Interim Results

RNS Number : 0556Z
Renew Holdings PLC
24 May 2016
 

 

Renew Holdings plc

("Renew" or the "Group" or the "Company")

 

Interim Results

 

Renew (AIM: RNWH), the Engineering Services Group supporting UK infrastructure, announces record interim results for the six months ended 31 March 2016. With a strong order book and expected revenue for H2 already fully secured, the Company is increasing its interim dividend in line with its progressive policy by 18% to 2.65p.

 

Financial Highlights

 

H1 2016

H1 2015

 

Revenue

£265.1m

£252.1m

+5%

Adjusted operating profit*

£10.5m

£9.8m

+7%

Adjusted operating margin*

4.0%

3.9%

+ 3%

Adjusted profit before tax*

£10.3m

£9.5m

+9%

Adjusted earnings per share*

13.31p

12.24p

+9%

Interim dividend per share

2.65p

2.25p

+18%

*Adjusted results are stated prior to amortisation charges

 

Operational Highlights

·     Order book up 9% to £515m (H1 2015: £471m)

§ 9% increase in Engineering Services order book to £416m (H1 2015: £382m)

§ Expected revenue for H2 secured

·     Engineering Services revenue up 6% to £221.3m (2015: £209.8m)

§ 12% organic growth, excluding non-recurring revenue recorded in 2015

·     Further reduction in net debt to £4.2m (2015: £13.9m)

§ The Board expects to report net cash at the end of this financial year

·     Interim dividend increased by 18% to 2.65p per share (2015: 2.25p)

 

Board Changes

·     Brian May retires as Chief Executive on 30 September 2016

·     Paul Scott, currently Director of Engineering Services, will succeed Brian May

·     Board strengthened by appointment of Andries Liebenberg, Rail Managing Director

 

R J Harrison OBE, Chairman said: "Renew has delivered another strong set of financial results which demonstrate the success of the Board's strategy of direct delivery of engineering support services to the country's critical infrastructure. The Board expects further progress in the second half of the financial year and the Group is well positioned to achieve its target of a 4.5% Group operating margin for the year ended 30 September 2017."

 

Renew Holdings plc

                      Tel: 0113 281 4200

Brian May, Chief Executive

 

John Samuel, Group Finance Director

 

 

 

Numis Securities Limited

                      Tel: 020 7260 1000

Stuart Skinner/Kevin Cruickshank (Nominated Adviser)

 

Michael Burke (Corporate Broker)

 

 

 

Walbrook PR

                                       Tel: 020 7933 8780 or renew@walbrookpr.com

Paul McManus

Mob: 07980 541 893

Lianne Cawthorne

Mob: 07584 391 303

       

 

About Renew Holdings plc

 

Engineering Services, which accounts for approximately 85% of Group revenue and 90% of operating profit, focuses on the key markets of Energy (including Nuclear), Environmental and Infrastructure, which are largely governed by regulation and benefit from non-discretionary spend with long-term visibility of committed funding.

 

Specialist Building focuses on the High Quality Residential market in London and the Home Counties.

 

For more information please visit the Renew Holdings plc website: www.renewholdings.com                

 

 

Chairman's Statement

 

The Group has again delivered record interim results with further growth in both revenue and operating profit. The Group continues to see positive results from its strategy of focusing on providing essential engineering services into regulated markets where long-term maintenance and renewal requirements are funded mainly through operational expenditure budgets.

 

Results

 

Group operating profit, prior to amortisation charges, increased by 7% to £10.5m (2015: £9.8m), on revenue up 5% to £265.1m (2015: £252.1m). Operating margin measured on this basis increased to 4.0% (2015: 3.9%) with earnings per share prior to amortisation charges increasing by 9% to 13.31p (2015: 12.24p). Profit before income tax increased by 14% to £8.8m (2015: £7.7m).

 

In Engineering Services, revenue grew by 6% to £221.3m (2015: £209.8m), representing 84% (2015: 83%) of Group revenue with operating profit prior to amortisation charges increasing by 8% to £10.4m (2015: £9.7m), giving an improved operating margin of 4.7% (2015: 4.6%).

 

In Specialist Building, the Board continues to focus on contract selectivity and risk management. The business, which operates mainly in the High Quality Residential market in London and the Home Counties, delivered an operating profit of £1.1m (2015: £1.0m) on revenue of £44.4m (2015: £42.5m).

 

Dividend

 

In line with its progressive policy, the Board is increasing the interim dividend by 18% to 2.65p (2015: 2.25p) per share which will be paid on 4 July 2016 to shareholders on the register at 3 June 2016.

 

Order book

 

The Group's order book at 31 March 2016 increased by 9% to £515m (2015: £471m). The Group's expected revenue for the second half of the financial year is fully secured.

 

Cash

 

At 31 March 2016, the Group had net debt of £4.2m (2015: £13.9m). The Board expects to report a net cash position at the end of the financial year.

 

Board changes

 

In March 2016, Brian May announced his retirement as Chief Executive, effective 30 September 2016. Paul Scott, who is currently Director of Engineering Services, will succeed Brian. Paul joined the Board in 2014 and was previously Managing Director of the Group's principal nuclear business, Shepley Engineers Limited.

 

The Board was strengthened further by the appointment on 31 March 2016 of Andries Liebenberg, Managing Director of the Group's largest business, Amco Rail, which is a leading supplier of infrastructure services to Network Rail.

 

Outlook

 

The Group continues to make good progress as a leading provider of engineering support services in the UK's Energy, Environmental and Infrastructure markets. The requirement for long-term maintenance and renewal activities drives programmes of non-discretionary spending in our target markets, often over several years, which provides good visibility of future workload with committed funding.

 

It remains the Board's strategy to grow our Engineering Services business, both organically and through selective earnings enhancing acquisitions. The growth in our order book and good cash generation gives the Board confidence that the Group will deliver strong results for the full financial year. Renew remains on track to achieve its target of a 4.5% Group operating margin for the year ending 30 September 2017. 

 

R J Harrison OBE

Chairman

 

24 May 2016

 

 

 

 

 

 

Chief Executive's Review

 

As a leading provider of engineering services supporting critical UK infrastructure, Renew operates in the Energy, Environmental and Infrastructure markets. These mainly regulated markets, which include nuclear and fossil power generation sites, water and gas pipelines and the rail and wireless telecoms networks, have high barriers to entry.

 

Engineering Services

 

During the first half of the financial year, Engineering Services revenue grew by 6% to £221.3m (2015: £209.8m) and accounted for 84% (2015: 83%) of Group revenue. When non-recurring revenue recorded in 2015 is excluded, organic growth was 12%. Operating profit prior to amortisation increased by 8% to £10.4m (2015: £9.7m) with an operating margin of 4.7% (2015: 4.6%) with further improvement expected in the second half of the financial year.

 

At 31 March 2016, the Engineering Services order book was £416m (2015: £382m), an increase of 9%.

 

Energy

 

Renew provides integrated engineering support to assets in the nuclear, fossil, gas and renewable energy markets.

 

In Nuclear, the Group is active on 14 of the Nuclear Decommissioning Authority's 17 nuclear licenced sites across the UK. The majority of our work is undertaken at the Sellafield nuclear site in Cumbria where we have operated for almost 70 years and are the largest mechanical and electrical contractor on site. Our work is delivered through 11 framework agreements focusing on the long-term care and maintenance of operational plant in the waste treatment or reprocessing, decommissioning, demolition and clean up operations.

 

We continue to develop our range of integrated engineering services and recently expanded our capabilities with the acquisition of Nuclear Decontamination Services Limited, which operates at Sellafield as well as other UK nuclear sites.

 

The strength of our relationships at Sellafield is evidenced by our recent appointment to the major 10-year Decommissioning Delivery Partnership Framework which has an estimated value of £500m over the term. This framework is an essential part of Sellafield's long-term decommissioning strategy and includes provision for additional spend up to £1.5bn.

 

We continue to see good volumes of work on the established Multi Discipline Site Works Framework which runs to 2017 and is aligned to the largest scope of work at the Sellafield site, Production Operations Support. Other frameworks include the Bulk Sludge Retrieval programme, Site Remediation & Decommissioning Projects and the Bundling Spares Framework.

 

Working nationally for Magnox, the UK's largest nuclear decommissioning company, we operate as sole provider on the £30m E, C&I framework, recently completing the first year of this 4-year framework. Elsewhere, we have increased our workload with Westinghouse at Springfields where we have operated for over 20 years and we continue to be engaged in outage support at the Heysham and Hartlepool reactor sites.

 

In gas, our addressable market on the 30/30 Iron Mains Replacement Programme, which runs to 2032, is both substantial and visible. As I reported last year, revenue flow from frameworks for the delivery of these programmes has been slow and as a result this business has continued to perform below our expectations. Increasingly, our focus is on the large diameter medium pressure market in London where our particular skills are highly valued by our clients.

 

Environmental

 

We provide maintenance, renewal and emergency reactive services to support water and sewer infrastructure, flood alleviation and coastal protection works.

 

For Northumbrian Water, we operate as one of two providers on the £14m per annum AMP 6 Sewerage Repairs and Maintenance Framework. Work is also undertaken on the Major Waste Water, Clean Water and Maintenance and Trunk Mains Cleaning frameworks.

 

We have maintained our strong relationship with Wessex Water with our appointment to the AMP 6 Civils and EMI Delivery Partners Framework. This arrangement, which runs to 2020, is estimated at £350m over the term with potential for extension through the next AMP 7 period. In addition, we remain involved on their new Integrated Grid programme as well as on a range of civil engineering schemes.  

 

Our long established relationship with Welsh Water continues with work being delivered via the Pressurised Pipelines Framework, the Major Civils Framework and the Emergency Reactive framework.   

 

The first half of the year has seen good progress on the Environment Agency's £10m MEICA Framework which covers flood and water management sites throughout the Northern Region to 2019. In addition, works have commenced to repair the electrical system at the Fosse Barrier in York following our provision of emergency support during the winter flooding. Work is also undertaken nationally for the Environment Agency on four minor works frameworks.

 

In Land Remediation, we work for National Grid on a number of frameworks. During the period, we have also secured an £11m contract at Sighthill for Glasgow City Council.

 

Our long running specialist restoration activity at the Palace of Westminster is progressing with work well advanced on the second of four projects on the Cast Iron Roof programme. In the period we were also appointed to the four year Courtyards Conservation framework at this site.

 

Infrastructure

 

As one of the leading infrastructure services providers to Network Rail, we undertake off-track planned, reactive and emergency maintenance and renewal works.

 

We are sole provider on seven Infrastructure Projects frameworks with an advertised value of £450m over the five-year term of the current CP5 investment period. We also undertake high volumes of individual tasks through six Asset Management frameworks. These cover a wide range of essential assets including bridges, tunnels and embankments. We continue to develop our position as the major structures renewals and sole maintenance contractor in Scotland and notable schemes have included coastal line protection works at Saltcoats.

 

Our locally based delivery teams provide a 24/7 emergency response service on the rail network. The severe weather around the turn of the year saw our teams respond to critical infrastructure requirements for Network Rail. This included emergency works at Lamington Viaduct in the Upper Clyde Valley where the main line from Carlisle to Glasgow was closed for several weeks to repair extensive damage caused by flooding.  We returned the line to operation ahead of schedule.

 

New awards include the three-year, £15m Historic Railways Estate Works framework for Highways England.

 

In wireless telecoms we work for the UK's cellular network operators and original equipment manufacturers. The corporate M&A activity in this market during 2015 caused volatility and adversely impacted our financial performance. Whilst the business has not yet returned to deliver our originally expected level of margin, it has traded profitably and in line with budget in the first half of this financial year. Consumer demand for faster, more capable mobile connectivity is driving the installation and expansion of 4G services which continues to provide the majority of our work.

Specialist Building

 

The Group has particular expertise and focuses on the major structural engineering works required in many High Quality Residential refurbishment projects in London and the Home Counties.

 

In the first half of the financial year Specialist Building revenue was £44.4m (2015: £42.5m), with an operating profit of £1.1m (2015: £1.0m). The forward order book increased by 11% to £99m (2015: £89m).  This market remains robust and the Group has fully secured revenue for the second half of this financial year with very good visibility of workload through 2017.

 

Strategy

 

We continue to pursue our strategy of maximising organic growth whilst seeking further earnings enhancing acquisitions. Our independently branded subsidiary businesses deliver a large volume of tasks across critical infrastructure networks, supporting their day-to-day operation. Delivering planned and emergency maintenance services for our clients with our responsive, directly employed workforce provides a key differentiator in our markets, producing growth opportunities.

 

 

Brian May

Chief Executive

 

24 May 2016

 

 

 

 

 

Group income statement

for the six months ended 31 March 2016

 

 

 

 

Before amortisation of intangible assets

 

Amortisation of intangible assets

 

Six months ended

31 March

Before amortisation of intangible assets

Amortisation of intangible assets

Year ended

30 September

 

 

 

 

 

 

 

 

 

 

 

2016

2016

2016

2015

 

2015

 

2015

 

2015

 

 

Note

 

Unaudited

£000

 

Unaudited

£000

 

Unaudited

£000

 

        Unaudited

£000

Audited

£000

Audited

£000

 Audited

£000

 

 

 

 

 

 

 

 

 

Group revenue from continuing activities

2

265,079

-

265,079

252,148

519,645

-

519,645

Cost of sales

 

(234,261)

-

(234,261)

(221,749)

(462,154)

-

(462,154)

Gross profit

 

30,818

-

30,818

30,399

57,491

-

57,491

Administrative expenses

 

(20,340)

(1,477)

(21,817)

(22,343)

(37,121)

(3,536)

(40,657)

Operating profit

2

10,478

(1,477)

9,001

8,056

20,370

(3,536)

16,834

Finance income

 

131

-

131

124

27

-

27

Finance costs

 

(333)

-

(333)

(518)

(939)

-

(939)

Other finance income - defined benefit pension schemes

 

 

-

-

-

49

189

-

189

Profit before income tax

2

10,276

(1,477)

8,799

7,711

19,647

(3,536)

16,111

Income tax expense

4

(2,026)

266

(1,760)

(1,581)

(3,579)

636

(2,943)

Profit for the period from continuing activities

 

 

8,250

(1,211)

7,039

6,130

16,068

(2,900)

13,168

Loss for the period from discontinued operations

3

 

 

-

-

 

 

(7,263)

Profit for the period attributable to equity holders of the parent company

 

 

 

7,039

6,130

 

 

5,905

 

 

 

 

 

 

 

 

 

Basic earnings per share from continuing activities

5

 

 

11.35p

9.96p

 

 

21.34p

Diluted earnings per share from continuing activities

5

 

 

11.26p

9.84p

 

 

21.06p

 

 

 

 

 

 

 

 

 

Basic earnings per share

5

 

 

11.35p

9.96p

 

 

9.57p

Diluted earnings per share

5

 

 

11.26p

9.84p

 

 

9.44p

 

 

 

 

 

 

 

 

 

Proposed dividend

6

 

 

2.65p

2.25p

 

 

7.00p

 

 

*Operating profit for the six months ended 31 March 2015 is stated after charging £1,749,000 of amortisation cost.

 

 

 

Group statement of comprehensive income

for the six months ended 31 March 2016

 

 

Six months ended

Year ended

 

 

31 March

30 September

 

 

2016

2015

2015

 

 

 

 

 

 

 

Unaudited

Unaudited

Audited

 

 

£000

£000

 £000

 

 

 

 

 

Profit for the period attributable to equity holders of the parent company

 

7,039

6,130

5,905

Items that will not be reclassified to profit or loss:

 

 

 

 

Movement in actuarial valuation of the defined benefit pension schemes

 

-

-

8,880

Movement on deferred tax relating to the defined benefit pension schemes

 

-

-

(1,570)

Total items that will not be reclassified to profit or loss

 

-

-

7,310

Items that are or may be reclassified subsequently to profit or loss:

 

 

 

 

Exchange movement in reserves

 

135

261

304

Total items that are or may be reclassified subsequently to profit or loss

 

135

261

 

304

Total comprehensive income for the period attributable to equity holders of the parent company

 

7,174

6,391

 

13,519

 

 

 

 

 

 

Group statement of changes in equity

for the six months ended 31 March 2016

 

                       

Called up

Share

Capital

Cumulative

Share based

 

Total

 

share

premium

redemption

translation

payments

Retained

equity

 

capital

account

reserve

adjustment

reserve

earnings

Unaudited

 

£000

£000

£000

£000

£000

£000

£000

 

 

 

 

 

 

 

 

At 1 October 2014

6,152

5,942

3,896

752

292

(3,160)

13,874

Transfer from income statement for the period

 

 

 

 

 

6,130

6,130

Dividends paid

 

 

 

 

 

(2,153)

(2,153)

New shares issued

40

1,047

 

 

 

 

1,087

Recognition of share based payments

 

 

 

 

(85)

 

(85)

Exchange differences

 

 

 

261

 

 

261

At 31 March 2015

6,192

6,989

3,896

1,013

207

817

19,114

Transfer from income statement for the period

 

 

 

 

 

(225)

(225)

Dividends paid

 

 

 

 

 

(1,393)

(1,393)

Recognition of share based payments

 

 

 

 

120

 

120

Exchange differences

 

 

 

43

 

 

43

Actuarial gains recognised in pension schemes

 

 

 

 

 

8,880

8,880

Movement on deferred tax relating to the pension schemes

 

 

 

 

 

 

(1,570)

 

(1,570)

At 30 September 2015

6,192

6,989

3,896

1,056

327

6,509

24,969

Transfer from income statement for the period

 

 

 

 

 

7,039

7,039

Dividends paid

 

 

 

 

 

(2,960)

(2,960)

New shares issued

40

1,492

 

 

 

 

1,532

Recognition of share based payments

 

 

 

 

11

 

11

Exchange differences

 

 

 

135

 

 

135

At 31 March 2016

6,232

8,481

3,896

1,191

338

10,588

30,726

 

 

 

 

 

 

Group balance sheet 

at 31 March 2016

 

 

 

          31 March

 

 

2016

2015

 

 

 

(Restated*)

 

 

Unaudited

Unaudited

 

 

£000

£000

Non-current assets

 

 

 

Intangible assets

 

 

 

- goodwill

 

56,260

56,060

- other

 

2,757

6,021

Property, plant and equipment

 

14,095

12,958

Retirement benefit assets

 

17,284

3,136

15,154

Deferred tax assets

 

1,673

2,941

1,718

 

 

92,069

81,116

90,267

Current assets

 

 

 

 

Inventories

 

5,077

4,559

Trade and other receivables

 

94,452

100,962

Assets held for resale

 

1,567

-

Current tax assets

 

1,389

-

Cash and cash equivalents

 

8,192

4,705

 

 

110,677

110,226

114,673

 

 

 

 

Total assets

 

202,746

191,342

204,940

 

 

 

 

Non-current liabilities

 

 

 

Borrowings

 

(6,200)

(12,400)

Obligations under finance leases

 

(2,134)

(2,831)

Retirement benefit obligations

 

(407)

-

Deferred tax liabilities

 

(3,654)

(1,190)

Provisions

 

(580)

(1,232)

(1,232)

 

 

(12,975)

(17,653)

(17,182)

Current liabilities

 

 

 

Borrowings

 

(6,200)

(6,200)

Trade and other payables

 

(149,881)

(144,822)

Obligations under finance leases

 

(2,944)

(2,519)

Current tax liabilities

 

-

(666)

Provisions

 

(20)

(368)

 

 

(159,045)

(154,575)

(162,789)

 

 

 

 

Total liabilities

 

(172,020)

(172,228)

 

 

 

 

 

Net assets

 

30,726

19,114

24,969

 

 

 

 

 

Share capital

 

6,232

6,192

Share premium account

 

8,481

6,989

Capital redemption reserve

 

3,896

3,896

Cumulative translation adjustment

 

1,191

1,013

Share based payments reserve

 

338

207

Retained earnings

 

10,588

817

6,509

Total equity

 

30,726

19,114

24,969

 

*2015 comparative balance sheet has been restated to reflect fair value adjustments recognised in the year ended 30 September 2015 statutory accounts.

 

Group cashflow statement

for the six months ended 31 March 2016

 

 

     Six months ended     

Year ended 

 

       31 March

30 September

 

2016

2015

2015

 

 

 

 

 

Unaudited

Unaudited

Audited

 

£000

£000

 £000

 

 

 

 

Profit for the period from continuing operations

7,039

6,130

13,168

Amortisation of intangible assets

1,477

1,749

3,536

Depreciation

1,968

2,152

3,927

Profit on sale of property, plant and equipment

(275)

(60)

(278)

Charge in respect of share option exercise

1,532

1,087

1,087

Increase in inventories

(91)

(355)

(586)

Increase in receivables

(2,063)

(15,215)

(14,191)

Increase in payables

253

11,678

18,741

Current service cost in respect of defined benefit pension scheme

29

29

248

Cash contribution to defined benefit schemes

(2,322)

(1,680)

(4,279)

Charge/(credit) in respect of share options

11

(85)

35

Finance income

(131)

(124)

(27)

Finance costs and expense

333

469

750

Interest paid

(333)

(518)

(939)

Income taxes paid

(800)

(1,675)

(3,066)

Income tax expense

1,760

1,581

2,943

Net cash inflow from continuing operating activities

8,387

5,163

21,069

Net cash outflow from discontinued operating activities

(2,003)

(168)

(3,590)

Net cash inflow from operating activities

6,384

4,995

17,479

 

 

 

 

Investing activities

 

 

 

Interest received

131

124

27

Proceeds on disposal of property, plant and equipment

359

106

530

Purchases of property, plant and equipment

(1,471)

(585)

(1,454)

(Acquisition)/disposal of subsidiaries net of cash acquired

(208)

1,142

1,135

Net cash (outflow)/inflow from continuing investing activities

(1,189)

787

238

Net cash inflow from discontinued investing activities

-                          

168                          

162

Net cash (outflow)/inflow from investing activities

          (1,189)

             955

400

 

 

 

 

Financing activities

 

 

 

Dividends paid

(2,960)

(2,153)

(3,546)

Loan repayments

(3,100)

(3,100)

(6,200)

Repayment of obligations under finance leases

(1,620)

(1,585)

(3,067)

Net cash outflow from financing activities

(7,680)

(6,838)

(12,813)

 

 

 

 

Net (decrease)/increase in continuing cash and cash equivalents

(482)

(888)

8,494

Net decrease in discontinued cash and cash equivalents

(2,003)

-

(3,428)

Net (decrease)/increase in cash and cash equivalents

(2,485)

(888)

5,066

 

 

 

 

Cash and cash equivalents at the beginning of the period

10,662

5,586

5,586

Effect of foreign exchange rate changes

15

7

10

Cash and cash equivalents at the end of the period

8,192

4,705

10,662

 

 

 

 

Bank balances and cash

8,192

4,705

10,662

 

NOTES TO THE ACCOUNTS

 

Note 1 - Basis of preparation

 

(a) The consolidated interim financial report for the six months ended 31 March 2016 and the equivalent period in 2015 have not been audited or reviewed by the Group's auditor. They do not comprise statutory accounts within the meaning of Section 435 of the Companies Act 2006. They have been prepared under the historical cost convention and on a going concern basis in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union. This interim financial report does not comply with IAS34 "Interim Financial Reporting", which is not currently required to be applied for AIM companies.  This interim report was approved by the Directors on 24 May 2016.

                               

(b) The accounts for the year ended 30 September 2015 were prepared under IFRS and have been delivered to the Registrar of Companies. The report of the auditor on those accounts was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under Section 498(2) or (3) of the Companies Act 2006. In this report, the comparative figures for the year ended 30 September 2015 have been audited. The comparative figures for the period ended 31 March 2015 are unaudited.

 

(c) For the year ending 30 September 2016, there are no new accounting standards, which have been adopted by the EU, applied and implemented for this interim financial report.

 

(d) On 31 October 2014 Places for People Group Limited ("PFP") acquired 50% of the ordinary share capital of Allenbuild Ltd, a Specialist Building subsidiary.  PFP acquired the remaining 50% on 31 January 2016.  Consequently, Allenbuild Ltd has been treated as a discontinued business.

 

(e) The Directors are satisfied that the Group has adequate resources to continue in operational existence for the foreseeable future. 

 

This interim statement is being sent to all shareholders and is also available upon request from the Company Secretary, Renew Holdings plc, Yew Trees, Main Street North, Aberford, West Yorkshire LS25 3AA, or via the website www.renewholdings.com.

 

 

Note 2 - Segmental analysis                                                                                                                                                                                                                                                                                      

Operating segments have been identified based on the internal reporting information provided to the Group's Chief Operating Decision Maker. From such information, Engineering Services and Specialist Building have been determined to represent operating segments.               

                                                                                                                                                               

                  Six months ended

                       31 March

Year ended

30 September

 

 

2016

2015

2015

 

 

 

 

 

 

 

Unaudited

Unaudited

Audited

 

Revenue is analysed as follows:

£000

£000

 £000

 

Engineering Services

221,345

209,753

440,502

 

Specialist Building

44,375

42,477

79,492

 

Inter segment revenue

(641)

(82)

(380)

 

Segment revenue

265,079

252,148

519,614

 

Central activities

-

-

31

 

Group revenue from continuing operations

265,079

252,148

519,645

 

 

 

 

 

 

 

 

 

Before amortisation of intangible assets

 

Amortisation of intangible assets

Six months ended 31 March

Before amortisation of intangible assets

 

Amortisation of intangible assets

Year ended 30 September

 

2016

Unaudited

2016

Unaudited

2016

Unaudited

2015

Unaudited

2015

Audited

2015

Audited

2015

Audited

 

£000

£000

£000

£000

£000

£000

£000

Analysis of operating profit

 

 

 

 

 

 

 

Engineering Services

10,406

(1,477)

8,929

7,916

20,055

(3,536)

16,519

Specialist Building

1,054

-

1,054

1,046

2,274

-

2,274

Segment operating profit

11,460

(1,477)

9,983

8,962

22,329

(3,536)

18,793

Central activities

(982)

-

(982)

(906)

(1,959)

-

(1,959)

Operating profit

10,478

(1,477)

9,001

8,056

20,370

(3,536)

16,834

Net financing expense

    (202)

-

  (202)

  (345)

(723)

-

(723)

Profit before income tax

10,276

(1,477)

8,799

7,711

19,647

(3,536)

16,111

                     

 

*Operating profit for the six months ended 31 March 2015 is stated after charging £1,749,000 of amortisation cost.

 

 

Note 3 - Discontinued operations

 

                   Six months ended

 

Year ended

 

                       31 March

 

30 September

 

2016

 

2015

 

2015

 

Unaudited

 

Unaudited

 

Audited

 

         £000 

 

£000

 

£000

Revenue                                                                                     4,876                         19,343                            31,947

Expenses

(4,876)

 

 (19,343)

 

(41,278)

Profit on disposal

-

 

-

 

1,250

Loss before income tax

-

 

    -

 

(8,081)

Income tax credit - benefit of tax losses

-

 

-

 

818

Loss for the period from discontinued operations

-

 

-

 

(7,263)

 

  

 

Note 4 - Income tax expense

 

 

Six months ended

Year ended

 

31 March

30 September

 

2016

2015

2015

 

Unaudited

Unaudited

Audited

 

£000

£000

 £000

Current tax:

 

 

 

UK corporation tax on profits for the period

(1,598)

(1,646)

(2,360)

Adjustments in respect of previous periods

-

-

1,359

Total current tax

(1,598)

(1,646)

(1,001)

Deferred tax

(162)

65

(1,942)

Income tax expense

(1,760)

(1,581)

(2,943)

 

 

Note 5 - Earnings per share       

                  

                                                              Six months ended 31 March

Year ended 30 September

 

 

 

2016

 

 

 

 

2015

 

 

 

2015

 

 

 

 

Unaudited

 

 

 

Unaudited

 

 

 

Audited

 

 

Earnings

EPS

DEPS

 

Earnings

EPS

DEPS

 

Earnings

EPS

DEPS

 

£000

Pence

Pence

 

£000

Pence

Pence

 

£000

Pence

Pence

Earnings before amortisation

 

8,250

13.31

13.20

 

 

7,529

12.24

12.09

 

16,068

26.03

25.70

Amortisation

(1,211)

(1.96)

(1.94)

 

  (1,399)

(2.28)

(2.25)

 

(2,900)

(4.69)

(4.64)

Basic earnings per share - continuing operations

 

7,039

11.35

11.26

 

 

6,130

9.96

9.84

 

13,168

21.34

21.06

Loss for the period from discontinued operations

 

-

  -

-

 

 

-

  -

-

 

(7,263)

(11.77)

(11.62)

Basic earnings per share

7,039

11.35

11.26

 

6,130

9.96

9.84

 

5,905

          9.57

9.44

Weighted average number of shares

 

62,001

62,524

 

 

61,525

62,286

 

 

61,718

62,533

                                   

 

The dilutive effect of share options is to increase the number of shares by 523,000 (March 2015: 761,000; September 2015: 815,000) and reduce basic earnings per share by 0.09p (March 2015: 0.12p; September 2015: 0.13p).  On 15 January 2016, 400,000 new Ordinary shares of 10p each were issued following the exercise of share options bringing the total number in issue to 62,317,948.

 

 

Note 6 - Dividends                        

                               

The proposed interim dividend is 2.65p per share (2015: 2.25p).  This will be paid out of the Company's available distributable reserves to shareholders on the register on 3 June 2016, payable on 4 July 2016. In accordance with      IAS 1, dividends are recorded only when paid and are shown as a movement in equity rather than as a charge in the income statement.

 

 

 

 

 

 


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