Half Yearly Report

RNS Number : 2611S

Latham(James) PLC

29 November 2012

 

HALF YEARLY RESULTS FOR THE PERIOD ENDED 30 SEPTEMBER 2012 

Chairman's statement

I am pleased to report good results for the six months to 30 September 2012, in trading conditions which have been as difficult as at any time since early 2009.

Results

Overall the results are similar to the same period last year. Revenue for the six months to 30 September 2012 was £74,789,000 compared to £74,207,000 for the same period last year. The operating profit was £4,283,000, compared to £4,382,000 last year. Finance Income was £13,000 (2011: £26,000) and Finance Costs were £508,000 (2011: £249,000), reflecting higher assumed interest on the increased pension scheme deficit. There was a profit of £257,000 on the sale of the Ossett site, following the relocation of the site to a new depot in Leeds. Profit before tax was £4,045,000, down from last year's £4,159,000. Earnings per ordinary share were 16.4p (2011: 16.1p).

As at 30 September 2012 shareholder funds had increased to £47.2m (30.9.2011: £44.7m) with cash and cash equivalents of £5.2m (2011: £3.9m).

Interim dividend

The Board has declared an interim dividend of 3.1p per Ordinary Share (2011: 3.0p), which is covered 5.3 times (2011: 5.4 times). The dividend is payable on 23 January 2013 to ordinary shareholders on the Company's Register at close of business on 4 January 2013.  The ex-dividend date will be 2 January 2013.

Six months trading to 30 September 2012.

In difficult trading conditions, group revenue has grown by £582,000 helped by late orders for the Olympic venues. Both prices and volumes remained at similar levels to the previous six months although the summer months were quieter than we have seen in recent years. Panel products showed good growth, although trade in timber products declined, with weaknesses and bad debts in the joinery sector.

Trading margins for the six months to 30 September 2012, whilst still under pressure, have slowly improved over the last year. Overheads have been well controlled and the move of our largest depot from Ossett to Leeds was achieved with little impact on day to day trading. Cash balances at the end of September 2012 were £5.2m. We continue to take advantage of cash settlement discounts from suppliers where this represents a good return on our cash.

Pension scheme

The IAS19 valuation shows that the scheme deficit has increased to £14.9m from £12.3m in March. This is mainly because the reduction in AA grade bond yields has increased the present value of pension scheme liabilities. This measure is very volatile. The trustees and the company have agreed a recovery plan to pay off the actuarial deficit over ten years.

Current & future trading

The management accounts and information show growing revenue for October and the first half of November, at slightly improved margins. Bad debts have been below our expectations but will remain a concern over the next few months. We are seeing insurance cover withdrawn or reduced on a number of customers. Trading levels have been exceptionally volatile this year and business confidence is very fragile. This makes it very difficult to predict far into the future.

Peter Latham

Chairman

29 November 2012

JAMES LATHAM PLC
CONSOLIDATED BALANCE SHEET
At 30 September 2012
	As at 30 Sept. 2012 unaudited	As at 30 Sept. 2011 unaudited	As at 31 March 2012 audited
	£000	£000	£000
ASSETS
Non-current assets
Goodwill	237	237	237
Intangible assets	120	127	123
Property, plant and equipment	22,662	21,588	22,673
Deferred tax asset	420	-	-
Total non-current assets	23,439	21,952	23,033
Current assets
Inventories	25,160	25,399	24,829
Trade and other receivables	31,290	32,212	29,133
Cash and cash equivalents	5,171	3,881	7,004
Non-current assets held for sale	-	-	758
Total current assets	61,621	61,492	61,724
Total assets	85,060	83,444	84,757
Current liabilities
Trade and other payables	18,851	20,094	20,207
Current portion of interest bearing loans and borrowings	207	340	1,161
Current tax payable	911	987	760
Total current liabilities	19,969	21,421	22,128
Non-current liabilities
Interest bearing loans and borrowings	2,308	3,347	2,403
Retirement and other benefit obligation	14,924	12,479	12,316
Other payables	613	676	641
Deferred tax liabilities	-	819	345
Total non-current liabilities	17,845	17,321	15,705
Total liabilities	37,814	38,742	37,833
Net assets	47,246	44,702	46,924
Capital and reserves
Issued capital	5,040	5,040	5,040
Share-based payment reserve	84	111	144
Own shares	(256)	(359)	(356)
Capital reserve	3	3	3
Retained earnings	42,375	39,907	42,093
Total equity attributable to equity shareholders of the parent company	47,246	44,702	46,924
JAMES LATHAM PLC
CONSOLIDATED INCOME STATEMENT
For the six months to 30 September 2012
	Six months to 30 Sept. 2012 unaudited	Six months to 30 Sept. 2011 unaudited	Year  to    31 March 2012 audited
	£000	£000	£000
Revenue	74,789	74,207	143,645
Cost of sales (including warehouse costs)	(61,689)	(61,091)	(118,564)
Gross profit	13,100	13,116	25,081
Selling and distribution costs	(6,081)	(5,872)	(11,687)
Administrative expenses	(2,741)	(2,892)	(5,702)
Other operating income	5	30	31
	(8,817)	(8,734)	(17,358)
Operating profit	4,283	4,382	7,723
Profit on disposal of property, plant and equipment	257	-	-
Finance income	13	26	43
Finance costs	(508)	(249)	(580)
Profit before tax	4,045	4,159	7,186
Tax expense	(891)	(1,086)	(1,116)
Profit after tax attributable to owners of the parent company	3,154	3,073	6,070
Earnings  per ordinary share (basic)	16.4p	16.1p	31.9p
Earnings  per ordinary share (diluted)	16.3p	15.9p	31.4p
All results relate to continuing operations.

JAMES LATHAM PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six months to 30 September 2012
	Six months to 30 Sept. 2012 unaudited	Six months to 30 Sept. 2011 unaudited	Year to   31 March 2012 audited
	£000	£000	£000
Profit after tax	3,154	3,073	6,070
Other Comprehensive income
Actuarial losses on defined benefit pension scheme	(2,738)	(4,171)	(4,304)
Deferred tax relating to components of other comprehensive income	765	1,081	973
Other comprehensive income for the period, net of tax	(1,973)	(3,090)	(3,331)
Total comprehensive income, attributable to owners of the parent company	1,181	(17)	2,739

JAMES LATHAM PLC
CONSOLIDATED CASH FLOW STATEMENT
For the six months to 30 September 2012
	Six months to 30 Sept 2012 unaudited	Six months to 30 Sept 2011 unaudited	Year to  31 March 2012 audited
	£000	£000	£000
Net cash flow from operating activities
Cash generated from operations	1,249	150	7,039
Interest paid	(469)	(210)	(48)
Income tax paid	(740)	(1,115)	(1,954)
Net cash inflow/(outflow) from operating activities	40	(1,175)	5,037
Cash flows from investing activities
Interest received and similar income	13	15	50
Purchase of property, plant and equipment	(564)	(3,560)	(5,922)
Proceeds from sale of property, plant and equipment	1,050	9	25
Net cash inflow/(outflow) from investing activities	499	(3,536)	(5,847)
Cash flows before financing activities
Finance leases repaid	-	(11)	(11)
Borrowings repaid during the period	(1,049)	-	(168)
Borrowings received during the period	-	2,700	2,700
Equity dividends paid	(1,284)	(1,171)	(1,741)
Preference dividend paid	(39)	(39)	(79)
Net cash (outflow)/inflow from financing activities	(2,372)	1,479	701
Decrease in cash and cash equivalents for the period	(1,833)	(3,232)	(109)
Cash and cash equivalents at beginning of the period	7,004	7,113	7,113
Cash and cash equivalents at end of the period	5,171	3,881	7,004

JAMES LATHAM PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
	Issued capital £000	Share-based payment reserve £000	Own shares £000	Capital reserve £000	Retained earnings £000	Total equity £000
As at 1 April 2011	5,040	79	(401)	3	41,095	45,816
Profit for the year	-	-	-	-	6,070	6,070
Other comprehensive income:
Actuarial loss on defined pension scheme	-	-	-	-	(4,304)	(4,304)
Deferred tax relating to components of other comprehensive income	-	-	-	-	973	973
Total comprehensive income for the year	-	-	-	-	2,739	2,739
Transaction with owners:
Dividends	-	-	-	-	(1,741)	(1,741)
Change in investment in ESOP shares	-	-	45	-	-	45
Share-based payment expense	-	65	-	-	-	65
Total transactions with owners	-	65	45	-	(1,741)	(1,631)
Balance at 31 March 2012	5,040	144	(356)	3	42,093	46,924
Profit for the period	-	-	-	-	3,154	3,154
Other comprehensive income:
Actuarial loss on defined benefit pension scheme	-	-	-	-	(2,738)	(2,738)
Deferred tax relating to components of other comprehensive income	-	-	-	-	765	765
Total comprehensive income for the period	-	-	-	-	1,181	1,181
Transactions with owners:
Dividends	-	-	-	-	(1,284)	(1,284)
Transfer of treasury shares	-	-	(562)	-	562	-
Conversions of ESOP shares	-	-	259	-	(259)	-
Exercise of options	-	(82)	-	-	82	-
Change in investment in ESOP shares	-	-	403	-	-	403
Share-based payment expense	-	22	-	-	-	22
Total transactions with owners	-	(60)	100	-	(899)	(859)
Balance at 30 September 2012	5,040	84	(256)	3	42,375	47,246

JAMES LATHAM PLC
NOTES TO THE HALF YEARLY REPORT
1. The results presented in this report are unaudited and they have been prepared in accordance with the recognition and measurement of International Financial Reporting Standards ('IFRS') as adopted by the EU that are expected to be applicable to the financial statements for the year ended 31 March 2013 and on the basis of the accounting policies to be used in those financial statements.  The figures for the year ended 31 March 2012 are extracted from the statutory accounts of the group for that period.
2.  The directors propose an interim dividend of 3.1p per ordinary share which will absorb £600,000 (2012: 3.0p absorbing £571,000), payable on 23 January 2013 to shareholders on the Register at the close of business on 4 January 2013. The ex-dividend date is 2 January 2013.
3. This half yearly report does not constitute statutory financial accounts within the meaning of section 434 of the Companies Act 2006. The statutory accounts for the year ended 31 March 2012 were prepared and filed with the Registrar of Companies. The audit report on those financial statements was not qualified and did not contain a reference to any matters which the auditor drew attention by way of an emphasis without qualifying the report and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. The half yearly report has not been audited by the company's auditors.
4.  Earnings per ordinary share is calculated by dividing the net profit for the year attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the year.
	Six months to 30 Sept 2012 unaudited		Six months to 30 Sept 2011 unaudited	Year to 31 March 2012 audited
	£000		£000	£000
Net profit attributable to ordinary shareholders	3,154		3,073	6,070
	Number '000		Number '000	Number '000
Weighted average share capital	19,207		19,038	19,044
Add: diluted effect of share capital options issued	111		270	268
Weighted average share capital for diluted earnings per ordinary share calculation		19,318	19,308	19,312
5.  Net cash flow from operating activities Six months to 30 Sept 2012 unaudited Six months to 30 Sept 2011 unaudited Year to 31 March 2012 audited Operating profit 4,283 4,382 7,723 Depreciation and impairment 575 460 985 (Profit)/loss on disposal of property, plant and equipment (32) 43 25 Increase in inventories (331) (628) (58) Increase in receivables (2,157) (3,676) (615) Decrease in payables (1,384) (252) (173) Own shares non cash amounts 403 42 45 Retirement benefits non cash amounts (130) (253) (958) Share-based payments non cash amounts 22 32 65 Cash generated from operations 1,249 150 7,039
6.  Copies of this statement will be posted on our website, www.lathams.co.uk . A copy can be emailed or posted upon application to the Company Secretary, James Latham plc, Unit 3 Swallow Park, Finway Road, Hemel Hempstead, HP2 7QU, or by email to [e-mail]

 

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