Interim Results

Creightons PLC 20 December 2006 Creightons plc Interim financial report For the six months ended 30 September 2006 Chairman's Statement The integration of our manufacturing facilities onto the one site at Peterborough is now largely complete, with the last stage of the closure of the Storrington site being completed over the next few weeks. I am pleased to report the consequential cost savings we anticipated have now begun to flow through into the consolidated income statement. Sales in the first half to 30th September of £4,944,000 (2005: £5,209,000; -£265,000, -5.1%) have been slightly affected by a lower Christmas gift programme and more difficult trading environment for some of our private label customers. However, sales of our own branded product, where we achieve higher margins, have benefited from new products launched over the past 6 months. This product launch programme has continued through the second half of the year. The lower sales levels have resulted in a slightly reduced gross margin which at £2,034,000 is £44,000 lower than last year's figure of £2,078,000. However, the change in product mix due to the increased proportion of sales of our own branded products and the cost saving arising from the integration of the operations in Peterborough has resulted in an improved gross margin percentage at 41.1% compared to 39.9% in 2005, an improvement of 1.2%. The board took the decision at the beginning of the year to make a significant investment in resources to cope with the high level of new product development associated with the branded development programme and a major re-launch with a key private label customer. It is hoped that the benefit of this investment will be seen in the next year with a full year of sales of the new products. This investment of some £250,000 however has resulted in a loss from operations for the first half of £144,000 (2005: profit before exceptional items of £87,000). It should also be remembered that last year's first half result included the gain on disposal of the Storrington site as an exceptional profit of £413,000. Interest costs have fallen as borrowings have been repaid. We have made targeted investments in additional plant and equipment to boost capacity in our liquid production department to cope with the increase in activity in this area of our business. Additionally, inventories are higher than in previous years due to the planned build-up of stocks to cope with a major launch of over 120 new products scheduled for February 2007. Despite recording a loss these are positive results as the investment in new products and improved capacity should result in long term improvements in sales and profitability. W O McIlroy Executive Chairman 20 December 2006 Creightons plc Interim financial report For the six months ended 30 September 2006 Consolidated income statement - unaudited Six months ended Year ended 30 September 31 March 2006 2005 2006 Note £000 £000 £000 Revenue 4,944 5,209 12,568 Cost of sales (2,910) (3,131) (7,686) Gross Profit 2,034 2,078 4,882 Distribution costs (157) (125) (299) Administration costs (2,021) (1,866) (4,099) Exceptional profit - 413 442 (Loss)/profit from operations (144) 500 926 Finance costs (30) (93) (118) (Loss)/profit before tax (174) 407 808 Tax - - 15 (Loss)/profit for the period attributable to the holders (174) 407 823 of the parent company Earnings per share Basic 1 (0.32p) 0.75p 1.52p 1.5p Diluted 1 (0.29p) 0.69p 1.40p 1.4p Creightons plc Interim financial report 30 September 2006 Consolidated balance sheet - unaudited 30 September 31 March 2006 2005 2006 £000 £000 £000 Non-current assets Goodwill 364 364 364 Other intangible assets 75 1 84 Property, plant and equipment 448 445 336 887 810 784 Current assets Inventories 3,434 3,127 1,805 Trade and other receivables 1,669 2,776 1,328 Cash and cash equivalents 93 5 77 5,196 5,908 3,210 Total assets 6,083 6,718 3,994 Current liabilities Trade and other payables 1,903 2,029 1,491 Short term borrowings 2,151 2,954 343 4,054 4,983 1,834 Non-current liabilities Long term borrowings 45 - 13 Deferred tax - 15 - 45 15 13 Total liabilities 4,099 4,998 1,847 Net assets 1,984 1,720 2,147 Equity Share capital 543 543 543 Share premium account 1,229 1,229 1,229 Capital redemption reserve 18 18 18 Capital reserve 7 7 7 Special reserve 13 13 13 Share-based payment reserve 58 36 47 Retained earnings 116 (126) 290 Total equity available to the holders of the parent 1,984 1,720 2,147 company Creightons plc Interim financial report For the year ended 30 September 2006 Statement of changes in shareholders equity - unaudited Share Share Other Share-based Retained Total capital premium reserves payment earnings reserve £000 £000 £000 £000 £000 Balance at 1 April 2005 543 1,229 38 26 (533) 1,303 Profit for six months ended 30 - - - - 407 407 September 2005 Credit to equity for share based - - - 10 - 10 payments Balance at 30 September 2005 543 1,229 38 36 (126) 1,720 Profit for six months ended 31 March - - - - 416 416 2006 Credit to equity for share based - - - 11 - 11 payments Balance at 31 March 2006 543 1,229 38 47 290 2,147 Loss for six months ended 30 September - - - - (174) (174) 2006 Credit to equity for share based - - - 11 - 11 payments Balance at 30 September 2006 543 1,229 38 58 116 1,984 Creightons plc Interim financial report For the year ended 30 September 2006 Consolidated cash flow statement - unaudited Six months ended Year ended 30 September 31 March 2006 2005 2006 Note £000 £000 £000 Net cash (outflow)/ inflow from operating activities 2 (1,639) (2,218) 577 Cash flow from investing activities Interest received - - 3 Proceeds on disposal of property, plant and equipment 8 1,567 1,596 Purchase of property, plant and equipment (168) (97) (168) Expenditure on intangible assets (24) - (86) Net cash (used in)/from investing activities (184) 1,470 1,345 Cash flow from financing activities Repayment of borrowings (1) (452) (1,581) New finance lease obligations 32 - 16 Increase/(decrease) in bank overdrafts 1,808 1,204 (281) Net cash from / (used in) financing activities 1,839 752 (1,846) Net increase in cash and cash equivalents 16 4 76 Cash and cash equivalents at start of period 77 1 1 Cash and cash equivalents at end of period 93 5 77 Creightons plc Interim financial report For the year ended 30 September 2006 Notes to the interim financial report 1 Earnings per share The calculation of the basic and diluted earnings per share is based on the following data: Six months ended Year ended 30 September 31 March 2006 2005 2006 £000 £000 £000 Earnings Net (loss)/profit attributable to the equity holders of (174) 407 823 the parent company Six months ended Year ended 30 September 31 March 2005 2004 2006 Number Number Number Number of shares Weighted average number of ordinary shares for the 54,275,876 54,275,876 54,275,876 purposes of basic earnings per share Effect of dilutive potential ordinary shares relating 5,426,550 4,882,203 4,582,203 to Share options Weighted average number of ordinary shares for the 59,702,426 59,158,079 58,858,079 purposes of diluted earnings per share 2 Related party transactions Transactions between the company and its subsidiary, which are related parties, have been eliminated on consolidation and are not disclosed in this note. During the period no transactions were entered into with Whiskin Limited. The comparative figures summarise the transactions the group companies entered into with Whiskin Limited, a related party who is not a member of the group: Six months ended Year ended 30 September 31 March 2006 2005 2006 £000 £000 £000 Loan payable to Whiskin Limited Start of period - 653 653 Interest earned - 26 32 Repayments of interest and capital - (14) (685) End of period - 665 - Whiskin Limited is a company of which Mr McIlroy is a director and controlling shareholder. The amounts outstanding were unsecured and were settled in cash. No guarantee was given or received. During the period Oratorio Developments Ltd, a company in which Mr McIlroy is a director and controlling shareholder, acquired the freehold site occupied by the company's wholly owned subsidiary, Potter & Moore Innovations Ltd. 3. Availability of accounts The interim report is being sent to shareholders. Further copies can be obtained from the Company's registered office, 1210 Lincoln Road, Peterborough, Cambridgeshire, PE4 6ND. This information is provided by RNS The company news service from the London Stock Exchange

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