Interim Results
Synstar PLC
30 May 2003
Friday 30 May 2003
Synstar plc
Interim Results 2003
Operating Profit from continuing operations up 16%
Proposal to initiate dividends at year-end
Synstar plc, the pan-European IT services provider, announces results for the
six months ended 31 March 2003.
Highlights
• Strong profit performance despite challenging market conditions -
Operating profit from continuing operations of £3.7m up 16% exceeding
market expectations
• Further success in selling multiple service lines to customers, for
example
• AWE, Cognotec, Corsair, Pfizer, BMW and Dutch Ministry of Defence
• Order book at £299m at period end (2002: £230m)
• Proposal to pay maiden dividend at year end
Financial performance
H1 2003 H1 2002 Change
Continuing operations
- Revenue £111.5m £109.9m +1%
- Gross Margin 26.1% 25.4% +3%
- Operating Profit £3.7m £3.2m +16%
Profit Before Tax £3.8m £3.1m* +23%
Earnings per Share 1.6p 1.3p* +23%
* before an exceptional loss on disposal of £1.5m
NB. 'Continuing Operations' excludes the Swiss subsidiary which was sold in
2002
John Leighfield, Chairman of Synstar, commented:
'I am pleased to report that Synstar has once again achieved the objectives we
set. As always, we have remained true to our over-riding principle of managing
the company for growth in profits and cash. This strategy has been particularly
important during a challenging period for the IT services market. The Board is
pleased to initiate paying a dividend to show its commitment to this strategy.'
Steve Vaughan, Chief Executive, said:
'The three year strategy that we set in motion at the start of 2001 was designed
to reposition and redirect the energy of the company, and our results reflect
its continuing success. Gross margins have improved and operating profit from
continuing operations is up 16%. Whilst trading across Continental Europe was
mixed, the core UK business performed well. Despite some uncertainties in
Continental Europe, our improvements in margin performance provide us with
confidence for a satisfactory performance for the full year.'
For more information, please contact:
Steve Vaughan / Stephen Gleadle / Christine Jones Tel: 020 7831 3113 (on 30.5.03)
Synstar plc Tel: 01344 662744 (thereafter)
Ed Bridges / James Melville-Ross / Juliet Clarke
Financial Dynamics Tel: 020 7831 3113
Chairman's Statement
I am pleased to report that Synstar has once again achieved the objectives we
set. As always, we have remained true to our over-riding principle of managing
the company for growth in profits and cash. This strategy has been particularly
important during a challenging period for the IT services market.
The steps taken by the management team since 2001 to re-invigorate the business
have borne fruit through changes to the structure of the business and its
products and through the introduction of client relationship managers. The focus
on selling multiple, higher margin service lines to larger customers is showing
very positive results and additions to the senior management team have brought
real added strength.
The results for the first half show a significant improvement in margin and
provide strong evidence of the success of this management team's strategy that
has been developed and implemented over the past two years. The result is that
our cash generation before financing of £2.2m has more than doubled against the
same period in 2002.
Reflecting Synstar's growth in profits and cash, the Board has taken the
decision to commence the payment of a dividend to shareholders. This will take
place following shareholder approval at the Annual General Meeting in March
2004. It will be set at a level which will not inhibit our ability to exploit
opportunities to develop the company further.
With the success of our three-phase strategy now bearing fruit, especially in
the UK, a major objective in the short term is for us to replicate this success
across our Continental European network. It is to these remaining businesses
that we have now turned the energies of the group. As reported by many other IT
companies, market conditions in parts of Continental Europe have continued to
deteriorate in the first half. However, we are confident that the success of
our strategy in our core UK market will stand us in good stead as we focus our
attention on building profitable, cash generative businesses across the
Continent in the longer term.
CVC Capital Partners has provided support to the company through the buy-out
from Granada, the flotation of the company and its subsequent development. The
Board would like to express its gratitude to CVC for their tremendous
contribution to the company and in particular to Jonathan Feuer who represented
them on the Board until his resignation earlier this year. Until recently CVC
owned more than 30% of the company. This stake was sold through three successful
placements since the preliminary results for 2002. As a result Synstar has a
number of major new shareholders to whom we offer a warm welcome.
The Nomination Committee is currently involved in recruiting an additional
independent non-executive director to add further strength to the Board.
The progress of the company has only been made possible by the efforts of our
people. This has been true throughout the time I have been involved with
Synstar and on behalf of the Board I would like to thank them all for the
dedicated and professional way they continue to support the company and, more
importantly, our customers.
Chief Executive's Review
Introduction
The transformation at Synstar has continued during the first half of the year
and the strategy put in place over the past two years has resulted in another
solid set of results. The bedrock of this strategy remains to drive
profitability through:
• Cross selling extra services to existing customers and wherever possible
closing larger, more joined up deals; and
• the rollout of our standard service lines across the whole of the company to
enable us to deliver full infrastructure managed services consistently across
the whole of Europe.
In a challenging market environment for IT services, the company's ability to
grow profits has been achieved by the simple practice of listening to what our
customers need and efficiently managing our costs.
Summary of Results
Operating profit from continuing operations was £3.7m (2002: £3.2m), an increase
of 16%. Our revenue from continuing operations was up slightly at £111.5m
(2002: £109.9m). Profit before tax increased from £1.6m in 2002 to £3.8m.
Adjusted earnings per share increased by 23% to 1.6p (2002: 1.3p).
The improvement in profitability has been due almost entirely to our continued
ability to increase gross margins. This is because we have adjusted the mix of
our services, selling more of those with higher margins. Whilst we expected to
keep the gross margin constant in the first half we have in fact increased this
to 26.1% (2002: 25.5%). This has enabled us to more than double our cash inflow
before financing, which grew to £2.2m from £1.0m in the first half of 2002
despite an increase in capital expenditure to £7.0 m (2002: £6.2 m).
Operational performance
A number of business principles have enabled us to achieve our aim of growing
profits and cash.
We have focused on our customers' needs and have achieved this by overhauling
the way in which we manage relationships with our customers. The benefit of
these changes is apparent with new business successes during the half-year, such
as Cognotec, Dutch Ministry of Defence and Corsair and the continued strength of
our order book.
The successful implementation of the strategy of winning multi-service business
from larger clients has again showed very positive results and our investment
and sales effort has paid real dividends. Our £15m contract with the Atomic
Weapons Establishment (AWE), announced on 3 March 2003, was won in a highly
competitive bidding environment and will see AWE using four out of Synstar's
five service lines. Our renewed and expanded relationship with CSC, our largest
customer, has borne fruit as they have in turn been successful in a number of
large contract wins recently.
We now sign a larger multi-service line deal about once a month. These have
been offset by a reduction in revenue streams from smaller customers. In part,
this is deliberate - the elimination of low margin, low potential small business
has been a crucial element of margin improvement and allows us to focus on
better prospects. However there is evidence that we can do a better job at
retaining good quality small customers, thereby deriving more margin from them.
A refinement of the customer relationship model to achieve this, using more
telephone-based customer contact and more automated handling of this type of
business, is underway to achieve this.
Higher margins are also driven by our new service line development and this has
remained an important focus for the group. We have recently developed
Chameleon, a new service for very high availability computing to smaller
customers. The target market is our existing Business Continuity customer base,
and we can now provide a high availability solution to these customers that has
hitherto only been available for large customers who invested significant
amounts of money in fully duplicated operations. Expansion in Internet Protocol
(IP) telephony, network security, large system maintenance and other new
services is also helping to maintain our margins.
The final element is careful cost control that has enabled us to maintain
operating expenses at a steady level this half.
As a result of the full implementation and roll-out of our strategy in the UK
and Republic of Ireland, operating profit from this region increased by 50% to
£5.4 m (2002: £3.6 m).
Continental Europe
Synstar's markets are not, however, without their challenges. The three-year
strategy that we set in motion at the start of 2001 was designed to reposition
and redirect the energy of the company, and the Group's results demonstrate its
success. Nevertheless, there is more to do and the most important issue
requiring our attention is the performance of our businesses in Continental
Europe. Our underlying goal in Europe is to mirror our success in the UK by
rolling out the same core strategy of selling multiple product lines to larger
customers.
We have seen some successes in Holland. The strong country management team has
delivered sales wins with a number of high profile customers. This is a good
business that we are confident will continue to grow.
Our operations in France and Germany (and to a lesser extent Spain and Belgium)
are feeling the effects of the severe economic conditions in these markets. We
continue to focus on managing costs against revenues whilst investing in new
business lines. For instance, our new business recovery centre in Frankfurt is
attracting considerable customer interest and we are developing a networking
capability in Belgium. However, market conditions remain extremely tough in
France and Germany in particular.
Our success in addressing these markets is dependent upon engaging the strength
of the whole group. We have numerous customers with multinational operations,
but not enough where we deliver in more than one country. Driving growth through
cross-border and multinational customers is a key focus for us now. Our
Relationship Manager structure facilitates this approach.
Growth in Europe is crucial in the longer-term, and growth without investment is
almost impossible. The primary challenge remains to transform these businesses
from a relatively low revenue base, particularly compared to the very strong
revenue position in the UK. We have already disposed of under performing,
non-core businesses (Italy and Switzerland). Our medium term strategy for
Europe may therefore necessitate us adding to the critical mass of our
operations on the continent through merger or acquisition. There are many
potential targets and some of them may represent a good match and good value.
However, an acquisition programme is not a top priority in the short term.
It is the Board's belief that the principles that have guided our success in our
UK business, and which are evident in the results announced today, can be
repeated in Europe given time.
Outlook
We remain committed to our programme of managing profitable growth by continuing
to target larger scale, higher margin business and broadening our product
offering in all geographic regions.
In the second half we expect that the UK business will continue to trade well,
with a focus on managing the revenue mix in order to drive operating profits
forward. Nevertheless, the economic conditions in mainland Europe remain
challenging and our efforts in the second half will be focused on managing the
cost base whilst seeking to position these businesses better to develop existing
customers and attract new ones.
The three year strategy that we set in motion at the start of 2001 was designed
to reposition and redirect the energy of the company, and our results reflect
its continuing success. Margins have improved and profits before tax are up
23%. Despite some uncertainties in Continental Europe, our improvements in
margin performance provide us with confidence for a satisfactory performance for
the full year.
Finance Director's Review
Introduction
The overall results for the six months to 31 March 2003 continue to demonstrate
improvement in the business. Year on year operating profit has increased 19% to
£3.7m (2002: £3.1m) and cash generation before financing has increased by £1.2m
to £2.2m.
To explain the year on year results better the 2002 numbers have been
re-analysed to reflect the impact of the disposal of our Swiss business. The
results from the continuing business have then been translated at the same rate
of exchange between sterling and the Euro as has been applied to the 2003
results. This then gives a better 'like for like' comparison of the results in
the context of a year-on-year 7% appreciation of the Euro compared with
sterling.
Thus operating profit before goodwill and exceptionals can be analysed as
follows:
£'m H1 2002 H1 2002 H1 2002 H1 2002 H1 2003
Published Discontinued Continuing Continuing Reported
Results Operations Business Business Results
2002 Exchange 2003 2003 Exchange
rates Exchange rates rates
Revenue 111.6 1.7 109.9 112.6 111.5
Cost of Sales (83.1) (1.1) (82.0) (84.0) (82.4)
Gross Margin % 28.5 0.6 27.9 28.6 29.1
25.5% 25.4% 25.4% 26.1%
Sales and Marketing (6.2) (0.1) (6.1) (6.2) (6.3)
Administration costs (19.2) (0.6) (18.6) (19.1) (19.1)
Operating profit 3.1 (0.1) 3.2 3.3 3.7
As can be seen from the above, the Discontinued Operations (Switzerland) and the
strengthening of the euro exchange rate had no material impact on operating
profit. However it is helpful to take them into account when analysing revenue
and cost changes.
The commentary below is now focused on explaining the changes in the continuing
business at constant exchange rates.
Revenue
Although reported year-on-year revenues show a small amount of growth it can be
seen that this is accounted for by changes in the exchange rate. Including this
effect, revenues from continuing operations have decreased £1.1m to £111.5m.
This is being driven by a reduction in project related revenues, which have then
been partially offset by increases in higher margin contractual revenues,
particularly in Business Continuity. Overall the percentage of total revenues
represented by long-term contracts is 76%.
Gross Margin
Gross margin for the continuing business has increased from 25.4% to 26.1%
reflecting both the benefit of rising Business Continuity revenues at high
margin (being offset by lower margin Data Management revenues) and the impact of
an increased concentration within the business on cost control and in particular
staff and sub-contract costs.
Operating Expenses
Overall operating expenses in the continuing business have increased less than
1% to £25.4m with inflationary pressures being offset by headcount efficiencies
and other cost controls.
Operating Profit
Arising from the above, operating profit before exceptionals on continuing
businesses has increased by £0.4m (12%) to £3.7m. Operating margin on the same
basis has increased from 2.9% to 3.3%. Operating profit analysed in terms of
our main business segments has been driven by a strong growth in the Business
Continuity segment. Computer Services profits have fallen slightly due to, in
particular, reductions in profit in Belgium and Germany being then largely
offset by a strong UK performance.
Loss on disposal of discontinued operations
The loss on disposal of discontinued operations shown in the 2002 profit and
loss relates to the disposal of the contracts in the Swiss business which took
place on 1 March 2002. Under the terms of the sale, Itris Maintenance AG
acquired the contracts held by Synstar Computer Services AG, the stocks of
maintenance equipment, and re-employed 41 of its staff. The consideration for
the sale was a cash payment of £0.3m. The exceptional item of £1.5m relates to
the loss on the sale of the business and associated costs.
Interest and Taxation
As the underlying cash position continues to strengthen the Group has now moved
into an interest generating position receiving net income of £0.1m in the first
half (2002: nil).
Following the significant reductions in the effective tax rate in 2001 and 2002
the tax rate is forecast to be held at 32% for 2003.
Earnings per Share
Earnings per share has thus benefited from the combined impact of increasing
operating profit and the generation of interest income. Before exceptional
items EPS has increased 23% from 1.3p last year to 1.6p this year.
Cash Flow and Net Funds
Cashflow before financing from the business remains strong with £2.2m being
generated in the first half (2002: £1.0m). The higher cash generation is driven
by the increasing profits and lower year on year working capital usage. This has
then been partially offset by higher levels of capital expenditure to drive
future growth and the move into a tax-paying situation.
The business remained ungeared at 31 March 2003 with net cash balances of £19.2m
(31 March 2002: £9.0m). As previously reported the timing of payments from
some large customers heavily influences the cash balance at 31 March and 30
September. The £0.1m net interest income indicates that on average across the
first 6 months the business ran a small cash surplus.
Return on capital employed
Pre-tax return on capital employed has risen 1% year on year to 22% (circa 15%
post tax). With a post tax weighted average cost of capital (WACC) around 8%
the Group is now comfortably value generating.
CONSOLIDATED PROFIT AND LOSS ACCOUNT
for the six months ended 31 March 2003
6 months to 6 months to 12 months to
31 March 31 March 30 September
Notes 2003 2002 2002
£'000 £'000 £'000
Turnover 2
Continuing operations 111,517 109,870 220,150
Discontinued operations - 1,720 1,720
Total turnover 111,517 111,590 221,870
Cost of sales (82,386) (83,125) (163,558)
Gross profit 29,131 28,465 58,312
Selling and marketing costs (6,306) (6,165) (12,188)
Administration expenses (19,143) (19,242) (38,116)
Operating profit
Continuing operations 3,682 3,198 8,148
Discontinued operations - (140) (140)
Total operating profit 2 3,682 3,058 8,008
Loss on disposal of discontinued operations 3 - (1,492) (1,493)
Profit on ordinary activities before interest 3,682 1,566 6,515
Interest receivable and similar income 191 95 235
Interest payable and similar charges (76) (91) (218)
Profit before tax 3,797 1,570 6,532
Tax on profit on ordinary activities 4 (1,216) (1,010) (2,563)
Profit for the financial period 2,581 560 3,969
Earnings per share 5
Adjusted basic 1.6p 1.3p 3.4p
Basic 1.6p 0.3p 2.4p
Diluted 1.6p 0.3p 2.4p
Adjusted basic earnings per share has been calculated before exceptional charges
and net of taxation.
Consolidated Statement of Total Recognised Gains and Losses
for the six months ended 31 March 2003
6 months to 6 months to 12 months to
31 March 31 March 30 September
2003 2002 2002
£'000 £'000 £'000
Profit for the financial period 2,581 560 3,969
Currency translation differences on foreign
currency net investments 1,144 348 (81)
Total recognised gains and losses relating
to the period 3,725 908 3,888
CONSOLIDATED BALANCE SHEET
as at 31 March 2003
31 March 31 March 30 September
2003 2002 2002
£'000 £'000 £'000
Fixed assets
Tangible assets 34,122 35,266 33,646
Current assets
Stocks 1,833 2,743 1,950
Debtors - amounts falling due within one year 50,597 51,709 51,432
Debtors - amounts falling due after one year 1,995 405 1,973
Cash at bank and in hand 19,213 13,439 17,431
73,638 68,296 72,786
Creditors: Amounts falling due within one year (65,348) (67,855) (67,745)
Net current assets 8,290 441 5,041
Total assets less current liabilities 42,412 35,707 38,687
Net assets 42,412 35,707 38,687
Capital and reserves
Called-up share capital 1,625 1,625 1,625
Share premium account - 94,578 -
Profit and loss account 40,787 (60,496) 37,062
Total shareholders' funds - all equity 42,412 35,707 38,687
Reconciliation of Movement in Group Shareholders' Funds
for the six months ended 31 March 2003
6 months to 6 months to 12 months to
31 March 31 March 30 September
2003 2002 2002
£'000 £'000 £'000
Profit for the period 2,581 560 3,969
Currency translation differences 1,144 348 (81)
Net addition to shareholders' funds 3,725 908 3,888
Opening shareholders' funds 38,687 34,799 34,799
Closing shareholders' funds 42,412 35,707 38,687
CONSOLIDATED CASH FLOW STATEMENT
for the six months ended 31 March 2003
6 months to 6 months to 12 months to
31 March 31 March 30 September
Notes 2003 2002 2002
£'000 £'000 £'000
Net cash inflow from operating activities 6 9,330 6,532 21,441
Returns on investments and servicing of finance 7 115 4 17
Taxation 7 (273) 652 (977)
Capital expenditure 7 (6,972) (6,180) (11,511)
Disposals 7 - (8) (546)
Net cash inflow before financing 2,200 1,000 8,424
Financing 7 (814) 2,055 (954)
Increase in cash in the period 8 1,386 3,055 7,470
NOTES TO THE INTERIM FINANCIAL INFORMATION
1. Preparation of the interim financial information
The interim financial information has been prepared on the basis of the
accounting policies set out in the group's 2002 statutory accounts.
The balance sheet at 30 September 2002 and the results for the year ended 30
September 2002 have been abridged from the group's 2002 statutory accounts which
have been filed with the Registrar of Companies; the auditors' opinion on those
accounts was unqualified and did not include a statement under s237 (2) or (3)
of the Companies Act 1985.
The interim information does not constitute statutory accounts within the
meaning of section 240 of the Companies Act 1985.
2. Segmental analysis
6 months to 6 months to 12 months to
31 March 31 March 30 September
2003 2002 2002
£'000 £'000 £'000
a. Turnover by destination
UK and Republic of Ireland 69,496 68,006 142,659
France 9,886 8,586 16,967
Germany 12,440 13,814 26,744
Switzerland 35 1,720 1,720
Other European countries 19,660 19,464 33,780
111,517 111,590 221,870
b. Class of business
Turnover:
Computer Services
- Continuing operations 101,251 100,379 200,564
- Discontinued operations - 1,720 1,720
Business Continuity 10,266 9,491 19,586
111,517 111,590 221,870
Operating profit:
Computer Services
- Continuing operations 3,548 3,614 8,627
- Discontinued operations - (140) (140)
Business Continuity 1,579 1,120 2,441
Central expenditure (1,445) (1,536) (2,920)
3,682 3,058 8,008
Net assets:
Computer Services 27,172 28,957 24,973
Business Continuity 2,721 3,085 2,919
Unallocated net assets 12,519 3,665 10,795
42,412 35,707 38,687
c. Geographical segment
Turnover:
UK and Republic of Ireland 72,810 69,858 142,467
Rest of Europe
- Continuing operations 38,707 40,012 77,683
- Discontinued operations - 1,720 1,720
111,517 111,590 221,870
Operating profit:
UK and Republic of Ireland 5,443 3,580 9,490
Rest of Europe
- Continuing operations (316) 1,154 1,578
- Discontinued operations - (140) (140)
Central expenditure (1,445) (1,536) (2,920)
3,682 3,058 8,008
Net assets:
UK and Republic of Ireland 23,072 21,983 20,698
Rest of Europe 6,821 10,059 7,194
Unallocated net assets 12,519 3,665 10,795
42,412 35,707 38,687
In relation to the discontinued operations in Switzerland, the profit and loss
comparatives for the 6 months to 31 March 2002 and year ended 30 September 2002
include cost of sales of £1,160,000, gross profit of £560,000, sales and
marketing costs of £149,000 and administration expenses of £551,000.
Unallocated net assets consist of group cash, taxation payable, and other
centrally held or managed assets and liabilities.
3. Exceptional Items
On 1st March 2002, the group disposed of its Swiss operations to Itris
Maintenance AG. Under the terms of the sale, Itris acquired the contracts held
by Synstar Computer Services AG, the stocks of maintenance equipment, and
re-employed 41 of its staff. The consideration for the sale was a cash payment
of £0.3m. The exceptional item of £1.5m relates to the loss on the sale of the
business and associated costs. The results of the Swiss subsidiary have been
disclosed as discontinued operations. The tax effect is £Nil.
4. Tax on profit on ordinary activities
6 months to 6 months to 12 months to
31 March 31 March 30 September
2003 2002 2002
£'000 £'000 £'000
UK Corporation tax
- Continuing operations 866 462 1,853
Overseas tax
- Continuing operations 350 548 1,236
Adjustment in respect of prior year - - (24)
- Overseas taxation (continuing operations)
Group tax charge 1,216 1,010 3,065
Deferred tax - - (502)
1,216 1,010 2,563
The group tax charge represents the estimated annual effective tax rate applied
separately to the adjusted profit on continuing and discontinued ordinary
activities, and the estimated annual effective rate applied to the exceptional
items. The interim period is regarded as an integral part of the annual period
and all tax liabilities are disclosed as such.
5. Earnings per share
Basic earnings per share are calculated in accordance with Financial Reporting
Standard 14 Earnings per Share, based on profit after charging tax of £2,581,000
(6 months to 31 March 2002 - £560,000; year ended 30 September 2002 -
£3,969,000) and 162,500,000 (6 months to 31 March 2002 - 162,500,000; year ended
30 September 2002 - 162,500,000) ordinary shares, being the weighted average
number of shares in issue during the period.
Diluted earnings per share is the basic earnings per share after allowing for
the dilutive effect of options, in issue. The number of shares used for the
diluted calculation is 162,889,139 (6 months to 31 March 2002 - 163,032,906;
year ended 30 September 2002 - 162,977,000)
The adjusted basic earnings per share information has been calculated before
exceptional costs and net of taxation, and goodwill. The Directors believe this
additional measure provides a better indication of the underlying trends in the
business.
The calculations of earnings per share are based on the following profits and
numbers of shares:
6 months to 6 months to 12 months to
31 March 31 March 30 September
2003 2002 2002
£'000 £'000 £'000
Profit for the period for basic earnings per share 2,581 560 3,969
Exceptional items - 1,492 1,493
Profit for the period for adjusted basic
earnings per share 2,581 2,052 5,462
Weighted average number of shares in issue:
6 months to 6 months to 12 months to
31 March 31 March 30 September
2003 2002 2002
'000 '000 '000
For basic earnings per share 162,500 162,500 162,500
Exercise of options and warrants 389 533 477
For diluted earnings per share 162,889 163,033 162,977
6. Reconciliation of operating profit to net cash inflow
6 months to 6 months to 12 months to
31 March 31 March 30 September
2003 2002 2002
£'000 £'000 £'000
Operating profit 3,682 3,058 8,008
Depreciation charge 6,933 7,225 14,302
Decrease in stocks 252 112 919
Decrease (increase) in debtors 2,636 (3,457) (4,343)
(Decrease) increase in creditors (4,173) (406) 2,555
Net cash inflow from operations 9,330 6,532 21,441
7. Analysis of cash flows
6 months to 6 months to 12 months to
31 March 31 March 30 September
2003 2002 2002
£'000 £'000 £'000
Returns on investments and servicing of finance:
Interest paid (76) (91) (218)
Interest received 191 95 235
115 4 17
Taxation:
Net tax (paid) refunded (273) 652 (977)
Capital expenditure:
Purchase of fixed assets (6,972) (6,229) (11,703)
Proceeds on sale of fixed assets - 49 192
(6,972) (6,180) (11,511)
Disposals:
Disposal consideration - 324 324
Disposal costs paid - (332) (870)
- (8) (546)
Financing:
(Repayment) Receipts of loans (814) 2,055 (954)
8. Reconciliation of net cashflow to movement in net funds
6 months to 6 months to 12 months to
31 March 31 March 30 September
2003 2002 2002
£'000 £'000 £'000
Net increase in cash during period 1,386 3,055 7,470
Cash outflow (inflow) from decrease (increase) in debt 814 (2,055) 954
Change in net funds resulting from cashflows 2,200 1,000 8,424
Foreign exchange 574 16 (3)
Movement in net funds in period 2,774 1,016 8,421
Net funds at beginning of period 16,439 8,018 8,018
Net funds at end of period 19,213 9,034 16,439
9. Analysis of net funds
Cash at bank Overdraft Loans Total
£'000 £'000 £'000 £'000
At 30 September 2002 17,431 (178) (814) 16,439
Cashflows during period 1,208 178 814 2,200
Foreign exchange 574 - - 574
At 31 March 2003 19,213 - - 19,213
10. Approval of Interim financial information
This interim financial information was approved by the Board of Directors on
29th May 2003
11. Shareholder information
The interim information is being sent to all shareholders and copies are
available to the public from the registered office of the company; Synstar
House, 1 Bracknell Beeches, Old Bracknell Lane West, Bracknell, Berkshire, RG12
7QX. The company's registered number is 3416147.
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