Interim Results
MS International PLC
29 November 2005
MS INTERNATIONAL plc
EXECUTIVE DIRECTORS
Michael Bell
Michael O'Connell
David Pyle
NON EXECUTIVE
Roger Lane-Smith
SECRETARY
David Pyle
REGISTERED OFFICE
Balby Carr Bank
Doncaster
DN4 8DH
PRINCIPAL OPERATING DIVISIONS
Defence
Forgings
Petrol Station Forecourt Structures
JOINT VENTURE
Global-MSI plc
Chairman's Statement
I am pleased to report that the year has started well, reflecting the continuing
strength of the markets we serve. In addition, our commitment to investing in
the business, through both capital investment and product development
programmes, continued to serve us well and placed us in a good position to take
advantage of the many global opportunities available to us. The outcome was
escalating levels of activity that culminated in both higher revenues and
profits for the Group.
A profit before taxation of £2.00m (2004 - £1.54m) was achieved on revenue of
£19.30m (2004 - £16.41m) for the twenty-six weeks to 29 October 2005. Earnings
per share were 8.1p (2004 - 5.4p).
The three operating divisions - defence, forgings and petrol station forecourt
structures - each achieved higher revenue and enhanced profitability,
highlighting the improving quality of the underlying substance and operating
performances of the individual businesses.
The cumulative value of the Group's order book has grown progressively in line
with the upturn in business activity that coincided with some superior
production processes coming on stream.
In September, the order book was enhanced significantly when the UK Ministry of
Defence (MoD) announced that it had awarded the Company a £15m contract to
up-grade a first batch of twenty-four of our in-service MSI-DS 30mm naval gun
systems. Since 2000 it has been evident that the MoD required an effective
solution to reduce the vulnerability of warships operating in littoral waters
from armed combatants approaching vessels by using small, fast civil craft.
Following three years of research and the development of a trials demonstrator,
the Royal Navy, in 2003, conducted comprehensive sea trials of the MSI solution.
The up-grade, which incorporates innovative sensor and tracking technology in a
reconfigured design, was down-selected by the MoD as the most efficient and cost
effective solution proposed, when compared to other offerings from international
competitors. Deliveries commence in 2006 and will be phased over a number of
years.
During the half year the Company purchased 50,000 MS INTERNATIONAL plc shares
for cancellation, at a total cost of £60,000. At the end of the half-year, net
borrowings amounted to £420,000.
I advised shareholders in my last annual statement that the Board was
considering a move to the AIM market. After further review the Board is of the
opinion that such a move would not necessarily provide a more appropriate option
to the main exchange and therefore we do not currently propose a change.
The Board remains cautiously optimistic that the levels of trading will continue
through the remainder of the year. These matters considered the Board has
declared an interim dividend of 0.58p per share (2004 - 0.50p).
Michael Bell 28th November 2005
MS INTERNATIONAL plc
Basis of Preparation
These interim financial statements, which have been prepared on the basis of the
accounting policies set out in the announcement restating financial information
under International Financial Reporting Standards (copies of which are available
from the Company Secretary, on request), do not constitute statutory accounts
within the meaning of section 254 of the Companies Act 1985 and are unaudited.
The figures for the year ended 30th April, 2005 do not constitute the Company's
statutory accounts for that period but have been extracted from the statutory
accounts and then translated into International Financial Reporting Standards.
The auditor's report on those accounts, which have been filed with the Registrar
of Companies, was unqualified and did not contain any statement under section
237(2) or (3) of the Companies Act 1985.
Consolidated Income Statement
26 weeks ended 26 weeks ended 52 weeks ended
29th Oct. 2005 30th Oct. 2004 30th April 2005
£'000 £'000 £'000
Group revenue 19,301 16,408 32,195
Profit before interest and taxation 1,570 1,293 2,921
Interest receivable - 35 37
Interest payable (39) (20) (38)
Share of profit of joint venture 464 236 369
Profit before taxation 1,995 1,544 3,289
Taxation (638) (519) (1,046)
Profit for the period attributable to equity
holders of the parent 1,357 1,025 2,243
Earnings per share - basic 8.1p 5.4p 12.4p
Earnings per share - diluted 7.7p 5.0p 11.5p
MS INTERNATIONAL plc
Statement of Recognised Income and Expenses
26 weeks 26 weeks 52 weeks
ended 29th Oct. ended 30th ended 30th
2005 Oct. 2004 April 2005
£'000 £'000 £'000
Actuarial gains/(losses) on defined benefit pension 636 23 (203)
scheme
Deferred taxation on actuarial gains/losses on defined (191) (7) 61
benefit pension scheme
Currency translation differences on foreign investments 52 (8) 7
Profit attributable to equity holders of the parent 1,357 1,025 2,243
Total recognised income and expenses for the period 1,854 1,033 2,108
Notes
1. Taxation on profit has been calculated at 32% (2004 - 34%) on the Group profit for the period as adjusted for
taxation purposes, and includes a charge of £125,000 in respect of the joint venture (2004 - £64,000)
2. The Board has declared an interim dividend of 0.58p per share. Dividend warrants will be posted on 27th
January, 2006 to members registered on the books of the Company at 6th January, 2006
3. On the 3rd October, 2005, the Company redeemed 50,000 of its own ordinary shares at a market price of 120 1/2p
MS INTERNATIONAL plc
Consolidated Balance Sheet
26 weeks ended 26 weeks ended 52 weeks ended
29th Oct. 2005 30th Oct. 2004 30th April 2005
£'000 £'000 £'000
ASSETS
Non current assets
Property, plant and equipment 8,412 8,030 8,299
Intangible assets 275 326 323
Investment in joint venture 1,047 596 708
Deferred income tax asset 301 505 514
10,035 9,457 9,844
Current assets
Inventories 4,906 5,190 5,511
Trade and other receivables 6,421 6,552 5,030
Prepayments 609 102 360
Cash and cash equivalents - 1,454 1,013
11,936 13,298 11,914
TOTAL ASSETS 21,971 22,755 21,758
EQUITY AND LIABILITIES
Equity
Issued capital 1,881 1,969 1,886
Capital redemption reserve 860 772 855
Revaluation reserve 1,544 1,544 1,544
Special reserve 1,629 1,629 1,629
Foreign exchange reserve (126) (185) (178)
Own shares (738) (738) (738)
Retained earnings 2,022 240 556
7,072 5,231 5,554
Non current liabilities
Pension liability 4,337 4,787 5,039
Loans and borrowings 4 42 5
Provisions 146 243 178
Government grants 46 60 52
4,533 5,132 5,274
Current liabilities
Trade and other payables 9,201 11,366 10,145
Loans and borrowings 67 422 249
Provisions 65 164 65
Government grants 13 13 13
Income tax payable 600 427 458
Cash and cash equivalents 420 - -
10,366 12,392 10,930
TOTAL EQUITY AND LIABILITIES 21,971 22,755 21,758
MS INTERNATIONAL plc
Consolidated Cash Flow Statement
26 weeks ended 26 weeks ended 52 weeks ended
29th Oct. 2005 30th Oct. 2004 30th April 2005
£'000 £'000 £'000
Net Cash (Outflow)/Inflow from Operating Activities (253) 13 1,265
Investing activities
Dividends received from joint venture - 200 200
Purchase of intangible fixed assets (8) (46) (46)
Purchase of tangible fixed assets (750) (443) (1,204)
Sale of tangible fixed assets 97 - 22
Net Cash Used in Investing Activities (661) (289) (1,028)
Financing activities
Purchase of own shares (60) (669) (1,325)
Dividends paid (276) (250) (338)
Repayment of bank loan (139) (167) (333)
Repayment of capital element of finance leases (44) (103) (147)
Net Cash Flow from Financing Activities (519) (1,189) (2,143)
Movement in cash and cash equivalents (1,433) (1,465) (1,906)
Opening cash and cash equivalents 1,013 2,919 2,919
Closing cash and cash equivalents (420) 1,454 1,013
MS INTERNATIONAL plc
Reconciliation of Movement in Equity
Share Capital Revaluation Foreign Special Own Retained Total
Capital Redemption reserve exchange reserve Shares Earnings
reserve reserve
At 30th October, 2004 1,969 772 1,544 (185) 1,629 (738) 240 5,231
Profit attributable to - - - - - - 1,218 1,218
equity holders of the
parent
Dividends - - - - - - (88) (88)
Actuarial losses on - - - - - - (226) (226)
deferred benefit pension
scheme
Deferred taxation on - - - - - - 68 68
actuarial losses
Foreign exchange - - - 7 - - - 7
adjustments in
retranslation of overseas
investments
Repurchase of own shares (83) 83 - - - - (656) (656)
At 30th April 2005 1,886 855 1,544 (178) 1,629 (738) 556 5,554
Profit attributable to - - - - - - 1,357 1,357
equity holders of the
parent
Dividends - - - - - - (276) (276)
Actuarial profits on - - - - - - 636 636
defined benefit pension
scheme
Deferred taxation on - - - - - - (191) (191)
actuarial profits
Foreign exchange - - - 52 - - - 52
adjustments in
retranslation of overseas
investments
Repurchase of own shares (5) 5 - - - - (60) (60)
At 29th October 2005 1,881 860 1,544 (126) 1,629 (738) 2,022 7,072
MS INTERNATIONAL plc
Net Cash (Outflow)/Inflow from Operating Activities
26 weeks ended 26 weeks ended 52 weeks ended
29th Oct. 2005 30th Oct. 2004 30th April 2005
£'000 £'000 £'000
Profit before interest and taxation 1,570 1,293 2,921
Depreciation 552 418 891
Amortisation of intangible fixed assets 47 - -
Foreign exchange gains/(losses) 52 (16) (13)
Government grant release (6) (5) (13)
Provisions utilised (32) (33) (197)
Pension charge 176 140 414
Profit on sale of fixed assets (4) - -
Decrease/(increase) in inventories 1,433 (1,101) (2,743)
(Increase)/decrease in receivables (1,331) (499) 1,123
(Increase)/decrease in prepayments (309) 296 38
(Decrease)/increase in payables (529) 560 (514)
(Decrease)/increase in progress payments (1,243) (359) 705
Increase in provisions - 48 48
Pension fund payments (242) (381) (630)
Cash generated from operations 134 361 2,030
Interest (paid)/received (39) 13 (2)
Taxation paid (348) (361) (763)
Net cash (outflow)/inflow from operating activities (253) 13 1,265
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