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Thorpe(F.W.) PLC (TFW)

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Thursday 15 March, 2018

Thorpe(F.W.) PLC

Interim Results

RNS Number : 7679H
Thorpe(F.W.) PLC
15 March 2018
 

F W Thorpe Plc

 

INTERIM RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2017

 

F W Thorpe Plc - a group of companies that design, manufacture and supply professional lighting systems - is pleased to announce its interim results for the six months ended 31 December 2017.

 

Key points:


Interim

2018

Interim

2017


Revenue

£53.2m 

£51.2m 

3.8% increase

Operating profit

£7.8m 

£7.8m 

0.7%  increase

Profit before tax

£7.9m 

£7.8m 

0.9%  increase

Basic earnings per share

5.43p

5.38p

0.9%  increase

·       Performance of most Group companies was similar to the record figures of 2017

·       Famostar acquisition completed in December for initial consideration of €7.6m

·       Interim dividend increased to 1.40p (Interim 2017: 1.35p)

 

 

 

 

 

 

For further information, please contact:                                                                           

F W Thorpe Plc

 

Mike Allcock - Chairman and Joint Chief Executive

01527 583200

Craig Muncaster - Joint Chief Executive and Group Financial Director

01527 583200

N+1 Singer - Nominated Adviser

 

Richard Lindley

020 7496 3000

 

 

 



CHAIRMAN'S INTERIM STATEMENT

 

The Group started this financial year reasonably well, and at the halfway point had increased revenues by 3.8% and operating profit by 0.7%. Order income did not reach the record highs of 2016/17, making a further record-breaking full year result a challenge, as indicated in my update at the time of our AGM in November 2017.

 

Following the rebranding of Compact Lighting as Thorlux, Thorlux now has the benefit of additional retail revenue, which is now making a small contribution. Elsewhere, the majority of Group businesses performed in line with or ahead of last year, with the exception of TRT, where orders increased but margins reduced due to market pressure on selling prices. Improvements at TRT are underway for the second half of this financial year.

 

Certain overseas operations performed well, with a particularly positive contribution from those in the UAE and Australia. Lightronics delivered a large-scale project in Rotterdam and its performance is in line with that of last year.

 

Famostar, an emergency lighting specialist in the Netherlands, was welcomed to the Group. Within the Group, we see this as a complementary addition to the Lightronics operation, improving Lightronics' product offering and giving the opportunity to share Group technology in the future.

 

Having completed the new TRT factory and surface mount technology (SMT) electronics assembly line, the Group is now turning its attention to other areas. In January, the Group acquired the Lightronics factory and neighbouring property for €3.4m, providing a stable footing for expansion. On this site, the Group plans to build its European Application Centre, similar to the very successful Thorlux centre in the UK. It will showcase Lightronics, Thorlux and other Group products and systems.

 

Product development is a foundation of all Group businesses and continues apace. At Thorlux, additional SmartScan wireless lighting system features were launched, as planned. In addition, a raft of new and improved luminaires will appear on individual business websites before the end of the current financial year.

 

The results for the six months to 31 December 2017 allow for an increased dividend of 1.40p (Interim 2017: 1.35p), representing a 3.7% increase.

 

It remains a challenge to maintain last year's result, in spite of the interim performance. Revenue and profits should be bolstered by the addition of Famostar in the second half of the year; however, whilst the Group will endeavour to reach record levels, it seems unlikely.

 

Within the Group we will, of course, continue to work on and invest in projects that support our vision of stable long-term growth into the future.

 

 

 

Mike Allcock

Chairman

 

15 March 2018

F W Thorpe Plc



CONSOLIDATED INCOME STATEMENT

for the six months to 31 December 2017

 






31.12.17

(six months to)

31.12.16 

(six months to)

30.06.17 

(twelve months to)






(unaudited)

(unaudited)

(audited)






£'000 

£'000 

£'000 





Revenue

53,170  

51,236  

105,448 





Operating Profit

7,829  

7,775  

18,422 





Finance income

338  

307  

535 

Finance costs

(285) 

(272) 

(784)

Share of profit of joint venture

-  

-  

178 





Profit before tax expense

7,882  

7,810  

18,351 





Tax expense

  (1,598) 

  (1,588) 

(3,851)





Profit for the period from continuing operations

6,284  

6,222  

14,500 





Profit for the period

6,284  

6,222  

14,500 





 

 

 

Dividend rate per share:




     Interim

1.40p

1.35p

1.35p

     Final

2.85p

 

 

                                                                                                           

 

 

Earnings per share

- basic

5.43p

5.38p

12.54p


- diluted

5.39p

5.35p

12.47p

 

 

 

 

 

GROUP STATEMENT OF COMPREHENSIVE INCOME

for the six months to 31 December 2017

 






31.12.17

(six months to)

31.12.16

(six months to)

30.06.17

(twelve months to)






(unaudited)

(unaudited)

(audited)






£'000 

£'000 

£'000 





Profit for the year

6,284 

6,222 

14,500 





Other comprehensive income








Items that may be reclassified to profit or loss




Revaluation of available-for-sale financial assets

 




     - Arising in period*

263

227

287





     - Reclassified in period





Exchange rate differences on translation of foreign operations








     - Arising in period

159 

192 

657 





     - Reclassified in period





Taxation

(45)

(43)

18 






377 

376 

962  









Items that will not be reclassified to profit or loss








Actuarial loss on pension scheme

(1,211)





Movement on unrecognised pension surplus

1,071 






(140)





Other comprehensive income for the year, net of tax

377 

376 

822













Total comprehensive income for the year

6,661 

6,598 

15,322





 

 

All comprehensive income is attributable to the owners of the company.

 

* The profit on items that may be reclassified to profit or loss of £263,000 is due to the increase in market value of available for sale financial assets.



CONSOLIDATED BALANCE SHEET

as at 31 December 2017


As at 

As at 

As at 


31.12.17 

31.12.16 

30.06.17 






(unaudited)

(unaudited)

(audited)

Assets

£'000 

£'000 

£'000 

Non-Current Assets




Property, plant and equipment

19,666 

17,570 

18,837 

Intangible assets

22,873 

15,465 

15,927 

Investment property

2,133 

2,219 

2,163 

Loans and receivables

6,306 

4,340 

3,058 

Equity accounted investments

936 

936 

936 

Available for sale financial assets

3,893 

3,574 

3,630 

Deferred tax assets

32 

19 


55,816 

44,136 

44,570 

Current assets




Inventories

20,913 

20,847 

22,592 

Trade and other receivables

22,607 

17,210 

18,995 

Other financial assets at fair value through profit or loss

389 

389 

389 

Loans and receivables

750 

Short term financial assets - deposits

9,856 

12,767 

16,981 

Cash and cash equivalents

28,417 

22,957 

24,678 

Total current assets

82,182 

74,170 

84,385 









Total Assets

137,998 

118,306 

128,955





Liabilities




Current liabilities




Trade and other payables

(18,056)

(15,804)

(17,826)

Current tax liabilities

(2,015)

(1,667)

(1,606)

Total current liabilities

(20,071)

(17,471)

(19,432)





Net current assets

62,111 

56,699 

64,953 





Non-current liabilities




Retirement benefit deficit

-

-

-

Other payables

(11,463)

(4,811)

(5,774)

Provisions for liabilities and charges

(1,619)

(1,171)

(1,537)

Deferred tax liabilities

(706)

(785)

(920)

Total non-current liabilities

(13,788)

(6,767)

(8,231)

Total liabilities

(33,859)

(24,238)

(27,663)









Net assets

104,139 

94,068 

101,292 





Equity attributable to owners of the company




Issued share capital

1,189 

1,189 

1,189 

Share premium account

902 

656 

656 

Capital redemption reserve

137 

137 

137 

Foreign currency translation reserve

2,422 

1,798 

2,263

Retained earnings

99,489 

90,288 

97,047 





Total equity

104,139 

94,068 

101,292 





                                                                 



GROUP STATEMENT OF CHANGES IN EQUITY

for the six months to 31 December 2017

 


Share Capital

Share Premium

Capital Redemption Reserve

Foreign Currency Translation Reserve

Retained Earnings

Total Equity









£'000 

£'000 

£'000 

£'000 

£'000 

£'000 








Balance at 30 June 2016

1,189

656

137

1,606

87,119

90,707








Comprehensive income







Profit for six months to 31 December 2016

-

-

-

-

  6,222

6,222 

Other comprehensive income

-

-

-

192

184

376 

Total comprehensive income

-

-

-

192

6,406

6,598 








Transactions with owners







Dividends paid to shareholders

-

-

-

-

(3,297)

(3,297)

Share-based payment charge

-

-

-

-

60 

60 

Total transactions with owners

-

-

-

-

(3,237)

(3,237)








Balance at 31 December 2016

1,189

656

137

1,798

90,288 

94,068 








Comprehensive income







Profit for six months to 30 June 2017

-

-

-

-

8,278 

8,278

Actuarial loss on pension scheme

-

-

-

-

(1,211)

 (1,211)

Movement on unrecognised pension surplus

-

-

-

-

1,071

1,071 

Revaluation of available-for-sale financial assets

-

-

-

-

60

60 

Movement on associated deferred tax

-

-

-

-

(7)

 (7)

Impact of deferred tax rate change

-

-

-

-

68

68 

Exchange rate differences on translation of foreign operations

-

-

-

465

-

465 

Total comprehensive income

-

-

-

465

8,259

8,724 








Transactions with owners







Dividends paid to shareholders

-

-

-

-

(1,561)

(1,561)

Share-based payment charge

-

-

-

-

61 

61 

Total transactions with owners

-

-

-

-

(1,500)

(1,500)








Balance at 30 June 2017

1,189

656

137

2,263

97,047 

101,292 








Comprehensive income







Profit for six months to 31 December 2017

-

-

-

-

6,284

6,284 

Other comprehensive income

-

-

-

159

218

377 

Total comprehensive income

-

-

-

159

6,502

6,661 








Transactions with owners







Share options exercised

246

-

-

-

248 

Shares transferred from treasury

(2)

-

-

-

-

 (2)

Dividends paid to shareholders

-

-

-

-

(4,114)

(4,114)

Share-based payment charge

-

-

-

-

54 

54 

Total transactions with owners

-

246

-

-

(4,060)

(3,814)








Balance at 31 December 2017

1,189

902

137

2,422

99,489 

104,139 








 

GROUP STATEMENT OF CASH FLOWS

for the six months to 31 December 2017

 


31.12.17 

(six months to)

31.12.16 

(six months to)

30.06.17

(twelve months to)






(unaudited)

(unaudited)

(audited)


£'000 

£'000 

£'000 

Cash generated from operations




Profit before income tax

7,882 

7,810 

18,351

Adjustments for




- Depreciation charge

997 

781 

1,697

- Amortisation of intangibles & investment property

1,313 

947 

2,302

- Profit on disposal of property, plant and  equipment

(45)

(44)

    (119)

- Finance (income)/expense

(53)

(35)

249

- Retirement benefit contributions in excess of current and past service charge

(53)

(73)

(140)

- Share of profit from joint venture

(178)

- Share-based payment expense

166 

122 

337

- Research and development expenditure credit

(123)

(126)

(233)

- Effects of exchange rate movements

120 

(78)

113

Changes in working capital




- Inventories

2,623 

(1,919)

(3,646)

- Trade and other receivables

(2,469)

4,116 

2,156 

- Payables and provisions

(94)

(1,042)

1,491 

Cash generated from operations

10,264 

10,459 

22,380 





Tax paid

(1,351)

(1,823)

(3,840)





Cash flow from investing activities




Purchase of property, plant and equipment

(1,848)

(3,302)

(5,400)

Proceeds from sale of property, plant and equipment

79 

134 

262 

Purchase of intangibles

(939)

(782)

(2,148)

Purchase of subsidiary (net of cash acquired)

(5,922)

240 

Purchase of investment property

(122)

(100)

Net sale/(purchase) of available for sale financial assets

Property rental and similar income

27 

29 

31 

Dividend income

94 

104 

210 

Net sale/(purchase) of deposits

7,125 

2,143 

(2,071)

Interest received

202 

124 

393 

Net (issue)/receipt of loans notes

(118)

710 

1,090 

Net cash (used in)/generated from investing activities

(1,300)

(961)

(7,488)





Cash flow from financing activities




Net proceeds from the issuance of ordinary shares

248 

Dividends paid to company shareholders

(4,114)

(3,297)

(4,858)

Net cash used in financing activities

(3,866)

(3,297)

(4,858)





Effects of exchange rate changes on cash

(8)

284 

189 





Net increase/(decrease) in cash and cash equivalents

3,739 

4,662 

6,383 





Cash and cash equivalents at the beginning of the period

24,678 

18,295 

18,295 

Cash and cash equivalents at the end of the period

28,417 

22,957 

24,678 

      

 

 

 

 

 

Notes to the Interim Financial Statements

 

1.   Basis of Preparation

       The consolidated interim financial statements for the six months to 31 December 2017 have been prepared in accordance with the recognition and measurement principles of applicable International Financial Reporting Standards as adopted by the European Union (IFRSs as adopted by the EU), IFRIC interpretations and the AIM Rules for Companies. 

       The figures for the period to 31 December 2017 and the comparative period to 31 December 2016 have not been audited or reviewed and are therefore disclosed as unaudited.  The figures for 30 June 2017 have been extracted from the financial statements for the year to 30 June 2017, which have been delivered to the Registrar of Companies.  The interim financial statements do not constitute statutory accounts within the meaning of the Companies Act 2006.

       The financial statements are presented in Pounds Sterling, rounded to the nearest thousand.

       The interim financial statements are prepared under the historical cost convention, modified by the revaluation of certain current and non-current investments at fair value through profit or loss.

       The accounting policies set out in the financial statements for the year ended 30 June 2017 have been applied consistently throughout the Group during the period.

 

2.   Segmental analysis

The segmental analysis is presented on the same basis as that used for internal reporting purposes.  For internal reporting F W Thorpe is organised into nine operating segments, based on the products and customer base in the lighting market - the largest business is Thorlux, which manufactures professional lighting systems for the industrial, commercial and controls markets.  During the period, Compact Lighting Limited has been incorporated into the Thorlux segment further to previous announcements. The Lightronics business is a material subsidiary and therefore disclosed separately. 

The seven remaining continuing operating segments have been aggregated into the 'other companies' segment based on their size, comprising the entities Philip Payne Limited, Solite Europe Limited, Portland Lighting Limited, TRT Lighting Limited, Thorlux LLC, Thorlux Australasia PTY Limited and Famostar B.V.

F W Thorpe's chief operating decision-maker (CODM) is the Group board.  The Group board reviews the Group's internal reporting in order to monitor and assess the performance of the operating segments for the purpose of making decisions about resources to be allocated.  Performance is evaluated based on a combination of revenue and operating profit.  Assets and liabilities have not been segmented which is consistent with the Group's internal reporting.

Inter-segment adjustments to operating profit consist of property rentals on premises owned by FW Thorpe Plc, adjustments to profit related to stocks held within the Group that were supplied by another segment.

 

 

2.     Segmental analysis (continued)

 


Thorlux

Lightronics

Other

Inter-

Total




Companies

Segment

Continuing





Adjust-

Operations





ments



£'000 

£'000 

£'000 

£'000 

£'000 

6 months to 31 December 2017






Revenue to external customers

32,298

10,210

10,662

53,170

Revenue to other Group companies

2,307

57

1,114

(3,478)







Total revenue

34,605

10,267

11,776

(3,478)

 53,170 







Operating Profit

5,948

1,102

782

(3)

7,829 







Finance income





338 

Finance expense





(285)

Share of loss in joint venture











Profit before tax expense





7,882 







 

6 months to 31 December 2016






Revenue to external customers

31,470

9,713

10,053

 51,236 

Revenue to other Group companies

1,530

136

1,913

(3,579)







Total revenue

33,000

9,849

11,966

(3,579)

 51,236 







Operating Profit

5,933

1,104

620

118 

7,775 







Finance income





307 

Finance expense





(272)

Share of loss in joint venture











Profit before tax expense





7,810 







 

Year to 30 June 2017






Revenue to external customers

65,323

19,243

20,882

105,488

Revenue to other group companies

3,794

304

4,364

(8,462)







Total revenue

69,117

19,547

25,246

(8,462)

105,448







Operating Profit

14,162

2,372

2,163

(275)

18,422







Finance expense





(249)

Share of profit in joint venture





178













Profit before tax expense





18,351







 

Comparative periods for the Other Companies segment include Compact Lighting Limited. For the current period Compact Lighting Limited is incorporated in the Thorlux segment following the reorganisation of this business in July 2017.

 

3.   Investment in Subsidiary

In December 2017, the Group acquired 100% of the share capital of Famostar B.V., an emergency lighting specialist in the Netherlands. The company was acquired by Lightronics Participaties B.V. for an initial consideration of €7.6m (circa £6.8m) with an estimated additional €0.5m (£0.4m) payable subject to performance conditions relating to EBITDA in 2017 and 2018.  Based on current best estimates, a further €2.7m (£2.4m) could be payable to the holders of share appreciation rights in Lightronics Participaties B.V. which is subject to future performance conditions linked to a significant increase in EBITDA over the next three years.

Amounts recognised in respect of this acquisition are:


€,000

Total identifiable assets

2,674

Goodwill

8,156

Total purchase consideration

10,830



Total purchase consideration satisfied by:


Cash

7,600

Contingent consideration: Famostar

500

Contingent consideration: Share appreciation rights

2,730

Total consideration

10,830



Net cash flow arising on acquisition


Cash consideration

7,600 

Less cash in subsidiary acquired

(931)

Cash outflow on acquisition

6,669 

 

4.   Earnings per share

       The basic earnings per share is calculated on profit after taxation and the weighted average number of ordinary shares in issue of 115,750,590 (Interim 2017: 115,675,590) during the period. 

The diluted earnings per share is calculated on profit after taxation and the weighted average number of potentially dilutive ordinary shares in issue of 116,502,118 (Interim 2017: 116,347,665) during the period.

      

  

5.   Dividend

       The interim dividend is at the rate of 1.40p per share (Interim 2017: 1.35p), and based on 115,875,590 shares in issue at the announcement date the dividend will amount to £1,622,000 (Interim 2017: £1,562,000).  The interim dividend will be paid on 12 April 2018 to shareholders on the register at the close of business on 23 March 2018, and the shares become ex-dividend on 22 March 2018.

A final dividend for the year ended 30 June 2017 of 3.55p (2016: final of 2.85p) per share, amounting to £4,114,000 (2016: £3,297,000) was paid on 30 November 2017.

 

6.   Events after the Balance Sheet Date

In January 2018, the Group acquired the property in the Netherlands occupied by its subsidiary, Lightronics Participaties B.V. for €3,400,000. 

 

7.   Availability of interim statement

       Copies of the interim report are being sent to shareholders and will also be available from the company's registered office or on the company's website (www.fwthorpe.co.uk) from 29 March 2018.


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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