Half-year Report

RNS Number : 3862D
Heavitree Brewery PLC
06 July 2016
 

The Heavitree Brewery PLC

Trood Lane

Matford

Exeter EX2 8YP

 

Date:                6 July 2016

 

Contact:           Graham Crocker - Managing Director - 01392 217733

Nicola McLean - Company Secretary - 01392 217733

Patrick Castle /Anita Ghanekar - Shore Capital - 0207 408 4052

 

Following a meeting by a duly authorised committee of the Board of Directors held today, 6 July 2016, the Directors announce the interim results for the six months ended 30 April 2016.

 

 

Chairman's statement

The Company has returned an operating profit of £630,000 (2015: £507,000) for the period under review.  Last year's corresponding operating profit for the period was affected by a number of factors including some extraordinary costs such as a properties' valuation cost before our new banking facility, an agency cost for the operation of a tenancy over the winter period plus a lack of contribution from two houses where major refurbishments were being carried out.  These houses are now operational again and together with some improved rental terms on some new tenancy agreements, I am pleased to be able to report a 24% increase in operating profit on the previous year.

 

Results

The Group operating profit is £630,000 (2015: £507,000), a 24% increase on the previous year.  After allowing for finance costs of £124,000 (2015: £117,000) which includes a £28,000 interest cost in respect of the IAS19 calculation referring to the final salary Pension Scheme (2015: £23,000), the Group Profit before taxation is £505,000 (2015: £395,000) which shows a 28% increase on the previous year.

 

Dividend

The Directors have resolved to pay an interim dividend of 3.675p per Ordinary Share and 'A' Limited Voting Ordinary Share (2015: 3.675p).  The dividend will be paid on 5 August 2016 to shareholders on the Register at the close of business on 22 July 2016.

 

Property

In respect of the properties previously reported as being marketed for sale; the sale of one of the new houses on Topsham Road in Exeter on the former site of the Country House Inn completed on 29 June and the sale of the Hole in the Wall in Dawlish completed on 24 May.

 

The Maltster's Arms in Harbertonford has been taken off the market and is now open and trading after a new lease was granted to an experienced local operator.

 

Having received notice from the incumbent tenant, the Carpenter's Arms in Ilsington, a small house best suited to an owner operator, was placed on the market in April. An acceptable offer was received in very short order and the sale completed on 24 June.

 

Prospects

Work has commenced on the refurbishment of the Dolphin Inn in Torquay which closed earlier in the year.  We look forward to reopening this house in August 2016. Following a long closure, development work is also planned to start shortly on the Dartmoor Halfway Inn in Bickington. When completed, both should add significantly to our income stream.

In line with our expectations we have made a solid start to trading in the second half of the year and the Company is well positioned before the beginning of the summer season.

 

N H P TUCKER

Chairman

 

 

Group income statement (unaudited)

For the six months ended 30 April 2016

 

 

 

6 months

to

30 April
2016

 

6 months

to

30 April

2015

Audited

12 months

to

31  October

2015

 

Note

£' 000

£' 000

£' 000

Revenue

 

          3,312

          3,277

          7,082

Change in stocks

 

-

-

-

Other operating income

 

117

113

229

Purchase of inventories

 

(1,322)

(1,405)

(2,986)

Staff costs

 

(600)

(562)

(1,172)

Depreciation of property, plant and equipment

 

(103)

(108)

(218)

Other operating charges

 

          (774)

          (808)

       (1,523)

 

 

       (2,682)

       (2,770)

       (5,670)

Group operating profit

 

630

507

1,412

(Loss)/profit on sale of property, plant and equipment

 

              (1)

                 5

                 5

Movements in valuation of estate and related assets

 

                 -

                  -

            (47)

Group profit before finance costs and taxation

 

629

512

1,370

Finance income

 

8

5

8

Finance costs

 

(104)

(99)

(170)

Other finance costs-pensions

 

            (28)

            (23)

            (35)

 

 

          (124)

          (117)

          (197)

Profit before taxation

 

505

395

1,173

Tax (expense)

 

          (128)

          (103)

          (258)

Profit for the period

 

             377

             292

             915

Earnings per share

- basic
- diluted

2

 

7.7p
7.7p

 
 

 

6.0p
6.0p

 

18.8p

18.8p

 

 

 

Group statement of comprehensive income (unaudited)

For the six months ended 30 April 2016

 

 

 

6 months

to

30 April
2016

 

6 months

to

30 April

2015

    Audited

   12months

    to

 31 October

      2015

 

 

£' 000

  £' 000

       £' 000

Profit for the period

 

             377

             292

             915

Items that will not be reclassified to profit or loss

 

Actuarial gains/(losses) on defined benefit pension plans

Tax relating to items that will not be reclassified

 

 

 

 

350

             (70)

280  

 

 

411

             (82)

329

 

 

(740)

             147

(593)

 

Items that may be reclassified to profit or loss

Cash flow hedges

Fair Value adjustment

Exchange rate differences on translation of subsidiary undertaking

Tax relating to items that may be reclassified

 

 

 

 

-

3

(3)

 

                  -

-

 

20

1

(2)

 

                  -

19

 

24

(2)

-

 

                 (4)

18

Other comprehensive income for the year, net of tax

 

             657

             640

             340

Total comprehensive income attributable to:

Equity holders of the parent

 

 

             657

 

             640

 

             340

 

 

 

 

 

 

 

 

 

Dividends

The Directors declare an interim dividend of 3.675p per share (2015 - 3.675p) on the Ordinary and 'A' Limited Voting Ordinary Shares. This dividend will be paid on 05 August 2016 to shareholders on the register at 22 July 2016.

 

 

 

Group balance sheet (unaudited)

at 30 April 2016

 

 

30 April

2016

£' 000

 

30 April

2015

£' 000

Audited

31 October 2015

£'000

Non-current assets

 

 

 

 

Property, plant and equipment

 

16,950

 

16,077

17,242

Financial assets

 

37

37

34

 

Deferred tax asset

 

          100 

                 50

             282

 

 

       17,087

          16,164

        17,558

Current assets

 

 

 

 

Trade and other receivables

 

1,312

1,785

1,359

Inventories

 

10

10

10

Cash and short-term deposits

 

              93

               114

               51

 

 

         1,415

            1,909

          1,420

Assets held for sale

 

1,408

-

 

645

Total assets

 

      19, 910

          18,073

        19,623

Current liabilities

 

 

 

 

Trade and other payables

 

(821)

(1,055)

(759)

Financial liabilities

 

(2,349)

(1,580)

(1,753)

Income tax payable

 

         (106)

            (184)

             (96)

 

 

      (3,276)

         (2,819)

        (2,608)

Non-current liabilities

 

 

 

 

Other payables

 

(275)

(241)

(258)

Financial liabilities

 

(6,011)

(5,011)

(6,011)

Deferred tax liabilities

 

(305)

(200)

(305)

Defined benefit pension plan

 

         (500)

            (249)

        (1,411)

 

 

      (7,091)

         (5,701)

        (7,985)

Total liabilities

 

    (10,367)

         (8,520)

      (10,593)

Net assets

 

         9,543

            9,553

          9,030

Capital and reserves

 

 

 

 

Equity share capital

 

264

264

264

Capital redemption reserve

 

673

673

673

Treasury shares

 

(1,201)

(1,190)

(1,235)

Fair value adjustments reserve

 

17

17

14

Cash flow hedging reserve

 

-

-

-

Currency translation

 

4

5

7

Retained earnings

 

         9,786

            9,784

          9,307

Total equity

 

         9,543

            9,553

          9,030

 

 

 

Group statement of cash flows (unaudited)

for the six months ended 30 April 2016

                                                           

 

 

 

6 months

to

30 April
2016

 

6 months

to

30 April

2015

Audited

12months

 to

31 October

2015

 

 

£' 000

£' 000

£' 000

Profit for the period

Tax expense

Net finance costs

 

377

128

124

292

103

117

915

258

197

Loss/(profit) on disposal of non-current assets and assets held for sale

 

1

(5)

(5)

Depreciation and impairment of property, plant and equipment

 

103

108

265

Decrease/(increase) in trade and other receivables

 

62

(651)

(114)

Increase/(decrease)  in trade and other payables

 

79

104

(171)

Net pension charge

 

          (591)

          (522)

          (522)

Cash generated from operations

 

283

(454)

823

Income taxes paid

 

          (6)

     -  

         (143)

Interest paid

 

   (104)

            (98)  

          (170)

Net cash inflow/(outflow) from operating activities

 

             173

          (552)  

             510

 

Investing activities

 

 

 

 

Interest received

 

8

5

8

Proceeds from sale of property, plant and equipment and assets held for sale

 

4

24

20

Payments to acquire property, plant and equipment

 

       (594)

       (1,050)

    (3,124)  

Net cash outflow from investing activities

 

       (582)

       (1,021)

 (3,096)  

Financing activities

 

 

 

 

Preference dividend paid

 

(1)

(1)

(1)

Equity dividends paid

 

(179)

(179)

(358)

Consideration received by EBT on sale of shares

 

40

30

30

Consideration paid by EBT on purchase of shares

 

(5)

(21)

(65)

Movement in long term borrowing                                                                 

 

                 - 

 

               250

          1,250

Net cash(outflow)/ inflow from financing activities

 

     (145) 

               79

             856

 

 

 

 

 

Decrease in cash and cash equivalents

 

(554)

(1,494)

(1,730)

Cash and cash equivalents at the beginning of the period

 

       (1,702) 

      28  

         28  

Cash and cash equivalents at the period end.

 

  (2,256) 

        (1466)

  (1,702) 

 

 

Group reconciliation of movements in equity (unaudited)

 

 

 

6 months to

Equity

Capital

 

Fair

 

Cashflow

 

 

30 April 2016

share

redemption

Treasury

value

Currency

hedge

Retained

Total

 

capital

reserve

shares

adjustment

Translation

reserve

earnings

equity

 

£' 000

£' 000

 £' 000

£' 000

£' 000

£' 000

£' 000

£' 000

 

 

 

 

 

 

 

 

 

At 1November  2015

264

673

(1,235)

14

      7

-

9,307

9,030

Profit for the period

-

-

          -

         -

        -

-

      377

    377

 

Other comprehensive income for the period, net of income tax

-

-

          -

  3    

     ( 3)

 -

      280

    280

Total     comprehensive income

 

 

 

 

 

 

 

 

for the period

 

-

-

-

3

     (3)

    -

    657

  657

Consideration

received

by EBT on sale of shares                                 

 

 

 

 

-

 

 

 

-

 

 

 

40

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

40

Consideration paid

 

 

 

 

 

 

 

 

by EBT on purchase of

 

 

 

 

 

 

 

 

shares

-

-

(5)

-

-

-

-

(5)

 

 

 

 

 

 

 

 

 

Gain by EBT on sale

 

 

 

 

 

 

 

 

of shares

 

-

-

(1)

-

-

-

1

-

 

 

 

 

 

 

 

 

 

Equity dividend  paid

 

-

-

-

-

-

-

(179)

(179)

 

 

 

 

 

 

 

 

 

At 30 April 2016

264

673

(1,201)

17

4

-

9,786

9,543

 

 

 

 

 

Group reconciliation of movements in equity (unaudited) - continued

 

 

6 months to

Equity

Capital

 

Fair

 

Cashflow

 

 

30 April 2015

share

redemption

Treasury

value

Currency

hedge

Retained

Total

 

capital

reserve

shares

adjustment

Translation

reserve

earnings

Equity

 

£' 000

£' 000

 £' 000

£' 000

£' 000

£' 000

£' 000

£' 000

 

 

 

 

 

 

 

 

 

At 1 November  2014

264

673

(1,202)

16

7

(20)

9,345

9,083

Profit for the period

 

-

-

-

-

-

-

292

292

Other comprehensive income for the period net of income tax

 

-

-

-

1

(2)

20

329

348

Total     comprehensive income

 

 

 

 

 

 

 

 

for the period

 

-

-

-

1

(2)

20

621

640

Consideration received by EBT on sale of shares

 

 

-

 

 

-

 

 

30

 

 

-

 

 

-

 

 

-

 

 

-

 

 

30

Consideration paid by EBT on purchase of shares                                 

 

 

 

-

 

 

-

 

 

    (21)

 

 

   -

 

 

   -

 

 

   -

 

 

   -

 

 

(21)

Loss by EBT on sale of shares

 

-

-

   3

 -

 

-

-

(3)

-

Equity dividend  paid

 

-

-

-

  -

  -

  -

(179)

(179)

 

 

 

 

 

 

 

 

 

At 30 April 2015

264

673

(1,190)

17

5

-

9,784

9,553

 

 

 

 

 

 

 

 

 

 

 

 

Group reconciliation of movements in equity (unaudited) - continued

 

 

 

12 months to

Equity

Capital

 

Fair

 

Cashflow

 

 

31 October 2015

share

redemption

Treasury

value

Currency

hedge

Retained

Total

Audited

capital

reserve

shares

adjustment

Translation

reserve

earnings

Equity

 

£' 000

£' 000

 £' 000

£' 000

£' 000

£' 000

£' 000

£' 000

 

 

 

 

 

 

 

 

 

At 1 November  2014

264

673

(1,202)

16

7

(20)

9,345

9,083

Profit for the year

 

-

-

-

-

-

-

915

915

Other comprehensive income for the year, net of income tax

-

-

-

(2)

-

20

(593)

(575)

Total     comprehensive income

 

 

 

 

 

 

 

 

for the year

 

-

-

-

(2)

-

20

322

340

Consideration

received by EBT on sale of shares                                 

 

 

 

-

 

 

-

 

 

30

 

 

-

 

 

-

 

 

-

 

 

-

 

 

30

Consideration paid by EBT on purchase of shares

 

 

-

 

 

-

 

 

(65)

 

 

 

-

 

 

-

 

 

-

 

 

-

 

 

(65)

Loss by EBT on sale of shares

 

-

-

2

-

 

-

-

(2)

-

Equity dividend  paid

 

-

-

-

-

-

-

(358)

(358)

 

 

 

 

 

 

 

 

 

At 31 October 2015

264

673

(1,235)

14

7

-

9,307

9,030

                               

 

Equity share capital

The balance classified as share capital includes the total net proceeds (both nominal value and share premium) on issue of the Company's equity share capital, comprising 5p Ordinary and 'A' Limited Voting Ordinary Shares.

Treasury shares

Treasury shares represent the cost of The Heavitree Brewery PLC shares purchased in the market and held by The Heavitree Brewery PLC Employee Benefit Trust ('EBT').

 

 

 

Notes to the interim results

 

1.  Basis of preparation

 

These unaudited interim condensed and consolidated financial statements do not constitute statutory accounts within the meaning of section 435 of the Companies Act 2006.  They have been prepared on the basis of the accounting policies that were complied with in the annual financial statements for the year ended 31 October 2015. The accounting policies are drawn up in accordance with International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board.

These unaudited financial statements were approved and authorised for issue by a duly appointed and authorised committee of the Board of Directors on 6 July 2016.

 

 

2.  Basic and diluted earnings per share

The calculation of basic earnings per ordinary share is based on earnings of £377,000 (2015: £292,000), being profit after taxation for the period, and on 4,872,387 (2015: 4,868,704) shares being the weighted average number of Ordinary and 'A' Limited Voting Ordinary Shares in issue during the period after excluding the shares owned by The Heavitree Brewery PLC Employee Benefits Trust and those shares under option pursuant to the Employee Share Option Scheme. Employee share options could potentially dilute basic earnings per share in the future but are not included in the interim calculation of dilutive earnings per share because they are antidilutive for the period presented. The Ordinary Shares and the 'A' Limited Voting Ordinary Shares have equal dividend rights and therefore no separate calculation of earnings per share for the different classes has been given.

 

3.  Segment information

 

Primary reporting format - Business segments

The primary segmental reporting format is determined to be business segments as the Group's risks and rates of return are affected predominantly by differences in the products and services provided.

During the year the Group operated in one business segment-leased estate.

Leased estate represents properties which are leased to tenants to operate independently from the Group.

 

4.  Interim report

 

Copies of this announcement are available from the Company at Trood Lane, Matford, Exeter EX2 8YP. The Company's interim report for the six months ended 30 April 2016 has been posted to shareholders today and will be available on our website at www.heavitreebrewery.co.uk.

 

Ends.

 


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