Final Results
Trifast PLC
19 June 2007
19 June 2007
TRIFAST PLC
Preliminary Results for the year ended 31 March 2007
Commenting on the year's results, Steve Auld, Chief Executive, said:
"2006/07 has been marked by many excellent results for Trifast plc.
The Group's financial targets have been achieved enabling the Management Team to
report new levels of shareholder value, to consider investment in new business
strategies and, very importantly to look at new business opportunities in new
countries."
Financial and Operational Highlights:
• Revenues increased by 12% to £131.9m (2006: £117.3m)
• Pre-tax profit* grew by 55% to £8.8m (2006: £5.7m)
• Diluted earnings per share increased by 154% to 4.70p (2006: 1.85p)
• Final dividend increased by 12% to 1.66p (2006: 1.48p)
• Successful integration of Serco-Ryan, planned £2.0m cost savings
exceeded
• Purchased 25% stake in leading Malaysian manufacturer Techfast for £2.7m
• Positive start to new financial year
• Development of the "key skills" of staff to underpin a strategy of sales
growth
* Pre intangible amortisation, goodwill impairment, IFRS2 charges and
restructuring costs
Enquiries:
Trifast Group plc Tel: 020 7360 4900 on 19 June only,
thereafter Tel: 01825 747 366
Steve Auld, Chief Executive Officer
Stuart Lawson, Chief Financial Officer
Smithfield Consultants Tel: 020 7360 4900
John Antcliffe / Will Swan
Arden Partners Tel: 020 7398 1632
Richard Day / Steve Pearce
Notes to Editors
Trifast plc is a leading international manufacturer and distributor of
industrial fastenings to the assembly industries, with operations in Europe, the
Americas and Asia.
For more information please visit www.trifast.com
Trifast plc
Preliminary Results for the year ended 31 March 2007
31 March 31 March Percentage
2007 2006 Change
Revenue £131.95m £117.28m Up 12%
Gross profit £34.72m £29.13m Up 19%
Operating profit £9.74m £6.38m Up 53%
(before intangible amortisation, goodwill
impairment, IFRS 2 charges and restructuring
costs)
Operating profit £6.36m £3.24m Up 96%
Pre-tax profit £8.81m £5.69m Up 55%
(before intangible amortisation, goodwill
impairment, IFRS 2 charges and restructuring
costs)
Pre-tax profit £5.43m £2.55m Up 113%
Earnings per share
- Adjusted diluted 7.29p 4.76p Up 53%
- Basic 4.70p 1.86p Up 153%
- Diluted 4.70p 1.85p Up 154%
Dividend
- Final 1.66p 1.48p Up 12%
- Full Year 2.43p 2.21p Up 10%
Directors Business Review by Steve Auld CEO and Stuart Lawson CFO
Summary of Trading
The Group reported strong financial results for the year, creating a strong
platform for the management team to invest in new business strategies and
importantly to look at new business opportunities in new countries.
Revenues for the Group increased by 12% to £131.95million, with the contribution
of acquisitions and strong growth in Asia offset in part by a decline in sales
in the UK. Export sales grew by 36%. The 55% increase in pre-tax profit (before
intangible amortisation, goodwill impairment, IFRS2 charges and restructuring
costs) to £8.81million reflects both the growth in revenues and operating margin
improvements driven by an improved business mix, purchasing initiatives and the
successful integration of Serco-Ryan resulting in cost savings in excess of
£2.00million per annum.
Today, the structure of our business allows us to provide flexible solutions
through an enhanced level of service to our customers both in the UK and around
the world. We have strong management and operating teams, a good spread of
customers and sectors supported by a widespread geographical operational network
with highly motivated and experienced staff.
As expected the raw material price pressures have continued resulting in the
market place still being price competitive. However, we are pleased to report
that the new financial year started positively. The Group is operating from a
position of strength led by the highly experienced Management Team.
The 2006/07 business year has been very successful and has seen the Group
achieve market expectation for its operational profit numbers.
The business integration of Serco-Ryan has been a great success. This has
allowed us to accelerate our plans for the further development of the Group.
During the year we have undertaken detailed market research within Europe on the
markets in which we plan to operate and, as a Group, we are now starting to make
key investments in organisational structure.
We have also expanded in Asia to meet the anticipated growth in demand for our
products where we have seen turnover increase by 21% in this region.
In consolidating our UK businesses following the acquisition of Serco-Ryan we
have seen our UK operating profits grow by 55% despite a decline in sales
resulting from the continued downsizing of the UK automotive sector.
The disappointing region for us this year has been the USA which is covered in
more detail below.
The year's highlights:
• Sales up 12%;
• Pre-tax profit up 55% (before intangible amortisation, goodwill
impairment, IFRS2 charges and restructuring costs);
• Full year dividend increase 10%;
• Export sales up 36%.
After five years as Chief Executive of Trifast, Jim Barker stood down at the end
of May. Since April 2002 Jim has overseen the Group's acquisition of Serco Ryan
and the transformation of the Group into a major player in the industrial
fastener market. We would like to extend our thanks to Jim for his unfailing
commitment to Trifast over this period.
Opportunities
Within Europe the Group is currently reviewing its sales activities in Poland
and is in the process of setting up a sales office to support both our current
and future business in this region. In Asia our Management Team is investigating
the business case for setting up a distribution and manufacturing facility in
India. These opportunities, if implemented, will become operational towards the
end of the current financial year.
Europe
Europe has seen the greatest improvement in fortunes when compared to the prior
year with profit growth (before intangible amortisation, goodwill impairment,
IFRS2 charges and restructuring costs) of 59%. The European subsidiaries, with
the exception of France, have generated good revenues and operating profit for
the financial year 2006/07. We believe that the management and development of
sales and operating profits in these areas will continue to be strong.
As we believe TR France has no prospect of achieving a profit in the medium term
we will discontinue operations over the next 6 months, electing to supply
customers either from the UK or Holland.
Elsewhere sales to distributors through Lancaster Fasteners have been very
successful with an operating profit growth of 23%.
The Americas
Trifast's acquisition of a West Coast distributor business in the late 1990's
supported the strategy of pursuing global OEM customers. Much of the larger
business has since evaporated as these major OEM's opted for the use of contract
manufacturers predominantly sited in Asia.
Trifast subsequently achieved outstanding success by following this business to
Asia, necessitating a review of our US strategy as described below.
The USA will concentrate on its existing small OEM customer base and the
foundation of a distributor network of proprietary products. The Board is
confident that a more narrowly focused OEM sales activity, in conjunction with a
distributor based products sales initiative, provides the best prospect for
future success in the USA.
Asia
Sales growth in Asia is 21% in the financial year 2006/07 which produced a
significant operating profit growth of 43%.
Our challenge in Asia is to ensure our current manufacturing equipment and
processes keeps pace with the demand from our valued customer base. We have
further manufacturing capacity within our Asian facilities as all factories are
not running a three shift programme, with the exception of Singapore.
Our Asian businesses are constantly looking to maintain full compliance with
industry quality standards and indeed the environmental accreditation IS14001
(our Singapore factory is approved).
Review of our financial performance in 2006/07
31st March 31st March Percentage change
2007 2006
£million £million
Revenue £131.9 £117.3 Up 12%
Principal reasons for revenue growth in 2006/07
• a full year's results for the acquisition made in 2006 of Serco-Ryan
• increased transactional sales in the UK;
• 52% growth in Singapore sales due to increased usage in disk drive
products;
• The above partly off-set by a decreased turnover in some large contract
accounts in the UK, predominantly in the automotive sector due to
consolidation, and a continued down sizing of the UK manufacturing base.
31st March 31st March Percentage
2007 2006 change
Gross profit margin* 26.32% 24.84% Up 6%
Operating margin* 7.38% 5.44% Up 36%
* before intangible amortisation, goodwill impairment, IFRS2 charges and
restructuring
costs.
Principal Reasons for margin improvement in 2006/07
• improved quality and mix of business;
• improved purchasing initiatives including increased spend in Asia and
more importantly in our own factories;
• reduction of business in lower margin automotive sector;
• increased operational efficiency;
• improved overhead efficiency (see below).
31st 31st Percentage
March March Change
2007 2006
£million £million
Profit before tax, £8.81 £5.69 Up 55%
intangible amortisation, goodwill impairment,
IFRS2 charges and restructuring costs
Principal Reasons for improvement in profit before tax in 2006/07
• increased turnover (as noted above);
• gross margin improvement (as noted above);
• restructuring programme with the planned £2.00million annualised cost
savings exceeded;
• full year's results for acquisitions made in 2006, Serco-Ryan and TR
Keba Turkey.
31st March 2007 31st March 2006 Percentage change
Overhead costs as a 19.10% 19.50% Reduced by 2%
% of turnover*
* before intangible amortisation, goodwill impairment, IFRS2 charges and
restructuring
costs.
Principal Reasons for increased overhead efficiency in 2007
• consolidation of business platforms;
• improved use of IT technology;
• streamlined management structure throughout Europe;
• improved awareness of costs and cost controls.
As a team we are satisfied that the Group has made good progress in all of the
above areas as shown by the numbers. Having reduced our operating platform and
improved our efficiencies over the last two years, our focus for the next 12
months is now firmly on topline sales growth with the Management Team now
involved in all areas of our business to promote this.
Restructuring costs
During the period, we completed the integration of the UK businesses of TR
Fastenings Limited and Serco-Ryan and commenced the closure of Trifast's French
operation, thereby completing the restructuring of our European business
platform. The costs associated with this restructuring amounted to £2.89million
predominantly arising from employee contract termination costs, property
dilapidation and fixed asset disposal and the legal costs associated with site
closures. In total eight sites were closed or significantly restructured in
Europe and the business merged into other larger and more efficient Trifast
locations.
Have These Improvements Increased Shareholder Wealth?
Earnings per share
We are presenting an adjusted diluted earnings per share measure that adds back
the effect of restructuring costs, intangible amortisation and impairment of
goodwill and the related tax effects.
31st March 2007 31st March 2006 Percentage
per share per share change
Adjusted diluted earnings per share 7.29 pence 4.76 pence Up 53%
Basic earnings per share 4.70 pence 1.86 pence Up 153%
The diluted weighted average number of shares outstanding during the period was
84,584,980 (2006: 77,639,682).
Dividend payment
The Board continues to maintain its progressive dividend policy (an increase of
5% per year for the last 5 years), but given the excellent results this year, it
is proposed to increase dividends by a further 5% giving a full year dividend
growth of 10% on the prior year, and being a good reflection on the Board's view
of the success of this year's numbers and confidence in the future prospects of
the Group.
31st March 2007 31st March 2006 Percentage
per share per share Change
Final Dividend Payment* 1.66 pence 1.48 pence Up 12%
Full Year Payment 2.43 pence 2.21 pence Up 10%
The final dividend, which is subject to shareholder approval at the Annual
General Meeting on 27th September 2007, will be paid on 17th October 2007 to
shareholders on the Register as at 29th June 2007.
* In compliance with IAS 10 the final dividend will be shown as an appropriation
of
reserves in the year ending 31st March 2008.
Have we managed our assets successfully?
We have grown Return on Capital Employed by 31% by growing profitability and
successfully managing our working capital.
Free cashflow, (being cashflow before acquisitions, financing costs and
restructuring costs) for the Group for 2007 was an inflow of £9.89million (2006:
£6.28million inflow). Controls on working capital remain tight with debtors days
at 67 days (2006: 65 days) and creditors at 78 days (2006: 69 days).
The stock level remained relatively constant at £25.61million (2006:
£25.12million) which reflects an underlying decrease in customer specific stock,
held an increase in own branded product ranges held for the growth of the Master
Distribution Programme and foreign exchange loss on re-valuation. We continue to
focus on this area and drive initiatives to increase the return we generate from
our stock asset.
Capital expenditure was relatively low during the period at £0.68million (2006:
£1.15million). This reflected the continued focus during the period on
restructuring and reduced investment in our manufacturing plant in China as it
reaches profitability at Phase 1 before moving into Phase 2. We expect to see an
increase in capital expenditure for 2008 as we invest in upgraded IT Systems and
Phase 2 in China, pushing capital expenditure for 2008 to around £1.25million.
Depreciation levels were £1.17million (2006: £1.26million). We expect this to
remain relatively constant for 2008.
Although our gross debt figure remains relatively unchanged at £19.19million
(2006: £18.96million) we have during the period paid out the final £2.00million
instalment for the Serco-Ryan acquisition in cash instead of shares, a move
which had a positive impact on earnings per share, and we also acquired the 25%
stake in Techfast Holdings Bhd in Malaysia for £2.74million cash, again a
decision that enhanced earnings per share.
As last year, cash generation from operating activities was strong with
£10.88million (2006: £8.64million) being generated before the cash impact of
£1.63million restructuring costs, an increase of 26%.
At the year end the Group held net cash of £6.47million (2006: £6.25million),
thus giving us net borrowings of £12.72million (2006: £12.71million). This has
resulted in a reduced gearing level of 26.0% (2006: 26.5%), which leaves the
Group with the capacity to continue its growth strategy and to take advantage of
the consolidating market place.
Our Summary of 2006/07
2006/07 has been marked by many excellent results for Trifast plc.
The Group's financial targets have been achieved enabling the Management Team to
report new levels of shareholder value, to consider investment in new business
strategies and, very importantly to look at new business opportunities in new
countries.
The development of "key skills" in our Group has undergone a complete review
with more staff now attending or starting training initiatives supported by the
Group and its Management Teams.
Operating a clear business strategy that is targeting sales growth, the Group
will continue to utilise its financial strengths, motivated and experienced
staff, modern "world class" Asian factories and global distribution network.
Prospects
The excellent performance in 2007 has created a strong platform for the Group
and the Board is pleased to report that the new financial year has started
positively. The Board is confident about the future prospects for the Group.
Steve Auld Stuart Lawson
Chief Executive Officer Chief Financial Officer
Trifast plc
Preliminary Results
Consolidated income statement
for year ended 31 March 2007
Note 2007 2006
£000 £000
Revenue 1 131,946 117,282
Cost of sales (97,224) (88,150)
Gross profit 34,722 29,132
Other operating income 220 238
Distribution expenses (2,868) (3,774)
-------------------------- ------ --------- ----------
Administrative expenses before the following (22,336) (19,218)
items:
Goodwill impairment - (786)
IFRS2 Charge (213) (121)
Intangible amortisation (274) (121)
Restructuring costs 2 (2,894) (2,108)
-------------------------- ------ --------- ----------
Total administration costs (25,717) (22,354)
Operating profit 2 6,357 3,242
Financial income 144 54
Financial expenses (1,175) (743)
Net financing costs (1,031) (689)
Share of profit of associate 100 -
Profit before tax 5,426 2,553
Taxation 3 (1,453) (1,115)
Profit for the year 3,973 1,438
(attributable to equity shareholders of the
Parent Company)
Earnings per share
Basic 8 4.70p 1.86p
Diluted 8 4.70p 1.85p
Dividends
Final proposed 2007 - 1.66p (2006: 1.48p) 1,406 1,249
Interim paid 2007 - 0.77p (2006: 0.73p) 650 616
All amounts in the income statement are derived from continuing operations for
the current and prior year.
Trifast plc
Preliminary Results
Statements of recognised income and expense
for year ended 31 March 2007
Group Company
Note 2007 2006 2007 2006
£000 £000 £000 £000
Foreign exchange translation (1,511) 1,470 - -
differences
Net gain on hedge of net investment in
foreign 14 4 - -
subsidiary
Net (expense)/income recognised
directly in 7 (1,497) 1,474 - -
equity
Profit for the year 7 3,973 1,438 2,449 893
Total recognised income for the year 7 2,476 2,912 2,449 893
Trifast plc
Preliminary Results
Balance sheets
at 31 March 2007
Note Group Company
2007 2006 2007 2006
£000 £000 £000 £000
Non-current assets
Property, plant and equipment 8,324 9,208 2,776 2,887
Intangible assets 23,316 24,591 16 29
Investments in associates 2,836 - 2,736 -
Equity investments - - 28,920 27,828
Deferred tax assets 350 573 - -
Total non-current assets 34,826 34,372 34,448 30,744
Current assets
Stocks 4 25,611 25,123 - -
Trade and other receivables 28,109 30,070 4,088 3,807
Cash and cash equivalents 5 6,757 6,524 5,256 5,208
Total current assets 60,477 61,717 9,344 9,015
Total assets 1 95,303 96,089 43,792 39,759
Current liabilities
Bank overdraft 5 287 272 3,187 1,513
Other interest-bearing loans and 6 2,795 3,008 1,696 1,764
borrowings
Trade and other payables 24,181 24,404 2,749 1,033
Tax payable 192 365 - -
Contingent consideration - 562 - 562
Deferred consideration - 2,000 - 2,000
Provisions 1,624 242 475 -
Total current liabilities 29,079 30,853 8,107 6,872
Non-current liabilities
Other interest-bearing loans and 6 16,394 15,950 13,047 10,989
borrowings
Provisions 1,096 1,215 - -
Deferred tax liabilities 509 826 189 314
Total non-current liabilities 17,999 17,991 13,236 11,303
Total liabilities 1 47,078 48,844 21,343 18,175
Net assets 1 48,225 47,245 22,449 21,584
Equity attributable to equity
holders of
the parent
Share capital 7 4,236 4,219 4,236 4,219
Share premium 7 12,046 11,873 12,046 11,873
Reserves 7 (626) 871 2,786 2,786
Retained earnings 7 32,569 30,282 3,381 2,706
Total equity 7 48,225 47,245 22,449 21,584
These financial statements were approved by the board of Directors on 18th June
2007.
Trifast plc
Preliminary Results
Cash flow statements
for year ended 31 March 2007
Note Group Company
2007 2006 2007 2006
£000 £000 £000 £000
Cash flows from operating
activities
Profit for the year 3,973 1,438 2,449 893
Adjustments for:
Depreciation, amortisation and
impairment 1,445 2,124 138 125
Financial income (144) (54) (312) (186)
Financial expense 1,175 743 791 383
Gain on sale of property, plant
and (7) (24) - -
equipment and investments
Dividends received - - (5,550) (5,000)
Write-off investment - - - 1,852
Equity settled share-based
payment 213 121 125 84
expenses
Profit from Associate (100) - - -
Taxation 1,453 1,115 (123) 18
Operating profit before changes
in working capital 8,008 5,463 (2,482) (1,831)
and provisions
Change in trade and other
receivables 973 (691) (280) (37)
Change in stock (1,066) 1,073 - -
Change in trade and other
payables 72 (50) 35 24
Change in provisions 1,262 1,243 475 -
Cash generated from the
operations 9,249 7,038 (2,252) (1,844)
Tax paid (1,668) (1,738) - -
Net cash from operating
activities 7,581 5,300 (2,252) (1,844)
Cash flows from investing
activities
Proceeds from sale of property,
plant and 64 17 - -
equipment
Interest received 145 52 311 186
Proceeds from sales of
investments - 144 - -
Acquisition of subsidiary and
associates, (4,761) (16,719) (4,850) (14,892)
net of cash acquired
Acquisition of property, plant
and equipment (683) (1,150) (14) (126)
Dividends received - - 5,550 5,000
Net cash from investing
activities (5,235) (17,656) 997 (9,832)
Cash flows from financing
activities
Proceeds from the issue of share
capital 7 190 8,274 190 8,274
Expenses for issue of share
capital 7 - (375) - (375)
Proceeds from new loan 3,799 11,200 3,799 11,200
Repayment of borrowings (2,810) (2,103) (1,741) (947)
Dividends paid 7 (1,899) (1,630) (1,899) (1,630)
Interest paid (1,090) (618) (720) (241)
Net cash from financing activities (1,810) 14,748 (371) 16,281
Net change in cash and cash
equivalents 536 2,392 (1,626) 4,605
Cash and cash equivalents at 1
April 6,252 3,622 3,695 (910)
Effect of exchange rate
fluctuations on (318) 238 - -
cash held
Cash and cash equivalents at 31
March 5 6,470 6,252 2,069 3,695
Trifast plc
Preliminary Results
NOTES
1. Segmental analysis
Segment information, as discussed above, is presented in the consolidated
financial statements in respect of the Group's geographical segments. This
reflects the Group's management and internal reporting structure.
Inter-segment pricing is determined on an arm's length basis.
Segment results, assets and liabilities include items directly attributable to a
segment as well as those that can be allocated on a reasonable basis.
Segment capital expenditure is the total cost incurred during the period to
acquire segment assets that are expected to be used for more than one period.
Geographical segments
The Group is comprised of the following main geographical segments:
Europe/America: includes UK, Norway, Sweden, France, Hungary, Southern Ireland,
Holland, Turkey, Poland, Los Angeles and Mexico
Asia: includes Malaysia, China, Singapore and Taiwan
In presenting information on the basis of geographical segments, segment revenue
and segment assets are based on the geographical location of our entities across
the world.
Europe/USA Asia Central Group
2007 2006 2007 2006 2007 2006 2007 2006
£000 £000 £000 £000 £000 £000 £000 £000
Revenue*
Revenue from
external 106,307 96,132 25,639 21,150 - - 131,946 117,282
customers
Inter segment
revenue 4,664 5,082 3,543 4,033 - - 8,207 9,115
Total revenue 110,971 101,214 29,182 25,183 - - 140,153 126,397
Segment
result 6,057 3,856 5,752 4,022 (2,184) (1,621) 9,625 6,257
before
items listed
below
Goodwill
impairment - (786) - - - - - (786)
Intangible
amortisation (274) (121) - - - - (274) (121)
Restructuring
costs (2,324) (2,108) - - (570) - (2,894) (2,108)
Operating
profit/(loss) 3,459 841 5,752 4,022 (2,754) (1,621) 6,457 3,242
before
financing
costs
Net financing
costs - - - - - - (1,031) (689)
Profit on
ordinary 5,426 2,553
activities
before
taxation
Taxation (1,453) (1,115)
Profit for
the 3,973 1,438
year
Assets and
liabilities
Segment 59,667 70,003 24,744 24,056 10,892 2,030 95,303 96,089
assets
Segment
liabilities (18,892) (27,178) (8,521) (9,997) (19,665) (11,669) (47,078) (48,844)
Segment net
assets/ 40,775 42,825 16,223 14,059 (8,773) (9,639) 48,225 47,245
(liabilities)
1 Segmental analysis (continued)
*Of the Asian external revenue, £4.9 million was sold into the American market
and £1.5 million sold into the European market.
There was no material difference in the European and American regions between
the external revenue based on location of the entities and the location of the
customers.
Revenue is derived solely from the manufacture and logistical supply of
industrial fasteners and category 'C' components and therefore considered to be
only one business segment.
The share of the Associate Techfast (based in Malaysia) has been included in the
Asia segment and not shown separately.
Europe Asia America Central Group
2007 2006 2007 2006 2007 2006 2007 2006 2007 2006
£000 £000 £000 £000 £000 £000 £000 £000 £000 £000
Cashflows
Operating activities
Segment
cashflow 7,831 5,165 1,234 1,813 200 181 (1,684) (1,859) 7,581 5,300
Investing activities
Segment
cashflow 686 (2,050) (791) (580) (9) (27) (5,121) (14,999) (5,235) (17,656)
Financing activities
Segment
cashflow (997) (1,513) (257) (8) (186) (12) (370) 16,281 (1,810) 14,748
Capital expenditure
Segment
cashflow 345 239 315 758 9 27 14 126 683 1,150
2 Expenses and auditors' remuneration
Included in profit for the year are the following:
2007 2006
£000 £000
Depreciation 1,171 1,217
Amortisation 274 121
Impairment loss on goodwill - 786
Forex (gains)/losses (47) 71
Restructuring costs - included in administrative expenses 2,894 2,108
Restructuring costs comprise £1.4 million redundancy payments, £0.4 million for
compensation of loss of office and £1.1 million other restructuring costs,
largely the result of the closure of our French site.
Auditors' remuneration:
2007 2006
£000 £000
Audit of these financial statements 42 43
Audit of financial statements of subsidiaries pursuant to
legislation 183 207
Other services relating to taxation 65 61
Services relating to corporate finance transactions entered into
by - 267
the
company
All other services 28 26
Auditors' remuneration for services relating to corporate finance transactions
of £nil (2006: £267,000) have been included in the consideration paid on
acquisition of subsidiaries.
3 Taxation
Recognised in the income statement 2007 2006
£000 £000
Current UK tax expense
Current year 300 26
Double taxation relief (103) (26)
Adjustments for prior years 3 (39)
200 (39)
Current tax on foreign income for the period 1,431 1,199
Adjustments for prior years (92) (35)
1,339 1,164
Total current tax 1,539 1,125
Deferred tax expense
Origination and reversal of temporary differences (26) 9
Adjustments for prior years (60) (19)
(86) (10)
Total tax in income statement 1,453 1,115
Reconciliation of effective tax rate and tax expense
2007 ETR 2006 ETR
£000 % £000 %
Profit before tax 5,426 2,553
Tax using the UK corporation tax rate of 30% 1,628 30 766 30
(2006: 30%)
Goodwill impairment - - 236 9
Non-deductible expenses 340 6 465 18
IFRS2 Share Option Charge (73) (1) 51 2
Associate Tax (30) - - -
Deferred tax assets not recognised 548 10 193 8
Different tax rates on overseas earnings (811) (15) (503) (20)
Over provided in prior years (149) (3) (93) (4)
Total tax in income statement 1,453 27 1,115 43
4 Stocks
Group
2007 2006
£000 £000
Raw materials and consumables 1,297 860
Work in progress 637 663
Finished goods and goods for resale 23,677 23,600
25,611 25,123
5 Cash and cash equivalents/bank overdrafts
Group Company
2007 2006 2007 2006
£000 £000 £000 £000
Cash and cash equivalents per 6,757 6,524 5,256 5,208
balance sheet
Bank overdrafts per balance sheet (287) (272) (3,187) (1,513)
Cash and cash equivalents per 6,470 6,252 2,069 3,695
cash flow statements
Overdrafts are secured by an unlimited multilateral guarantee between the UK
trading companies.
6 Other interest-bearing loans and borrowings
This note provides information about the contractual terms of the Group and
Company's interest-bearing loans and borrowings.
Current Non-Current
Initial Loan Value
Company Rate Maturity 2007 2006 2007 2006
£'000 £'000 £'000 £'000
Acquisition Libor +0.95% 2007 36 76 - 38
S$2.15m
Acquisition Libor +0.95% 2008 176 199 88 299
S$3.45m
Acquisition Libor +0.90% 2008 195 195 98 293
£1.95m
Acquisition Libor +0.95% 2009 217 222 272 499
SEK30m
Acquisition Libor +0.91% 2012 1,072 1,072 12,589 9,860
£11.2m
1,696 1,764 13,047 10,989
Other Group
Acquisition Libor +0.80% 2011 1,032 1,167 3,347 4,951
$21.78m
Funding $0.25m Libor +2% 2007 61 69 - -
Funding $0.10m Fixed 8% 2009 6 8 - 10
1,099 1,244 3,347 4,961
Total Group 2,795 3,008 16,394 15,950
All the bank loans, with the exception of the $0.25 million (funded in
Singapore) and £0.10 million (funded in America) loans included in the table
above are secured by an unlimited multilateral guarantee between the UK trading
companies.
7 Capital and reserves
Reconciliation of movement in capital and reserves - Group
Share Share Translation Revaluation Retained Total
capital premium reserve Reserve Earnings equity
£000 £000 £000 £000 £000 £000
Balance at 1
April 2005 3,595 4,598 (1,068) 465 30,353 37,943
Total
recognised
income and
expense - - 1,474 - 1,438 2,912
Issue of 624 7,650 - - - 8,274
shares
Share issue
expenses - (375) - - - (375)
Equity-settled
share based
payment - - - - 121 121
transactions
Dividends - - - - (1,630) (1,630)
Balance at 31
March 2006 4,219 11,873 406 465 30,282 47,245
Balance at 1
April 2006 4,219 11,873 406 465 30,282 47,245
Total
recognised
income and
expense - - (1,497) - 3,973 2,476
Issue of 17 173 - - - 190
shares
Equity-settled
share based
payment - - - - 213 213
transactions
Dividends - - - - (1,899) (1,899)
Balance at 31
March 2007 4,236 12,046 (1,091) 465 32,569 48,225
The revaluation reserve relates to properties revalued prior to date of
transition to IFRS.
The translation reserve comprises all foreign exchange differences arising from
the translation of foreign operations, as well as from the translation of
liabilities that hedge the Company's net investment in foreign subsidiaries.
Reconciliation of movement in capital and reserves - Company
Share Share Merger Revaluation Retained Total
capital premium reserve reserve earnings equity
£000 £000 £000 £000 £000 £000
Balance at 1 April
2005 3,595 4,598 2,393 393 3,367 14,346
Total recognised
income and expense - - - - 893 893
Issue of shares 624 7,650 - - - 8,274
Share issue
expenses - (375) - - - (375)
Equity-settled
share based
payment - - - - 76 76
transactions
Dividends - - - - (1,630) (1,630)
Balance at 31
March 2006 4,219 11,873 2,393 393 2,706 21,584
Balance at 1 April
2006 4,219 11,873 2,393 393 2,706 21,584
Total recognised
income and expense - - - - 2,449 2,449
Issue of shares 17 173 - - - 190
Equity-settled
share based
payment - - - - 125 125
transactions
Dividends - - - - (1,899) (1,899)
Balance at 31
March 2007 4,236 12,046 2,393 393 3,381 22,449
7 Capital and reserves (continued)
The merger reserve has arisen under Section 131 Companies Act 1985 and is a
non-distributable reserve.
The revaluation reserve relates to properties revalued prior to date of
transition to IFRS.
Share capital
in thousands of shares Ordinary shares
2007 2006
000 000
On issue at 1 April 84,380 71,892
Issued for cash 328 12,488
On issue at 31 March - fully paid 84,708 84,380
2007 2006
£000 £000
Allotted, called up and fully paid
Ordinary shares of 5p each 5,000 5,000
Allotted, called up and fully paid
Ordinary shares of 5p each 4,236 4,219
During the year 327,561 ordinary shares of 5p were issued upon the exercising of
Employee Share Options. 28,366 SAYE options were granted on 1 October 2002, at
an exercise price of £0.50 per share and 59,195 SAYE options were granted on 1
October 2003 at an exercise price of £0.60. 190,000 Executive options were
granted on 31st July 2002, at an exercise price of £0.50 per share and 50,000
Executive options were granted on 2nd July 2003 at an exercise price of £0.65
per share.
The holders of ordinary shares are entitled to receive dividends as declared
from time to time and are entitled to one vote per share at meetings of the
Company.
Dividends
During the year the following dividends were declared and paid by the Group.
2007 2006
£000 £000
Final paid 2006 - 1.48p (2005: 1.41p) per qualifying ordinary
share 1,249 1,014
Interim paid 2007 - 0.77p (2006: 0.73p) per qualifying
ordinary share 650 616
1,899 1,630
After the balance sheet date a final dividend of 1.66p per qualifying ordinary
share (2006: 1.48p) was proposed by the Directors. These dividends have not been
provided for.
2007 2006
£000 £000
Final 2007 - 1.66p (2006: 1.48p) per qualifying ordinary share 1,406 1,249
8 Earnings per share
Basic earnings per share
The calculation of basic earnings per share at 31 March 2007 was based on the
profit attributable to ordinary shareholders of £3,973,000 (2006: £1,438,000)
and a weighted average number of ordinary shares outstanding during the year
ended 31 March 2007 of 84,459,931 (2006: 77,516,115), calculated as follows:
Weighted average number of ordinary shares
2007 2006
Issued ordinary shares at 1 April 84,380,474 71,891,969
Effect of shares issued 79,457 5,624,146
Weighted average number of ordinary shares at 31
March 84,459,931 77,516,115
Diluted earnings per share
The calculation of diluted earnings per share at 31 March 2007 was based on
profit attributable to ordinary shareholders of £3,973,000 (2006: £1,438,000)
and a weighted average number of ordinary shares outstanding during the year
ended 31 March 2007 of 84,584,980 (2006: 77,639,682), calculated as follows:
Weighted average number of ordinary shares (diluted)
2007 2006
Weighted average number of ordinary shares at 31
March 84,459,931 77,516,115
Effect of share options on issue 125,049 123,567
Weighted average number of ordinary shares (diluted)
at 31 March 84,584,980 77,639,682
The average market value of the Company's shares for the purposes of calculating
the diluted effect of share options was based on quoted market prices for the
period that the options were outstanding.
2007 2006
EPS EPS
Earnings Basic Diluted Earnings Basic Diluted
£000 £000
Profit for the
financial 3,973 4.70p 4.70p 1,438 1.86p 1.85p
Year
Adjustments:
Goodwill impairment - - - 786 1.01p 1.01p
Restructuring costs 2,894 3.43p 3.42p 2,108 2.72p 2.72p
Tax charge on
adjusted (698) (0.83p) (0.83p) (632) (0.82p) (0.82p)
Items
6,169 7.30p 7.29p 3,700 4.77p 4.76p
The 'Adjusted diluted' earnings per share is detailed in the above table. In the
Directors' opinion, this best reflects the underlying performance of the Group
and assists in the comparison with the results of earlier years.
9 The financial information in this announcement which was approved by the Board
of Directors and does not constitute the Company's statutory accounts for the
years ended 31 March 2006 or 2007 but is derived from those accounts. Statutory
accounts for 2006 have been delivered to the Registrar of Companies and those
for 2007 will be delivered following the Company's Annual General Meeting. The
auditors have reported on those accounts; their reports were unqualified and did
not contain statements under Section 237(2) of the Companies Act 1985.
This preliminary announcement has been prepared in accordance with the
accounting policies adopted under IFRS. The disclosures required by IFRS 1
"first-time adoption" of International Financial Reporting Standards" concerning
the transition from UK GAAP can be found in our interim report for 2005, a copy
of which can be found on our website www.trifast.com.
10 This statement is not being posted to shareholders. The Report & Accounts for
the year ended 31 March 2007 will be posted to shareholders in July 2007.
Further copies will be available from Penny Williams at the Company's Registered
Office: Trifast House, Bellbrook Park, Uckfield, East Sussex, TN22 1QW.
11 The Annual General Meeting will be held on 27 September 2007 at 12.00 noon,
at the Company's Registered Office as above.
This information is provided by RNS
The company news service from the London Stock Exchange
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