Group's order book has
increased to a new record level of £4.7 billion, of which some 86 per cent
relates to our Private Finance and services-related activities. Given the size
and quality of our order book and the continuing prospects for growth in most
of our main market segments, particularly UK infrastructure, Private Finance
and facilities and estate management services, where we have well established
positions, the Board expects operating performance for the full year to be in
line with market forecasts and is confident that the longer term outlook
remains positive.
Sir Neville Simms
Chairman
CHIEF EXECUTIVE'S REVIEW
In the first six months of 2001 we accelerated our strategic progress. Profit
increased significantly in both Facilities Management and Infrastructure
Management, where the performance of our rail businesses in particular
continued to improve. We have also invested heavily in developing our Private
Finance business, improved cash management and continued to reduce our average
underlying debt. At the same time, we have maintained a highly selective
approach in construction, targeting higher added value projects with our 30
long-term key customers. Our order book has increased substantially to £4.7
billion, with notable first half successes in Infrastructure Management.
In the second half we are implementing two important Business Improvement
Programmes. The first will ensure the understanding and adoption of our core
values by all our people so that the culture across all our businesses
continues to change to support our strategy, where the emphasis on quality of
service is paramount in order to deliver solutions to meet or exceed our
customers' needs.
The second is aimed at increasing efficiency and effectiveness to ensure that
whatever we do, we do it well and 'right first time'. In April, we
restructured our senior management team, to enable us to focus more
effectively on our strategic objectives. We are now beginning the next
fundamental phase of our restructuring programme to improve the efficiency and
effectiveness of our entire organisation. We will be introducing a number of
Group-wide Shared Service Centres to manage a wide range of processes common
to all our Business Units, for example IT, Finance, Human Resources and Legal
Services. We shall also be radically streamlining the UK Regional organisation
of our Construction Businesses to create leaner, customer facing Business
Units focused on delivering the needs of our customers, 'right first time'.
This integrated approach will make us more responsive to our customers' needs
as well as helping us to reduce both internal and external costs through
removing duplication and managing all our suppliers more efficiently and
effectively. As a consequence we expect to reduce our UK employees by up to
400, for which there will be an exceptional charge of the order of £10 million
in the second half of the year, although the costs will be spread over the
next twelve months or so. As we shall be simultaneously investing heavily in
new information management systems, the full annualised benefits of the
restructuring will not be seen until 2003.
As indicated in the following segment reviews, prospects in our main markets
remain positive. Therefore, our strategy continues to provide a sound basis
upon which to develop the Group's business and, coupled with our Business
Improvement Programmes, deliver steady earnings growth along with prudent
financial management.
Private Finance
H1 2001 H1 2000
Turnover £131m £126m
Operating (Loss)/Profit (£2.6m) £3.4m
The first half-operating loss in Private Finance is temporary and reflects the
lumpy nature of accounting for bid costs. Specifically, the movement from
profit to loss reflects an increase in net operating costs resulting from the
combined effects of substantially increasing the resources we are investing in
bidding for PFI projects and our policy of writing off all bid costs until we
become the preferred bidder - the point at which bid costs are treated as
recoverable.
The Private Finance market has continued to move ahead strongly and the
substantial increase in bid costs is in response to a growing number of
opportunities, especially in our main sectors of health, transport and secure
establishments. Currently, we are the preferred bidder for one project and
shortlisted for 15 projects worth some £3 billion. However, the timing of
projects is such that we were appointed preferred bidder on only one project -
Manchester Magistrates Court - in the first half of the year. A number of
large projects for which we are shortlisted are not expected to reach
preferred bidder until later this year or perhaps early next year.
Consequently, although our PFI order book has remained at some £2.7 billion,
we expect it to increase significantly over the next twelve months given our
historic success rate of 1 in 3.5 for securing preferred bidder positions. A
return to profitability is therefore expected for the full year.
Since the beginning of the year, four more projects have moved from
construction to the operational phase. Consequently, eleven of our fifteen
financially closed projects are now operating successfully with the other four
moving through the construction phase.
SERVICES
H1 2001 H1 2000
Turnover £162m £132m
Operating Profit £5.3m £4.5m
Margin 3.3% 3.4%
The 18 per cent increase in operating profit in this segment reflects a strong
performance by Carillion Services in facilities management, as Monteray's
contract with BT is now fully operational. Monteray's contract with BT has set
a new benchmark for outsourcing integrated facilities management and continues
to generate considerable interest in the corporate sector among companies
which own and manage large estates.
We continue to track in-line with the recovery programme for Crown House
Engineering (CHE) announced in August 2000. Restructuring of CHE has been
completed, with the number of employees reduced by over 1,000 and operational
centres cut from eleven to seven. Although the objectives are challenging, we
remain committed to delivering the business strategy for CHE and returning it
to profitability.
With our order book more than doubled to £760 million and with the outsourcing
market still growing strongly, prospects in this segment continue to be very
positive.
INFRASTRUCTURE MANAGEMENT
H1 2001 H1 2000
Turnover £140m £146m
Operating Profit £4.7m £1.6m*
Margin 3.4% 1.1%
* After the £2 million charge for GTRM restructuring
Although turnover in Infrastructure Management was broadly unchanged,
operating profit increased to £4.7 million, as a result of improved
performances by Centrac, our track renewal business, and GTRM, our joint
venture rail maintenance business.
After a slightly slow start to the year in terms of activity levels in rail,
we subsequently secured a number of significant maintenance contracts working
in alliance with Railtrack, worth over £360 million. These included a
five-year IMC 2000 contract for West Coast Mainline South. In addition, our
rail projects business is working in alliance with Railtrack on a number of
major projects that form part of the West Coast Route Modernisation, most of
which are still in the design phase and therefore offer the prospect of
significant medium term growth for this expanding part of our rail business.
We were delighted win further key contracts from the Highways Agency worth
nearly £300 million, including two five-year Area Maintenance Contracts,
namely Area 5 (the whole of the M25) and Area 8 (some 1,000 km of motorway and
trunk roads in the Home Counties and East Midlands), where a Carillion led
joint venture has become the first ever Managing Agent Contractor (MAC). Under
this form of contract, the management and maintenance of the network has been
let as a single package. Our success in securing the first MAC is real
evidence of the emphasis we place on quality of service, given that tenders
were assessed on a basis that ascribed 80 per cent of value to quality and 20
per cent to price.
These successes increased our order book by nearly 70 per cent to £540
million, over 75 per cent of which is for 2002 and beyond, improving medium
and longer-term prospects.
CAPITAL PROJECTS
H1 2001 H1 2000
Turnover £260m £232m
Operating Profit/(Loss) £1.4m £2.5m
Margin 0.5% 1.1%
Turnover in Capital Projects increased by 12 per cent primarily due to good
progress on the Birmingham Northern Relief Road contract and increased
activity in our Overseas Regions. The reduction in operating profit relates to
a loss on final settlement of an old power and process contract of the kind we
no longer undertake. Excluding the effect of this settlement, underlying
performance was slightly ahead of that for the first half of 2000.
In this segment, we have continued to focus specifically on projects that
enable us to offer higher added value services. In the first half of 2001, we
successfully secured two major contracts in the Middle East - a three-year
management contract for construction of the £120 million Qasr Al Alam Guest
Complex in Oman and a £100 million joint venture contract for construction of
the first phase of residential buildings at the Dubai Marina - a region where
we have a profitable business that has been well established for over 30
years.
In the UK, medium to longer-term prospects for securing further good quality
contracts remain positive, particularly if the £180 billion of investment in
the Government's 10-year transport plan proceeds as announced. In our Overseas
Regions our traditional markets continue to remain firm and the prospects for
Private Finance projects and for securing new services-related business also
continue to look encouraging. However, with the continuing focus in this
segment on quality of earnings, turnover is unlikely to increase significantly
in the full year and beyond.
BUILDING
H1 2001 H1 2000
Turnover £299m £327m
Operating Profit £5.6m £6.0m
Margin 1.9% 1.8%
The nine per cent reduction in turnover in our Building segment was the result
of our selective approach of focusing on higher added value contracts with
long-term customers and thus our operating margins improved slightly to 1.9
per cent. Our Building business also continues to generate cash and operates
on negative working capital.
Despite the concern over the effect of the world economy, the commercial
building market on which we are focused, continues to run at record levels.
Although turnover in this segment is unlikely to increase due to our highly
selective approach, we expect to improve profitability further in this segment
in the second half.
Building activity on Private Finance projects, which we report in our Private
Finance segment, already accounts for a substantial proportion of the overall
output of our building businesses. Therefore, with substantial growth expected
in PFI building activity in line with our strategy, we will continue to
redirect resources from non-PFI building onto PFI projects, where margins are
significantly better.
John McDonough
Chief Executive
Unaudited Consolidated Profit and Loss Account
For the half year ended 30 June 2001
Half year Half year Year to 31
to 30 June to 30 June December
2001 £m 2000 2000 £m
restated £m
Total turnover 970.2 926.1 1,909.0
Deduct turnover of joint ventures (120.3) (100.3) (228.0)
Group turnover 849.9 825.8 1,681.0
Group operating (loss)/profit before (0.9) 9.6 29.4
exceptional operating items
Exceptional operating items - (25.0) (30.0)
Group operating loss (0.9) (15.4) (0.6)
Group share of operating profit of 11.4 4.9 13.8
joint ventures
Total operating profit/(loss) 10.5 (10.5) 13.2
Profit on sale of businesses - 3.1 3.1
Net interest payable: Group - (1.3) (1.5)
Joint ventures (1.5) (0.6) (1.8)
(1.5) (1.9) (3.3)
Profit/(loss) on ordinary activities 9.0 (9.3) 13.0
before taxation
Taxation on profit/(loss) on ordinary (3.1) 4.6 (4.6)
activities
Profit/(loss) on ordinary activities 5.9 (4.7) 8.4
after taxation
Equity minority interests (2.2) - (1.0)
Profit/(loss) for the financial period 3.7 (4.7) 7.4
Equity dividends (2.7) (2.8) (8.6)
Retained profit/ (loss) for Group and 1.0 (7.5) (1.2)
its share of joint ventures
Earnings/(loss) per ordinary share
- Basic 1.8p (2.3p) 3.6p
- Diluted 1.8p (2.3p) 3.6p
Adjusted earnings per ordinary share
(excluding exceptional items)
- Basic 1.8p 4.9p 13.3p
- Diluted 1.8p 4.8p 13.3p
Dividends per ordinary share 1.38p 1.34p 4.12p
Unaudited Consolidated Balance Sheet
At 30 June At 30 June At 31
2001 2000 December 2000
£m £m £m
Fixed assets
Intangible assets 1.6 1.6 1.6
Tangible assets 41.4 49.3 46.8
Investments in joint ventures : Share 608.5 449.3 556.3
of gross assets
Share of gross liabilities (551.5) (402.4) (515.0)
Other investments 57.0 46.9 41.3
4.2 2.2 1.9
104.2 100.0 91.6
Current assets
Stocks 46.6 49.1 45.3
Debtors 582.8 547.8 523.5
Investments 8.1 6.8 8.0
Cash at bank and in hand 86.3 137.4 84.0
723.8 741.1 660.8
Creditors: amounts falling due within
one year
Bank loans and overdrafts (19.2) (71.1) (15.4)
Other Creditors (649.1) (625.9) (581.6)
(668.3) (697.0) (597.0)
Net current assets
Due within one year 34.9 23.0 44.1
Debtors due after more than one year 20.6 21.1 19.7
55.5 44.1 63.8
Total assets less current liabilities 159.7 144.1 155.4
Creditors: amount falling due after
more than one year
Bank loans (17.9) (17.2) (17.9)
Other creditors (6.7) (6.3) (7.9)
(24.6) (23.5) (25.8)
Provisions for liabilities and (0.9) (3.9) (0.9)
charges
Net assets 134.2 116.7 128.7
Financed by:
Capital and reserves
Called up share capital 106.0 103.3 105.3
Reserves 25.0 13.4 22.4
Equity shareholders' funds 131.0 116.7 127.7
Equity Minority Interests 3.2 - 1.0
134.2 116.7 128.7
Unaudited Consolidated Statement of Total Recognised Gains and Losses
Half year to Half year to 30 Year to 31
30 June 2001 June 2000 restated December 2000
£m £m £m
Profit/(loss) for the 3.7 (4.7) 7.4
financial period
Exchange movements - - 1.0
Total recognised gains and 3.7 (4.7) 8.4
losses for the period
Unaudited Reconciliation of Movements in Consolidated Equity Shareholders'
Funds
Half year to Half year to Year to 31
30 June 2001 30 June 2000 December 2000
£m £m £m
Profit/(loss) for the financial 3.7 (4.7) 7.4
period
Dividends (2.7) (2.8) (8.6)
1.0 (7.5) (1.2)
New share capital subscribed by - 1.8 1.8
Quest
Other new share capital 2.3 - 3.7
subscribed
Exchange movements - - 1.0
Transfer arising on issue of - (1.8) (1.8)
shares to Quest
Net addition to/(reduction in)
equity shareholders' funds 3.3 (7.5) 3.5
Opening equity shareholders'
funds 127.7 124.2 124.2
Closing equity shareholders' 131.0 116.7 127.7
funds
Summarised Consolidated Cash Flow Statement and Reconciliation of Net Funds
Half year Half year to Year to 31
to 30 June 30 June 2000 December
2001 2000
£m £m £m
Net cash inflow/(outflow) from 12.4 (71.1) (64.1)
operating activities
Debenture advance to joint ventures (3.6) - (6.8)
Net cash inflow/(outflow) from returns
on investments and servicing of 5.8 (0.4) 7.1
finance
Corporate taxation paid (0.8) (0.4) (1.1)
Net cash outflow from capital (1.8) (6.3) (12.1)
expenditure and financial investments
Net cash outflow from acquisitions and (8.9) (3.7) (0.1)
disposals
Equity dividends paid (3.5) - (4.6)
Net cash outflow before management of (0.4) (81.9) (81.7)
liquid resources and financing
Net cash inflow/(outflow) from
management of liquid resources 2.2 7.7 (0.3)
Financing - (repayment)/drawdown of (1.1) 5.9 5.6
debt
Increase/(decrease) in cash in the 0.7 (68.3) (76.4)
period
Reconciliation of Net Cash Flow to Movement in Net Funds
Half Half year to 30 Year to
year to June 2000 31
30 June £m December
2001 2000
£m £m
Increase/(decrease) in cash 0.7 (68.3) (76.4)
Cash (inflow)/outflow from management
of liquid resources (2.2) (7.7) 0.3
Net drawdown of debt - (6.4) (6.4)
Effect of foreign exchange rate - - 1.7
changes
Movement in net funds in the period (1.5) (82.4) (80.8)
Net funds at start of period 50.7 131.5 131.5
Net funds at end of period 49.2 49.1 50.7
Reconciliation of Operating Profit to Operating Cash Flows
Half year to Half year to Year to 31
30 June 2001 30 June 2000 December
£m Restated 2000
£m £m
Group operating profit before 10.5 14.5 45.2
exceptional operating items
Share of operating profits of joint (11.4) (4.9) (13.8)
ventures
Depreciation 6.1 6.3 13.7
(Profit)/loss on disposal of fixed (1.7) 0.1 (0.3)
assets
Amortisation of goodwill - 0.1 0.1
Decrease in market value of listed - - 0.1
current asset investments
Decrease in provisions - - (3.0)
(Increase)/decrease in stocks (1.3) 10.5 14.6
Increase in debtors (47.5) (73.3) (40.2)
Increase/(decrease) in creditors due 59.2 (23.7) (80.7)
within one year
(Decrease)/increase in creditors due (0.6) (0.4) 1.2
after more than one year
Increase/(decrease) in bills of 1.0 (0.3) 0.8
exchange
Net cash inflow/(outflow) from 14.3 (71.1) (62.3)
operating activities before
exceptional items
Exceptional operating cash spend (1.9) - (1.8)
Net cash inflow/(outflow) from 12.4 (71.1) (64.1)
operating activities
Notes
1. Basis of Preparation
The interim accounts which are unaudited have been prepared using the
accounting policies set out in the 2000 Annual Report.
The financial information included in this report does not constitute
statutory accounts for the purpose of section 240 of the Companies Act
1985. The financial information for the year ended 31 December 2000 has
been extracted from the statutory accounts for that financial year. Those
accounts have been reported on by the company's auditors and have been
delivered to the Registrar of Companies. The auditor's report was
unqualified and did not contain a statement under Section 237(2) or (3) of
the Companies Act 1985.
2. Segmental analysis
Half Year ended Half Year ended Year ended
30 June 2001 30 June 2000 31 December 2000
£m £m £m
Turnover
Class of business:
Building 299.4 327.0 618.9
Capital Projects 260.5 232.0 510.5
Services 161.6 132.2 306.7
Infrastructure Management 140.2 145.9 307.5
Private Finance 131.0 126.1 249.3
Internal trading (22.5) (37.1) (83.9)
970.2 926.1 1,909.0
Half year ended 30 Half Year Ended 30 Year Ended
June 2001 June 2000 31 December
£m £m 2000
£m
Geographical
origin:
UK 815.4 776.8 1,573.1
Europe 83.4 79.1 157.3
Other 71.4 70.2 178.6
970.2 926.1 1,909.0
Operating profit/(loss)
Half Year Ended 30 Half Year Year Ended
June 2001 Ended 31 December
£m 30 June 2000
2000 £m
restated
£m
Class of business:
Building 5.6 6.0 18.1
Capital Projects 1.4 2.5 8.5
Services 5.3 4.5 6.2
Infrastructure Management 4.7 1.6 11.7
Private Finance (2.6) 3.4 8.9
Corporate Centre (3.9) (3.5) (8.2)
Operating profit before 10.5 14.5 45.2
exceptional
Operating items
Exceptional operating items - (25.0) (32.0)
Total operating profit/ 10.5 (10.5) 13.2
(loss)
Geographical origin:
UK 8.7 11.3 35.0
Europe 0.2 0.2 2.9
Other 1.6 3.0 7.3
Operating profit before 10.5 14.5 45.2
exceptional
Operating items
Exceptional operating items - (25.0) (32.0)
Total operating profit/ 10.5 (10.5) 13.2
(loss)
Share of joint ventures
The segmental analysis of the Group's share of joint ventures is set out below:
Half Year Ended Half Year Ended Year Ended 31
30 June 30 June December
2001 2000 2000
Turnover Operating Turnover Operating Turnover Operating
£m Profit £m Profit £m Profit
£m £m £m
Class of business:
Building 4.1 3.5 3.8 0.1 6.2 1.8
Capital Projects 29.5 - 26.2 1.0 77.6 0.9
Services - - - - - -
Infrastructure 67.1 3.9 63.8 1.7 128.8 8.1
Management
Private Finance 19.6 4.0 9.7 2.1 25.1 5.0
Internal Trading - - (3.2) - (9.7) -
120.3 11.4 100.3 4.9 228.0 15.8
Exceptional operating - - - - - (2.0)
items
_____ _____ _____ _____ _____ _____
120.3 11.4 100.3 4.9 228.0 13.8
==== ==== ==== ===== ==== ====
3. Exceptional operating items
Half Year Half Year Year Ended
Ended Ended 31 December
30 June 30 June 2000
2001 2000
restated
Gross Tax Gross Tax Gross Tax
Credit Credit Credit
£m £m £m £m £m £m
Operating items: '
Subsidiary undertakings:
Exceptional cost of sales
Provision against contract losses
in Crown House Engineering - - 25.0 (7.4) 25.0 (7.1)
Exceptional Administrative
Expenses
Reorganisation costs - - - - 5.0 (1.5)
- - _____ _____ _____ _____
25.0 (7.4) 30.0 (8.6)
Joint ventures: - - - - 2.0 (0.6)
Reorganisation costs
Total exceptional operating items - - 25.0 (7.4) 32.0 (9.2)
Non operating items:
Profit on sale of businesses - - (3.1) - (3.1) -
_____ _____ _____ _____ _____ _____
Total exceptional items - - 21.9 (7.4) 28.9 (9.2)
==== ==== ==== ===== ==== ====
The directors have considered the appropriateness of the Group's accounting
presentation regarding the disclosure of the profit and loss account charge in
respect of the Founders' Equity Plan share scheme. Previously, the Group
reported the expense as a component of exceptional operating items which
appeared on the face of the profit and loss account. The directors have
concluded that the Founders' Equity Plan expense is now not so significant to
warrant separate disclosure and accordingly a more true and fair view would be
achieved by including the expense within operating expenses.
The effect of this change in accounting presentation for the current period is
that £0.9 million of expense that would previously have been included in
exceptional operating items has been charged in arriving at Group operating
profit before exceptional operating items. This reallocation has had no effect
on the result for the period.
The comparative period to 30 June 2000 in respect of the profit and loss
account and cash flow statement has been restated in accordance with the
revised presentation to reallocate the corresponding charge of £1.3 million
from exceptional operating items to operating expenses. An exceptional
operating item of £25.0 million is presented compared to £26.3 million as
previously stated. The Group operating loss remains at £15.4 million as
originally stated.
In accordance with the revised presentation adjusted earnings per share for
the half year ended 30 June 2000 has been restated. The basic and diluted
adjusted earnings per share are now reported as 4.9 pence and 4.8 pence
respectively from 5.3 pence and 5.2 pence respectively as originally stated.
4. Taxation
Based on profit projections for the year to 31 December 2001 the forecast
full year tax charge is estimated to be 34%. The tax charge in respect of
the profit arising in the six month period to 30 June 2001 has been
calculated by reference to the expected full year tax rate. The forecast
full year rate is higher than the standard rate of UK tax due to
permanently disallowable items and deferred tax not equalised.
5. Dividends
The interim ordinary dividend of 1.38p per share (2000: 1.34p) will be
paid on 16 November 2001, to shareholders on the register at the close of
business on 21 September 2001.
6. Earnings/(loss) per ordinary share
a. Basic
Earnings/(loss) per ordinary share is calculated by dividing the profit
for the financial period, amounting to £3.7m (six months ended 30 June
2000: £4.7m loss; year ended 31 December 2000: £7.4m profit) by
205,164,315 (six months ended 30 June 2000: 203,285,592; year ended 31
December 2000; 204,212,811) ordinary shares being the weighted average
number of shares in issue during the period.
b. Adjusted
A reconciliation of the basic earnings/(loss) per ordinary share to
the adjusted amounts shown on the face of the profit and loss account
to illustrate the impact of exceptional items is set out below:
Half Year Ended Half Year Ended Year Ended
30 June 30 June 31 December
2001 2000 2000
restated
£m Pence Per £m Pence per £m Pence
share share per share
Profit/(loss) attributable to
shareholders 3.7 1.8 (4.7) (2.3) 7.4 3.6
Exceptional items: - - 25.0 12.3 32.0 15.7
Operating items
Less profit on sale of
businesses - - (3.1) (1.5) (3.1) (1.5)
Less taxation in respect of - - (7.4) (3.6) (9.2) (4.5)
the above
Earnings before all _____ _____ _____ _____ ____ ____
exceptional items
3.7 1.8 9.8 4.9 27.1 13.3
==== ==== ==== ==== === ===
As described in note 3, the adjusted earnings per share for the period
to 30 June 2000 has been restated following a change in the disclosure
of the profit and loss charge in respect of the Founders' Equity Plan
share scheme.
(c) Diluted
Diluted earnings/(loss) per ordinary share have been calculated using
the same numerators as set out in (a) and (b) above and by reference
to the following number of shares:
Number of ordinary shares
30 June 30 June 31
2001 2000 December
2000
m m m
Number of ordinary shares per basic earnings/ 205.2 203.3 204.2
(loss) per share calculations
Adjustments to reflect dilutive shares under
option 2.9 1.7 -
Number of ordinary shares per diluted earnings/ 208.1 205.0 204.2
(loss) per share calculations
7. Approval of interim statement
The interim statement was approved by the Board of Directors on 11
September 2001 and such approval was re-affirmed by a Committee of the
Board on 12 September 2001.
Independent review report by KPMG Audit Plc to Carillion plc
Introduction
We have been instructed by the company to review the financial information set
out on pages 9 to 17 and we have read the other information contained in the
interim report and considered whether it contains any apparent misstatements
or material inconsistencies with the financial information.
Directors' responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the directors. The Listing
Rules of the Financial Services Authority require that the accounting policies
and presentation applied to the interim figures should be consistent with
those applied in preparing the preceding annual accounts except where they are
to be changed in the next annual accounts in which case any changes, and the
reasons for them, are to be disclosed.
Review work performed
We conducted our review in accordance with guidance contained in Bulletin 1999
/4: Review of interim financial information issued by the Auditing Practices
Board. A review consists principally of making enquiries of group management
and applying analytical procedures to the financial information and underlying
financial data, and based thereon, assessing whether the accounting policies
and presentation have been consistently applied unless otherwise disclosed. A
review is substantially less in scope than an audit performed in accordance
with Auditing Standards and therefore provides a lower level of assurance than
an audit. Accordingly we do not express an audit opinion on the financial
information.
Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 June 2001.
KPMG Audit Plc
Chartered Accountants, Birmingham
12 September 2001
Monday, 20th May 2024
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