Interim Results
James Halstead PLC
28 March 2002
28 March 2002
JAMES HALSTEAD PLC
INTERIM RESULTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2001
KEY FIGURES
James Halstead, manufacturer and international distributor of flooring:
Pre-tax profit up to £ 5.358 million - an increase of 5.1%
Net dividend per ordinary share up to 4.75p - an increase of 8%
Earnings per ordinary share up to 13.10p - an increase of 12.8%
Net assets per ordinary share up to 179.20p - an increase of 6%
Geoffrey Halstead, Chairman said 'The challenges of this business continue but I
believe our focus on investment, quality and our core products allows us to look
forward to the full year with confidence.'
Enquiries: Mark Halstead, Chief Operating Officer
Gordon Oliver, Financial Director
Telephone: 0161 767 2500 on Thursday, 28 March 2002
CHAIRMAN'S STATEMENT
Trading Results
In difficult times it is pleasing to report, once again, record results for the
half-year ended 31 December 2001.
Turnover at £44.9 million is slightly below that of the comparative period last
year but this reduction reflects the disposal of Conway Products. Pre -tax
profit has increased by 5.1%.
Over the last five years, very significant investment in manufacturing has taken
place. We added PU coating to the higher added value products : Finesse,
Prestige and Mystique and developed Supratec as the top end of our range of
safety flooring. The acquisition of Objectflor (Germany), Polyflor Norge
(Norway), Halstead Flooring Concepts (New Zealand), Karndean (Germany), and the
joint ventures in other markets, have strengthened our presence in key markets.
The overall team at the Head Office remains no larger than it was a decade ago.
In the current climate we are happy with the progress made in this half-year.
There are areas where growth has not been significant, for example in Germany
where economic confidence is low, but new product launches are timetabled for
the next few weeks. The motorcycle market has been very fragile after two large
retailers went into administration; but despite this, pre-season commitments in
the form of orders from customers are at a record level though our approach will
be prudent in this sector.
AIM
The recent move from the official list to AIM seems to have been well received
by our shareholders and it is our belief that there will be a greater attraction
to our shares from AIM investors where our market presence will be more
significant to that market.
Earnings per Share and Dividend
Earnings per share of 13.1p show an increase of 12.8%, reflecting both increased
profits and the cumulative effect of the purchase by the company of its own
shares.
We are increasing the dividend by 7.95% to 4.75p per ordinary share. This will
be paid on 31 May 2002 to shareholders on the register as at 12 April 2002.
Once again, we will offer shareholders the opportunity of choosing to take new
fully paid ordinary shares in lieu of cash.
Accounting Policies
The adoption of the latest accounting standard, FRS 19 - Deferred Taxation, is
mandatory. This increases our theoretical tax charge, but has no effect on cash
flows from taxation, and our commitment to reinvestment in plant continues.
Outlook
The challenges of this business continue, but I believe our focus on investment,
quality and our core products allows us to look forward to the full year with
confidence.
Geoffrey Halstead
Chairman
28 March 2002
Interim Report
For the half-year ended 31 December 2001
Half-year Half-year Year
ended ended ended
31.12.01 31.12.00 30.6.01
as restated as restated
£'000 £'000 £'000
Turnover 44,889 45,288 93,541
Group profit on ordinary activities
(before taxation) 5,358 5,098 10,689
Taxation (1,740) (1,697) (3,538)
Group profit on ordinary activities
(after taxation) 3,618 3,401 7,151
Dividends:
Preference (5.5%) - non-equity (6) (6) (11)
Ordinary - equity (1,302) (1,314) (3,686)
Retained profit 2,310 2,081 3,454
Earnings per ordinary share of 10p:
- headline 13.10p 11.61p 24.66p
- basic and fully diluted 12.84p 11.37p 24.16p
Net dividends per ordinary share 4.75p 4.4p 12.75p
Net assets per ordinary share 179.20p 169.12p 172.51p
Consolidated Balance Sheet
As at 31 December 2001
Half-year Half-year Year
ended ended ended
31.12.01 31.12.00 30.6.01
as restated as restated
£'000 £'000 £'000
Fixed assets
Intangible assets 2,490 2,636 2,563
Tangible assets 22,028 23,868 22,774
24,518 26,504 25,337
Current assets
Stocks 19,104 18,195 18,806
Debtors 16,226 18,451 20,305
Cash at bank, in hand and on short-term deposits 14,505 8,918 10,069
49,835 45,564 49,180
Creditors - amounts falling due
within one year (22,122) (18,684) (22,453)
Net current assets 27,713 26,880 26,727
Total assets less current liabilities 52,231 53,384 52,064
Creditors - amounts falling due after more than one
year (207) (181) (201)
Provisions for liabilities and charges (2,694) (2,483) (2,653)
49,330 50,720 49,210
Capital and reserves
Equity share capital 2,742 2,987 2,841
Non-equity share capital 200 200 200
Called up share capital 2,942 3,187 3,041
Share premium account 3,766 3,317 3,766
Revaluation reserve 3,544 3,670 3,544
Capital reserve 428 156 328
Profit and loss account 38,650 40,390 38,531
49,330 50,720 49,210
Consolidated Cash Flow Statement
For the half-year ended 31 December 2001
Half-year Half-year Year
ended ended ended
31.12.01 31.12.00 30.6.01
£'000 £'000 £'000
Net cash inflow from operating activities 9,436 8,229 15,851
Returns on investments and servicing of finance 228 80 214
Taxation 136 (1,002) (3,259)
Capital expenditure (385) (2,208) (3,290)
Acquisitions and disposals - 187 582
Equity dividends paid (2,372) (2,300) (3,140)
Cash inflow before use of liquid resources and
financing 7,043 2,986 6,958
Management of liquid resources (396) (181) (2,277)
Financing:
Purchase of own shares (2,623) - (2,684)
Increase in cash 4,024 2,805 1,997
Reconciliation of net cash flow to movement in net
funds
Increase in cash 4,024 2,805 1,997
Cash flow from change in liquid resources 396 181 2,277
Change in net funds resulting from cash flows 4,420 2,986 4,274
Effect of exchange differences 16 (172) (309)
Movement in net funds for the period 4,436 2,814 3,965
Net funds at 30 June 2001 10,069 6,104 6,104
Net funds at 31 December 2001 14,505 8,918 10,069
Statement of Total Recognised Gains and Losses
For the half year ended 31 December 2001
Half-year Half-year Year
ended ended ended
31.12.01 31.12.00 30.6.01
as restated as restated
£'000 £'000 £'000
Profit for the financial period 3,618 3,401 7,151
Currency translation differences on foreign
currency net investments (49) (408) (600)
Total recognised gains relating to the financial
period 3,569 2,993 6,551
Prior year adjustment (2,265)
Total recognised gains since the last report 1,304
Reconciliation of Movements in Shareholders' Funds
for the half-year ended 31 December 2001
Half-year Half-year Year
ended ended ended
31.12.01 31.12.00 30.6.01
as restated as restated
£'000 £'000 £'000
Profit for the financial period 3,618 3,401 7,151
Dividends (1,308) (1,320) (3,697)
2,310 2,081 3,454
Other recognised gains and losses relating to the
financial period (49) (408) (600)
Purchase of own shares (2,141) - (3,166)
New share capital subscribed - - 475
Net increase in shareholders' funds for the 120 1,673 163
financial period
Opening shareholders' funds (originally £51,475,000
before prior year adjustment of £2,265,000) 49,210 49,047 49,047
Closing shareholders' funds 49,330 50,720 49,210
Equity shareholders' funds 49,130 50,520 49,010
Non-equity shareholders' funds 200 200 200
49,330 50,720 49,210
Notes to the Accounts
1. Basis of preparation
The interim financial statements, which are unaudited, have been prepared on the
basis of accounting policies as set out in the annual report and accounts for
the year ended 30 June 2001, after giving effect to the adoption of FRS
19-Deferred Tax.
2. Taxation
Taxation has been provided at the rate of 32.5% (2000: 33.3%). These figures are
post FRS 19, which has the effect of increasing the theoretical tax charge.
3. Dividends
The interim dividend is payable on 31 May 2002 to those shareholders on the
register at the close of business on 12 April 2002. The preference dividend,
which was paid on 31 December 2001, is in respect of 5.5% cumulative preference
shares. The next preference dividend is payable on 30 June 2002 to those
preference shareholders on the register at the close of business on 24 May 2002.
4. Calculation of earnings per ordinary share
Half-year Half-year Year
ended ended ended
31.12.01 31.12.00 30.6.01
as restated as restated
£'000 £'000 £'000
Profit on ordinary activities after taxation 3,618 3,401 7,151
Preference dividend (6) (6) (11)
Basic earnings 3,612 3,395 7,140
Goodwill amortisation charge 74 74 147
Headline earnings 3,686 3,469 7,287
Weighted average number of ordinary shares 28,146,307 29,872,443 29,553,763
in issue
Headline earnings per ordinary share 13.10p 11.61p 24.66p
Basic and fully diluted earnings per 12.84p 11.37p 24.16p
ordinary share
5. Statutory accounts
The figures for the year ended 30 June 2001 are an abridged statement of the
group audited accounts for that year adjusted for the effect of the adoption of
FRS 19 - Deferred Tax. The audited accounts, containing an unqualified audit
report have been delivered to the registrar of companies.
6. Copies of the interim results
Copies of the interim results have been sent to shareholders. Further copies can
be obtained from the company's registered office, Beechfield, Hollinhurst Road,
Radcliffe, Manchester M26 1JN.
7. Prior year adjustment
The prior year adjustment, relating to the adoption of FRS 19 - Deferred Tax,
has changed previously reported results as follows:
Half-year ended Year ended
31.12.00 30.06.01
as reported as restated as reported as restated
£'000 £'000 £'000 £'000
Profit and loss account:
Profit after taxation 3,569 3,401 7,598 7,151
Profit retained 2,249 2,081 3,901 3,454
Balance sheet:
Debtors 17,954 18,451 19,917 20,305
Provisions for liabilities and - 2,483 - 2,653
charges
Profit and loss account 42,376 40,390 40,796 38,531
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