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Havelock Europa PLC (HVE)

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Tuesday 04 April, 2006

Havelock Europa PLC

Final Results - Correction

Havelock Europa PLC
04 April 2006


                                                                                

The following replaces the Preliminary Announcement for the year ended 31
December 2005 released today at 07:00 under RNS number 8970A.

In the paragraph entitled Dividends, the record date will be 9 June 2006 and not
6 June 2006, as previously stated.

Please find below the full amended announcement.

  

Tuesday 4 April 2006

                  HAVELOCK EUROPA PLC - PRELIMINARY ANNOUNCEMENT                 
                                                                            

2005 was a year of further good progress for Havelock. Underlying pre-tax profit
increased substantially for a fourth successive year, with two of its three
Divisions (Retail Interiors and Point of Sale Display) performing strongly. The
third Division (Education Furniture and Supplies) prepared itself for an
expected increase in activity in 2006 and 2007.
 

Financial Highlights
 
   
  * Revenue increased by 16% to £100.2m.
   
  * Pre-tax profit increased by 49% to £6.0m (reported) and by 15% to £5.0m
    (underlying).
   
  * Basic fully diluted earnings per share were up 38% at 12.1p (reported) and
    up 8% at 10.3p (underlying).
   
  * Dividends per share are increased by 13% to 3.6p and are covered almost 3
    times by underlying EPS.

 

Commercial Highlights

 
   
  * The Retail Interiors Division delivered a significantly improved result,
    with revenue up 32% to £45.9m and profit substantially increased, as a
    result of the significant repositioning of its activities over the last two
    years. The Division's order book is above the seasonal norm, as a result of
    a high degree of activity in its retail customer base.

 
   
  * Education Furniture and Supplies revenue increased by 11% to £29.4m, after
    inclusion of a full year's activity from TeacherBoards and Clean Air.
    However, the volume of business in the PFI/PPP sector was static and profit
    was lower, also reflecting a build-up of additional costs in preparation for
    major programmes in 2006 and 2007. In 2006, the Division expects to benefit
    from substantially increased PFI/PPP business.

 
   
  * The Point of Sale Display Division increased its profit although revenue
    remained broadly the same at £24.9m. Further cost savings and an expansion
    of the Division's customer base are underway to counteract the expected
    reduction in Kwik Save business.

 
   
  * With a view to achieving further synergies between the education,
    healthcare and retail interiors businesses, since September, ESA McIntosh,
    Clean Air and Retail Interiors have been placed under the direction of
    Richard Lowery, a main Board Director and previously Managing Director of
    Retail Interiors.

 



Malcolm Gourlay, Chairman, said: 'The Group has made an encouraging start to the
year. The Board believes that further good progress will be made in the current
year as a whole.'

 

Presentation:

 

Today, from 09:30am to 10:30am, a presentation to broker's analysts will be held
at the offices of Bankside Consultants, 1 Frederick's Place, London EC2R 8AE.

 
Enquiries:                                                                        
                                                                                  
Havelock Europa PLC                                        01383-820 044
Hew Balfour (Chief Executive)                              07801-683 851
Grant Findlay (Finance Director)                           07768-745 960
                                                                                  
                                                                                  
Bankside Consultants Limited                                                      
Charles Ponsonby                                           020-7367 8851

 



                             PRELIMINARY STATEMENT                              

 

2005 was a year of further good progress for Havelock. Underlying pre-tax profit
increased substantially for a fourth successive year, with two of its three
Divisions (Retail Interiors and Point of Sale Display) performing strongly. The
third Division (Education Furniture and Supplies) prepared itself for an
expected increase in activity in 2006 and 2007.

 

FINANCIAL OVERVIEW

 

The figures have been prepared under International Financial Reporting Standards
('IFRS') and those for 2004 have been restated on a comparable basis.

 

Revenue increased by 16% to £100.2 million (2004: £86.5 million).

 

Pre-tax profit increased by 49% to £6.0 million (2004: £4.0 million).
Disregarding a non-recurring pension past service credit of £1.4 million (2004:
nil) and amortisation of intangibles, which were previously classified as
goodwill, of £0.4 million (2004: £0.3 million), underlying pre-tax profit
increased by 15% to £5.0 million (2004: £4.3 million).

 

Basic fully diluted earnings per share were 12.1p (2004: 8.7p), up 38%, and
10.3p (2004: 9.6p), up 8%, on an underlying basis.

 

2005 saw a strong performance from the Retail Interiors Division, as a result of
the significant repositioning of its activities over the last two years. Point
of Sale Display also traded better than last year, with the first benefits of
the integration of the Bristol and Letchworth sites, which commenced in July
2005, coming through in the last quarter. Revenue from Education Furniture and
Supplies increased, after inclusion of a full year's activity from the
businesses acquired in mid-2004, TeacherBoards and Clean Air, but, as
anticipated, profit was lower, reflecting a temporary lull in PFI/PPP school
refurbishment schemes and a build-up of additional costs in preparation for an
increased workload in 2006 and 2007.

 

Net debt reduced to £14.1 million (2004: £14.5 million), reflecting tight
working capital control, despite the payment in cash of deferred consideration
of £1.2 million and the issue of loan notes totalling £1.0 million in relation
to the two acquisitions made in 2004. Net cashflow from operations increased by
17% to £5.0m from £4.2m in 2004.

 

Under IFRS, retirement benefit obligations and the related deferred tax asset
are, for the first time, included in the Group Balance Sheet. At 31 December
2005, the net deficit was £5.4 million (2004: £6.0 million). The deficit reduced
in the year due to positive investment performance and the introduction of a cap
on future increases in pensionable salaries which generated a gain of £1.4
million, reflecting a reduction in the scheme's future liabilities.

 

DIVIDENDS

 

The Board is proposing a final dividend per share of 2.7p (2004: 2.4p). If
approved at the Annual General Meeting on 27 June 2006, the dividend will be
paid on 4 July 2006 to shareholders on the register at close of business on 9
June 2006.

 

Including the interim dividend per share of 0.9p (2004: 0.8p) paid on 28
December 2005, the proposed dividend per share for the year will total 3.6p
(2004: 3.2p), which is up 13% on 2004 and covered 2.9 times by underlying EPS.

 

 

TRADING REVIEW

 

Retail Interiors

 

The Retail Interiors Division delivered significantly improved results,
reflecting its strategy to concentrate on UK retailers and banks which require
and value a consistency of quality in manufacturing and service delivery.
Revenue rose by 32% to £45.9 million (2004 : £34.8 million). The principal
contributors were Primark (with whom business more than doubled), HBOS (whose
increased business was aided by the start of a programme to create a chain of
new branches for the Bank of Scotland in Ireland) and Boots The Chemists. Marks
& Spencer returned as a major customer for the first time since 2002. An
encouraging start has been made in the Healthcare sector, for which this
Division has responsibility.

 

Education Furniture & Supplies

 

As indicated in the Interim Announcement in September 2005, the Group's
education businesses started 2005 more slowly than originally expected, with a
particularly slow period around the time of the General and Local Elections.
Revenue rose to £29.4 million (2004 : £26.5 million), after inclusion of a full
year's activity from TeacherBoards and Clean Air. However, the volume of
business in the PFI/PPP sector was static and profit was lower, reflecting also
a build-up of additional costs in preparation for major programmes in 2006 and
2007. Clean Air, a manufacturer of fume cupboards for use in science
laboratories, suffered particularly from the lull in PFI/PPP refurbishment
schemes and a relative dearth of new university laboratory contracts.

 

Point of Sale Display

 

The Point of Sale Display Division increased its profit despite revenue
remaining broadly the same at
£24.9 million (2004 : £25.2 million). The capital investment in new technology
and the integration of the Bristol and Letchworth sites under one management
team led to a very strong second half and an excellent result for the year.
Somerfield/Kwik Save, Tesco and BHS remained amongst the Division's largest
customers.

 

STRATEGY

 

Havelock's strategy is to concentrate on UK markets offering significant
opportunities for profitable growth. With a view to achieving further synergies
between the education, healthcare and retail interiors businesses, ESA McIntosh,
Clean Air and Retail Interiors have been placed under the direction of Richard
Lowery, a main Board Director and previously Managing Director of Retail
Interiors. There has been a further restructuring of responsibilities under him
to provide improved customer service and a launch pad for the further
significant growth expected in the education sector over the next two years.

 

Specific attention is being given to the PFI/PPP sector, where the large
contract disciplines evolved in the Retail Interiors Division over many years
will be applied throughout the education, healthcare and retail interiors
businesses. As a result, there is likely to be further integration of these
businesses during the course of this year with the aim of securing an optimal
use of skills and experience.

 

A similar integration has already taken place in the Point of Sale Display
Division with a view to avoiding duplication of capital investment, maximising
the capacity of the two plants, significantly improving customer service levels
and, as a result, enabling the development of a wider customer base and a
reduction in dependence on large individual customers.

 

 

 

CURRENT TRADING AND PROSPECTS

 

The Group has made an encouraging start to the year.

 

The first three months of the year have seen the Retail Interiors Division
increase its order book above the seasonal norm, as a result of a high degree of
activity in its retail customer base. The development of a number of new stores
by Primark and the return of Marks & Spencer as a significant customer have
contributed to this busy start to the year. The award of additional work from
Bank of Scotland in Ireland, where further branches are scheduled to open during
2006, coupled with strong demand in both the primary and secondary healthcare
sectors, has reinforced the order book.

 

Within the education sector, letters of intent or orders have already been
received from 14 of the 16 PFI/PPP projects with which the Group expects to be
involved during 2006. Work is underway at school sites on 12 of these
projects.With activity in the factories at Dalgety Bay and Kirkcaldy already at
a high level, the total value of PFI/PPP business is expected to be materially
up on the invoiced turnover last year. Direct business with Local Authorities
remains solid.

 

The consolidation of the two Print facilities at Bristol and Letchworth is now
nearing completion. The announcement by Somerfield of the disposal of the
majority of its Kwik Save stores will result in a substantial reduction in the
expected level of turnover with the Somerfield group with effect from later this
month. This is likely to require a decrease in the workforce at Bristol and a
modification of shift patterns with a view to securing savings in overheads,
particularly in relation to factory space. This reduction of business at Bristol
has, however, in the first quarter, been partly offset by a strong performance
at Letchworth and an expansion in the Division's customer base as the effects of
recent investment in technology enhance product quality and productivity.

 

Although the Retail Interiors Division has had a robust start to the year, the
concentration of work in this sector is always strongly biased in favour of the
second half. Under IFRS, profit can only be recognised on major educational
contracts following installation, and the benefit of the upturn in activity will
not show through, in accounting terms, until the second half of the year. These
two factors mean that the Group's results will, as always, be very heavily
slanted towards the second half of the year. Nevertheless, the Board believes
that further good progress will be made by the Group in the current year as a
whole.

 

 

 

Malcolm Gourlay

Chairman 4 April 2006



 

                         CONSOLIDATED INCOME STATEMENT                          

                      for the year ended 31 December 2005                       
                                                                                
 

 
                                                                  2005        2004
                                                                  £000        £000
                                                    Note                          
                                                                                  
Revenue                                                        100,194      86,526
Cost of sales                                                 (78,790)    (69,988)
                                                               _______     _______
Gross profit                                                    21,404      16,538
Non-recurring pension curtailment                                1,389           -
Other administrative expenses                                 (15,290)    (10,996)
                                                               _______     _______
Operating profit before financing costs                          7,503       5,542
                                                               _______     _______
                                                                                  
Financial income - interest receivable                               -           4
Expected return on defined benefit pension plan                  1,259       1,070
assets                                                                            
Financial expenses - on bank borrowings and                    (1,616)     (1,366)
finance leases                                                                    
Interest on defined benefit pension scheme                     (1,411)     (1,325)
liabilities                                                                       
                                                               _______     _______
Net financing costs                                            (1,768)     (1,617)
                                                               _______     _______
Share of profit of associates                                      294         121
                                                                                  
                                                                                  
Profit before tax and non-recurring pension                      4,640       4,046
curtailment                                                                       
Non-recurring pension curtailment                                1,389           -
                                                                                  
Profit before tax                                                6,029       4,046
                                                                                  
Income tax expense                                   4         (1,839)     (1,152)
                                                               _______     _______
Profit for the year (attributable to equity                      4,190       2,894
holders of the parent)                                         _______     _______
                                                                                  
Basic earnings per share                             5           12.3p        9.1p
                                                                                  
Diluted earnings per share                           5           12.1p        8.7p

 

 

 



                                                                                

                                                                                

                   STATEMENT OF RECOGNISED INCOME AND EXPENSE                   

                      for the year ended 31 December 2005                       
                                                                                
 

                                                           2005     2004        
                                                           £000     £000        
                                                 Note                           
        Exchange differences on translation of    10         63     (42)        
        overseas associate                                                      
        Actuarial losses on defined benefit             (1,039)    (975)        
        pension plan                                                            
        Tax on items taken directly to equity               312      292        
        Cash flow hedges:                                                       
        Effective portion of changes in fair      10      (153)        -        
        value                                                                   
                                                        _______  _______        
        Net expense recognised directly in                (817)    (725)        
        equity                                                                  
                                                                                
        Profit for the year                               4,190    2,894        
                                                        _______  _______        
                                                                                
        Total recognised income and expense       10      3,373    2,169        
        (attributable to equity holders of the                                  
        parent)                                                                 
                                                                                
        Effect of change in accounting policy                                   
                                                                                
        Effect of adoption of IAS 32 and IAS 39                                 
        net of tax on 1 January 2005 (with 2004                                 
        not restated) on cash flow hedge reserve                                
                                                          (165)        -        
                                                        _______  _______        
                                                          3,208    2,169        

 

.



                                                                                

                                                                                

                                                                                

                           CONSOLIDATED BALANCE SHEET                           

                             as at 31 December 2005                             
                                                                                
                                                           £000     £000        
                                                Note       2005     2004        
       Assets                                                                   
       Non-current assets                                                       
       Property, plant and equipment                     12,902   13,687        
       Intangible assets                                 12,852   14,467        
       Investments in associates                              -      612        
       Deferred tax assets                                2,318    2,583        
                                                        _______  _______        
       Total non-current assets                          28,072   31,349        
                                                        _______  _______        
       Current assets                                                           
       Inventories                                6       8,923    9,629        
       Trade and other receivables                7      20,261   16,777        
       Cash and cash equivalents                          2,089      627        
                                                        _______  _______        
       Total current assets                              31,273   27,033        
                                                                                
       Non-current assets classified as held                842        -        
       for sale                                                                 
                                                        _______  _______        
       Total assets                               3      60,187   58,382        
                                                        _______  _______        
       Liabilities                                                              
       Current liabilities                                                      
       Interest-bearing loans and borrowings      8     (6,817)  (1,322)        
       Derivative financial instruments                   (318)        -        
       Income tax payable                                 (590)    (954)        
       Trade and other payables                   9    (22,069) (21,112)        
                                                        _______  _______        
       Total current liabilities                       (29,794) (23,388)        
                                                        _______  _______        
       Non-current liabilities                                                  
       Interest-bearing loans and borrowings      8     (9,331) (13,842)        
       Retirement benefit obligations                   (7,725)  (8,610)        
       Other payables                             9           -  (1,426)        
       Deferred tax liabilities                         (1,072)    (838)        
                                                        _______  _______        
       Total non-current liabilities                   (18,128) (24,716)        
                                                        _______  _______        
       Total liabilities                          3    (47,922) (48,104)        
                                                        _______  _______        
       Net assets                                        12,265   10,278        
                                                        _______  _______        
       Equity                                                                   
       Issued share capital                      10       3,479    3,430        
       Share premium                             10       1,987    1,808        
       Other reserves                            10       2,881    3,136        
       Revenue reserves                          10       3,918    1,904        
                                                        _______  _______        
       Total equity attributable to equity               12,265   10,278        
       holders of the parent                                                    
                                                        _______  _______        

 

 

 



                                                                                

                                                                                

                        CONSOLIDATED CASH FLOW STATEMENT                        

                      for the year ended 31 December 2005                       

 

                                                            2005     2004       
                                                            £000     £000       
      Cash flows from operating activities        Note                          
      Profit before tax                                    6,029    4,046       
      Adjustments for:                                                          
      Depreciation of property, plant and                  1,826    1,772       
      equipment                                                                 
      Amortisation of intangible assets                      510      452       
      Gain on sale of property, plant and                   (26)     (30)       
      equipment                                                                 
      Net financing costs                                  1,768    1,617       
      Share of profit of associates                        (294)    (121)       
                                                                                
      Operating cash flows before changes in                9813    7,736       
      working capital and provisions                                            
                                                                                
                                                                                
      (Increase)/decrease in trade and other             (3,484)      224       
      receivables                                                               
      Decrease/(increase) in inventories                     706  (1,411)       
      Increase in trade and other payables                 2,954      638       
      Movement relative to defined benefit               (1,924)    (593)       
      pension scheme                                                            
      IFRS 2 charge relating to equity settled                70       93       
      plans                                                                     
                                                         _______  _______       
      Cash generated from operations                       8,135    6,687       
                                                         _______  _______       
      Interest paid                                      (1,768)  (1,205)       
      Income taxes paid                                  (1,392)  (1,244)       
                                                         _______  _______       
      Net cash from operating activities                   4,975    4,238       
                                                         _______  _______       
      Cash flows from investing activities                                      
      Proceeds from sale of property, plant and               26       84       
      equipment                                                                 
      Acquisition of property, plant and                 (1,041)  (2,856)       
      equipment                                                                 
      Acquisition of intangible assets                     (125)     (51)       
      Acquisition of subsidiaries, net of cash           (1,185)  (6,256)       
      balances acquired                                                         
      Dividends received from associate                      127        -       
                                                         _______  _______       
      Net cash from investing activities                 (2,198)  (9,079)       
                                                         _______  _______       
      Cash flows from financing activities                                      
      Proceeds from the issue of share capital               228    1,656       
      Increase in bank loans                               1,244    4,650       
      Movements in relation to purchase of own             (374)       95       
      shares                                                                    
      Repayment of bank borrowings                       (1,250)  (1,250)       
      Repayment of finance lease liabilities                (72)    (103)       
      Dividends paid                               10    (1,145)    (928)       
                                                         _______  _______       
      Net cash from financing activities                 (1,369)    4,120       
                                                         _______  _______       
      Net Increase/(decrease) in cash and cash             1,408    (721)       
      equivalents                                                               
      Cash and cash equivalents at 1 January                 627    1,348       
                                                         _______  _______       
      Cash and cash equivalents at 31 December             2,035      627       
                                                         _______  _______       

 



 

 

                            NOTES TO THE STATEMENTS                             

                                                                                

                                                                                

 

1. The financial information set out above does not constitute the Company's
statutory accounts for the years ended 31 December 2005 or 2004 but is derived
from the 2005 accounts. Statutory accounts for 2004, which were prepared under
UK GAAP, have been delivered to the Registrar of Companies, and those for 2005,
prepared under International Financial Reporting Standards (IFRS) as adopted for
use in the EU, will be delivered in due course. The auditors have reported on
those accounts; their reports were (i) unqualified, (ii) did not include
references to any matters to which the auditors drew attention by way of
emphasis without qualifying their reports and (iii) did not contain statements
under section 237(2) or (3) of the Companies Act 1985.


2. Basis of consolidation

 

The consolidated financial statements comprise Havelock Europa PLC and its
subsidiaries, together with the Group's share of the results of its associate.
The financial statements of subsidiaries and its associate are prepared to the
same reporting date using accounting policies consistent with those of the
parent company. Intra-group transactions and balances, including any unrealised
gains and losses or income and expenses, arising from intra-group transactions
are eliminated in full.

 

3. Segment reporting

Segment information is presented in respect of the Group's business and
geographical segments. The primary format, business segments, is based on the
Group's management and internal financial 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.
Unallocated items mainly comprise interest-bearing loans and borrowings,
deferred consideration payable for business combinations, income taxes and
corporate assets, liabilities and expenses.

 

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.

 

Business segments

 

The Group comprises the following business segments, all of which are continuing
operations:

 
•       Retail - design, manufacture and installation of interiors for retailers, 
banks, hotels and healthcare premises;                                            
                                                                                  
•       Education - design, manufacture and installation of science labs and      
fitted furniture, teaching aids, display boards and fume cupboards for the        
education sector;                                                                 
                                                                                  
•       Point of sale display - printing of promotional graphics and manufacture  
of display equipment for use in retail and branded goods businesses.              

 



 
Business segments         Retail       Education   Point of sale  Elimination   Consolidated    
                                                      display                                 
                         2005   2004   2005   2004   2005   2004  2005  2004    2005    2004  
                         £000   £000   £000   £000   £000   £000  £000  £000    £000    £000  
                                                                                              
Revenue from external  45,896 34,799 29,386 26,504 24,912 25,223     -     - 100,194  86,526  
customers                                                                                     
Inter-segment revenue     148    327    102     24    415    325 (665) (676)       -       -  
Total revenue          46,044 35,126 29,488 26,528 25,327 25,548 (665) (676) 100,194  86,526  
                                                                                              
Segment result before   1,476    167  2,867  3,358  3,549  3,245     -     -   7,892   6,770  
pension credit                                                                                
Pension credit          1,016      -      -      -    165      -     -     -   1,181       -  
Segment result after    2,492    167  2,867  3,358  3,714  3,245     -     -   9,073   6,770  
pension credit                                                                                
Unallocated pension                                                            208         -  
credit                                                                                        
Unallocated expenses                                                         (1,778) (1,228)  
Profit from operations                                                         7,503   5,542  
before financing costs                                                                        
Net financing costs                                                          (1,768) (1,617)  
Share of profit from                                                             294     121  
associates                                                                                    
Income tax expense                                                           (1,839) (1,152)  
Profit for the year                                                            4,190   2,894  
                                                                                              
Segment assets         15,953 14,118 23,081 25,241 13,508 12,987     -     -  52,542  52,346  
Investment in                                                                      -     612  
associates                                                                                    
Assets classified as                                                             842       -  
held for sale*                                                                                
Unallocated assets                                                             6,803   5,424  
Total assets                                                                  60,187  58,382  
                                                                                              
  * included as investment in associates in 2004                                              

                                                                                
Segment          (15,277) (13,290) (3,499) (3,705) (4,938) (5,133)  -  - (23,714) (22,128)
liabilities                                                                               
Unallocated                                                              (24,208) (25,976)
liabilities                                                                               
Total                                                                    (47,922) (48,104)
liabilities                                                                               
                                                                                          
Capital             (209)    (674)   (304)   (349)   (603) (1,826)  -  -  (1,116)  (2,849)
expenditure                                                                               
Unallocated                                                                  (50)        -
capital                                                                                   
expenditure                                                                               
Depreciation        (548)    (585)   (443)   (363)   (773)   (751)  -  -  (1,764)  (1,699)
Unallocated                                                                  (62)     (73)
depreciation                                                                              
Amortisation of      (54)     (47)   (400)   (343)    (35)    (39)  -  -    (489)    (429)
intangible                                                                                
assets                                                                                    
Unallocated                                                                  (21)     (23)
amortisation of                                                                           
intangible                                                                                
assets                                                                                    
Other non-cash                                                                            
expenses                                                                                  
Gain/ (loss) on         -        9    (18)    (12)     (8)    (27)  -  -     (26)     (30)
sale of property                                                                          
plant and                                                                                 
equipment                                                                                 

 



4. Income tax expense

 

Recognised in the income statement

 
                                                             2005     2004
                                                             £000     £000
Current tax expense                                                       
Current year                                              (1,028)  (1,181)
Adjustments for prior years                                     -     (13)
                                                          (1,028)  (1,194)
                                                                          
Deferred tax expense                                                      
Origination and reversal of temporary                       (737)       92
differences                                                               
Adjustments for prior years                                  (74)     (50)
                                                            (811)       42
                                                                          
Total income tax expense in the consolidated              (1,839)  (1,152)
income statement                                                          

 

 

5. Earnings per share

 

 

The calculation of basic earnings per share and underlying earnings per share at
31 December 2005 is based on the profit attributable to ordinary shareholders as
follows:

 

 

 
                                                    2005      2004      2005     2004
                                                Earnings  Earnings       EPS      EPS
                                                    £000      £000     pence    pence
Basic                                              4,190     2,894      12.3      9.1
Adjusted for:                                                                        
Non-recurring pension curtailment gain           (1,389)         -     (4.0)        -
Tax relief thereon                                   417         -       1.2        -
Amortisation of intangibles formerly                 368       291       1.1      1.0
classified as goodwill                                                               
Adjusted                                           3,586     3,185      10.6     10.1
Diluted basic                                                           12.1      8.7
Diluted adjusted                                                        10.3      9.6

 
                                                                       2005     2004
                                                                       £000     £000
Total amortisation                                                      510      452
Less amortisation of computer software                                (142)    (161)
Amortisation of intangibles formerly classified as goodwill             368      291

 

 

The weighted average number of shares used in each calculation is as follows:

 

Basic earnings per share

 
                                                                                    
In thousands of shares                                                 2005     2004
                                                                                    
Issued ordinary shares at 1 January                                  34,300   31,069
Effect of own shares held                                             (673)    (967)
Effect of shares issued in 2004                                           -    1,536
Effect of shares issued in 2005                                         351        -
Weighted average number of ordinary shares at 31                     33,978   31,638
December                                                                            

 



Diluted earnings per share

 
                                                                             
                                                                             
                                                                             
In thousands of shares                                           2005    2004
                                                                             
Weighted average number of ordinary shares at 31               33,978  31,638
December                                                                     
Effect of share options on issue                                  713   1,540
Weighted average number of ordinary shares (diluted)           34,691  33,178
at 31 December                                                               

 

6. Inventories

                                                                 2005    2004
                                                                 £000    £000
Raw materials and consumables                                   3,371   3,312
Work in progress                                                2,176   1,454
Finished goods                                                  3,376   4,863
                                                                8,923   9,629

 

Inventories are shown net of write-downs amounting to £597,000 (2004: £307,000)

 

7. Trade and other receivables

                                                                 2005    2004
                                                                 £000    £000
Trade receivables                                              18,761  15,429
Other receivables                                                 336     340
Prepayments                                                     1,164   1,008
Amounts owed by group undertakings                                  -       -
                                                               20,261  16,777

 

An allowance has been made for estimated irrecoverable amounts from the sale of
goods of £388,000 (2004: £211,00)

 

8. Interest-bearing loans and borrowings

 

Current liabilities

                                                                 2005    2004
                                                                 £000    £000
Bank overdraft                                                     54       -
Secured bank loans                                              5,705   1,250
Loan notes                                                      1,008       -
Obligations under hire purchase contracts and finance leases       50      72
                                                                6,817   1,322

 

Non-current liabilities

                                                                 £000    £000
Secured bank loans and overdraft                                9,331  13,792
Obligations under hire purchase contracts and finance leases        -      50
                                                                9,331  13,842

 



Finance lease liabilities are payable as follows:

 

 
                         Minimum                       Minimum                    
                           lease                         lease                    
                        payments  Interest Principal  payments  Interest Principal
                            2005      2005      2005      2004      2004      2004
                            £000      £000      £000      £000      £000      £000
Less than one year            51         1        50        77         5        72
Between one and five           -         -         -        51         1        50
years                                                                             
                              51         1        50       128         6       122
                                                                                  

 

 

9. Trade and other payables

 

Amounts disclosed in current liabilities

                                                                  2005      2004
                                                                  £000      £000
Trade payables                                                  15,222    14,125
Other taxes and social security                                  3,441     2,584
Accruals                                                         3,160     2,180
Deferred consideration relating to business combinations           246     2,223
                                                                22,069    21,112

 

Amounts disclosed in non-current liabilities

                                                                  2005      2004
                                                                  £000      £000
Deferred consideration relating to business combinations             -     1,426

 

10. Reconciliation of movement in capital and reserves

 
                             Share    Share  Merger  Trans- Hedg-ing   Other Revenue   Total
                           capital prem-ium reserve  lation  reserve reserve reserve        
                                                    reserve                                 
                              £000     £000    £000    £000     £000    £000    £000    £000
Balance at 1 January 2004    3,107      307     602       -        -     994     514   5,524
Total recognised income          -        -       -    (42)        -       -   2,211   2,169
and expense for the period                                                                  
Movements relating to            -        -       -       -        -       -     107     107
share-based payments and                                                                    
ESOP trust                                                                                  
Shares issued                  323    1,501   1,582       -        -       -       -   3,406
Dividends to shareholders        -        -       -       -        -       -   (928)   (928)
Balance at 31 December       3,430    1,808   2,184    (42)        -     994   1,904  10,278
2004                                                                                        
                                                                                            
Implementation of IAS 32         -        -       -       -    (165)       -       -   (165)
and IAS 39                                                                                  
Balance at 1 January 2005    3,430    1,808   2,184    (42)    (165)     994   1,904  10,113
Total recognised income          -        -       -      63    (153)       -   3,463 3,373  
and expense for the period                                                                  
Movements relating to                             -       -        -       -   (304)  (304) 
share-based payments and                                                                    
ESOP trust                                                                                  
Shares issued                   49      179       -       -        -       -       -     228
Dividends to shareholders        -        -       -       -                - (1,145) (1,145)
Balance at 31 December       3,479    1,987   2,184      21    (318)     994   3,918  12,265
2005                                                                                        

 

 

11. The accounts for the year ended 31 December 2005 were approved by the
Directors on 4 April 2006.



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