Interim Results

Boot(Henry) PLC 26 September 2002 HENRY BOOT PLC INTERIM RESULTS Henry Boot PLC, the housebuilding, property and construction group, announces its Interim Results for the half-year ended 30th June 2002. HIGHLIGHTS PRE-TAX PROFIT UP 9% EARNINGS PER SHARE UP 10% DIVIDEND PER ORDINARY SHARE UP 9% WE REMAIN OPTIMISTIC FOR THE FULL YEAR Enquiries: Jamie Boot, Group Managing Director - Tel: 0114 255 5444 CHAIRMAN'S STATEMENT I am pleased to report that your company has shown growth in pre-tax profit for the first six months of the year despite a small decline in turnover. As our focus moved further away from the highly competitive arena of general contracting, our other markets remained buoyant. This applied particularly to housing where, fuelled by strong demand, turnover and profit advanced over the previous year's corresponding period. After allowing for interest costs on lower than anticipated borrowings, group operating profit of £5.4m translated to profit before tax of £5.1m, an increase in excess of 9%. New Homes Pre-tax profit exceeded our expectations with completions totalling 362 (against 301 for the same period last year) and the average selling price rising by 10%. A strong order book led us into the second half of this year and, providing external factors do not undermine what is still a thriving market, we anticipate further profit growth by the year-end. As ever, the dearth of new land continues to haunt the industry and is resulting in ever-increasing land costs. Property Development A high level of activity was maintained in the half-year with the business enjoying a successful trading period which included continuing rental income and the completion of major investment sales at Skegness and Hull. Property remains an alternative investment medium to equities and bonds and, with prime yields relatively stable at or around the 7% mark, prospects are encouraging. Ongoing schemes continue to attract institutional interest and a number of new opportunities have arisen that should ensure satisfactory returns, both prior to and beyond the year-end. Land Management Responding to both internal and external demand, our land trading company achieved a number of site sales and, at the same time, succeeded in obtaining further allocations and consents, notably in Scotland. However, the activity faces uncertainty and change in the form of the Government's Planning Green Paper. The continuing trend under 'Planning Policy Guidance Note No.3: Housing' appears to be for more allocated sites in adopted Local Plans to be called in, with the inevitable risk of refusal and considerable delays which are exacerbating land supply problems. However, the amount of land owned or under the control of the company continues to increase and this, in turn, will support future gains. Construction First half turnover in our construction companies in England fell below that for 2001 as both our traditional contracting and specialist construction businesses encountered highly competitive conditions. Progress was made, however, with overall results coming in ahead of 2001. In Scotland, the forward order book remained satisfactory and a number of contracts, particularly for the water authorities, were successfully concluded. Looking ahead, it is anticipated that our construction activities will return better results for this full year. Plant Hire Whilst turnover and utilisation levels remained ahead of the previous year's interim period, margins fell away and this, coupled with increased bad debts, resulted in a reduction of pre-tax profit. With pressure likely to remain on margins, it is unlikely that the out-turn for 2002 will be ahead of last year despite progress made with the introduction of further tool hire facilities. Training The skills shortage within the construction industry is unlikely to improve in the short term, a fact which is reflected in the difficulties encountered by many of our training centres in recruiting trainees. We continue to provide apprenticeship programmes and the skills assessment necessary to secure the Construction Skills Certification Scheme card. Results on slightly reduced turnover were down on the previous year. Earnings, Dividend, Outlook With earnings per share increasing in line with pre-tax profit and a strong market in our core activities, we remain optimistic regarding the results for the full year. In view of our strong balance sheet, an increase in net assets per share from 316p to 325p in the six month period and a modest net gearing of below 10%, your Board has approved an increased interim dividend of 3.6p (2001 3.3p). John S. Reis Chairman 26th September 2002 THE UNAUDITED RESULTS OF THE GROUP INCLUDE : Half Half Year ended ended ended 30th 30th 31st June June December 2002 2001 2001 £'000 £'000 £'000 Turnover - continuing operations Group and share of associates 93,933 99,969 234,124 Less: Share of associates 1,471 1,155 2,669 ----------- ----------- ----------- 92,462 98,814 231,455 ----------- ----------- ----------- Operating profit 4,666 4,652 13,046 Share of operating profits of associates 700 465 1,261 ----------- ----------- ----------- Total operating profit 5,366 5,117 14,307 Interest (94) (305) (628) Share of interest of associates (152) (131) (269) ----------- ----------- ----------- Profit on ordinary activities before tax 5,120 4,681 13,410 Tax on profit on ordinary activities (1,457) (1,400) (3,619) ----------- ----------- ----------- Profit for the period 3,663 3,281 9,791 ----------- ----------- ----------- Dealt with as follows: Dividends: Cumulative preference shares (non-equity) 11 11 21 Interim of 3.6p (2001 3.3p) 915 823 3,038 Profit retained 2,737 2,447 6,732 ----------- ----------- ----------- 3,663 3,281 9,791 ----------- ----------- ----------- Earning per ordinary share 14.5p 13.2p 39.3p ----------- ----------- ----------- Diluted earnings per ordinary share 14.1p 12.8p 38.1p ----------- ----------- ----------- SUMMARISED GROUP BALANCE SHEET AT 30TH JUNE 2002 30th 31st 30th June December June 2002 2001 2001 Unaudited Audited Unaudited £'000 £'000 £'000 Fixed assets Tangible assets 31,361 31,807 31,358 Investments 2,463 2,346 2,368 ----------- ----------- ----------- 33,824 34,153 33,726 ----------- ----------- ----------- Current assets Stocks 106,883 94,422 112,175 Debtors 14,178 15,082 20,670 Cash at bank and in hand 7,364 18,653 80 Creditors: amount falling due within one year (62,997) (65,497) (71,392) ----------- ----------- ----------- Net current assets 65,428 62,660 61,533 ----------- ----------- ----------- Total assets less current liabilities 99,252 96,813 95,259 Creditors: amounts falling due after more than one year (12,055) (12,579) (16,327) Provisions for liabilities and charges (2,527) (2,587) (2,037) ----------- ----------- ----------- 84,670 81,647 76,895 ----------- ----------- ----------- Capital and reserves Called up share capital 2,989 2,968 2,967 Capital redemption reserve fund 271 271 271 Share premium account 2,159 1,698 1,678 Property revaluation reserve 11,810 12,010 11,569 Profit and loss account 66,915 64,174 59,884 Other reserves 526 526 526 ----------- ----------- ----------- 84,670 81,647 76,895 ----------- ----------- ----------- Being: Non-equity shareholders' funds 400 400 400 Equity shareholders' funds 84,270 81,247 76,495 ----------- ----------- ----------- 84,670 81,647 76,895 ----------- ----------- ----------- GROUP STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES Half year Half year Year ended ended ended 30th June 30th June 31st December 2002 2001 2001 Unaudited Unaudited Audited £'000 £'000 £'000 Profit for the financial period 3,663 3,281 9,791 Unrealised surplus on property revaluation - - 551 Elimination of revaluation surplus (196) (148) (253) Total recognised gains and losses for the ----------- ----------- ----------- period 3,467 3,133 10,089 ----------- ----------- ----------- SUMMARISED GROUP CASH FLOW STATEMENT Half year Half year Year ended ended ended 30th June 30th June 31st December 2002 2001 2001 Unaudited Unaudited Audited £'000 £'000 £'000 Net cash (outflow) inflow from operating activities (6,840) 3,614 36,275 Dividends received from associates 231 201 695 Returns on investment and servicing of finance (268) (289) (672) Taxation (1,405) (1,107) (2,884) Capital expenditure and financial investment (1,757) (3,386) (267) Acquisition - (431) (392) Equity dividends paid (2,221) (1,986) (2,802) ----------- ----------- ----------- Cash (outflow) inflow before use of liquid resources and financing (12,260) (3,384) 29,953 Financing (108) 283 (203) ----------- ----------- ----------- (Decrease) increase in cash (12,368) (3,101) 29,750 ----------- ----------- ----------- NOTES TO GROUP CASH FLOW STATEMENT Half year Half year Year ended ended ended 30th June 30th June 31st December 2002 2001 2001 Unaudited Unaudited Audited £'000 £'000 £'000 Reconciliation of net cash flow to movement in net funds (Decrease) increase in cash (12,368) (3,101) 29,750 Cash outflow from decrease in debt and lease financing 590 295 802 New finance leases - (1,502) (3,264) ----------- ----------- ----------- Change in net funds (11,778) (4,308) 27,288 Net funds (debt) at 31st December 2001 4,998 (22,290) (22,290) ----------- ----------- ----------- Net (debt) funds at 30th June 2002 (6,780) (26,598) 4,998 ----------- ----------- ----------- Reconciliation of operating profit to operating cash flow Operating profit 4,666 4,652 13,046 Depreciation and amortisation 2,104 2,057 4,118 Profit on tangible fixed assets (100) (67) (148) (Decrease) increase in stocks (12,458) (4,340) 13,411 Decrease in debtors 930 551 6,088 (Decrease) increase in creditors and provisions (1,982) 761 (240) ----------- ----------- ----------- Net cash (outflow) inflow from operating activities (6,840) 3,614 36,275 ----------- ----------- ----------- Analysis of net debt At Cash At 31.12.01 flows 30.06.02 £'000 £'000 £'000 Cash at bank 18,653 (11,289) 7,364 Overdraft - (1,079) (1,079) Loans (10,000) - (10,000) Finance leases (3,655) 590 (3,065) ----------- ----------- ----------- 4,998 (11,778) (6,780) ----------- ----------- ----------- Notes 1. The 2001 year-end results are an abridged version of the unqualified audited accounts filed with the Registrar of Companies. The financial information set out above does not comprise statutory accounts within the meaning of Section 240 Companies Act 1985 2. Earnings per ordinary share are calculated on the weighted average number of shares in issue. 3. The interim dividend amounting to £915,240 (2001 £823,017) will be paid on 31st October 2002 to shareholders whose names are on the register at the close of business on 4th October 2002. 4. At the Board meeting on 25th September 2002 the directors formally approved the issue of these statements which have not been reviewed by the auditors. 5. The interim financial information has been prepared using accounting policies consistent with those adopted by the Group in its accounts for the year ended 31st December 2001. 6. Property valuations have been brought forward without amendment from the previous annual accounts. This information is provided by RNS The company news service from the London Stock Exchange

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