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Van Elle HoldingsPLC (VANL)

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Thursday 25 January, 2018

Van Elle HoldingsPLC

Half-year Report

RNS Number : 8578C
Van Elle Holdings PLC
25 January 2018
 

 

Van Elle Holdings plc

 

For Immediate Release

                  25 January 2018

 

Interim Results for the six months ended 31 October 2017

 

Van Elle Holdings plc ("Van Elle", the "Company" or the "Group"), the AIM quoted geotechnical engineering contractor offering a wide range of ground engineering techniques and services to customers in a variety of UK construction end markets, announces its interim results for the six months ended 31 October 2017.

 

Highlights

 

6 months ended 31 Oct 2017

6 months ended 31 Oct 2016

Growth %

Revenue (£m)

52.6

43.1

22.1

Underlying* EBITDA (£m)

8.4

7.1

18.7

Reported EBITDA (£m)

8.3

5.6

47.8

Underlying* operating profit (£m)

5.7

4.9

15.6

Reported operating profit (£m)

5.6

3.4

62.0

Underlying* profit before taxation (£m)

5.4

4.7

15.4

Reported profit before taxation (£m)

5.3

3.2

64.8

Underlying* earnings per share (p)

5.4

5.2

3.8

Reported earnings per share (p)

5.3

3.2

65.6

Dividend per share (p)

1.4

0.85

 

Operating cash conversion (%)

86.9%

46.9%

 

Return on capital employed (%)

25.8%

27.2%

 

* before share-based payments and exceptional costs

Summary highlights

·      Trading in the first half of the year has been positive reflecting the increased service offering with new techniques, rigs and geographical presence.

·      Group revenue increased by 22.1% to £52.6m (H1 2016: £43.1m), with revenue growth in all four Divisions.

·      Underlying EBITDA increased by 18.7% to £8.4m (H1 2016: £7.1m) and underlying operating profit increased by 15.6% to £5.7m (H1 2016: £4.9m).

·      Gross margin of 31.7% (H1 2016: 36.2%) reflecting specific contract issues, now resolved.

·      Further investment of £8.0m in new rigs to continue the growth strategy (H1 2016: £2.1m).

·      Strong balance sheet with net debt at 31 October 2017 of £4.6m (H1 2016: £4.1m).

·      Interim dividend of 1.4 pence per share, reflecting the Board's confidence in the Group's prospects.

 

Jon Fenton, Chief Executive, commented:

 

"This good performance is a direct consequence of our growth strategy.

"As anticipated, we entered the second half in a strong position with activity levels remaining high and trading during November, December and the start of January satisfactory across the Group as a whole.

"Unfortunately, the recent collapse of Carillion will have an impact on the business.  Van Elle carried out regular work for Carillion as a specialist lead sub-contractor, principally in respect of rail improvement and maintenance work and, as previously confirmed, our outstanding debt and work-in-progress exposure with Carillion is approximately £1.6m. We also identified approximately £2.5m of anticipated revenue for the second half of the current year which related to work with Carillion.

"Whilst the Group is continuing to engage with the Official Receiver in respect of this outstanding balance, it is now expected that we may recognise an exceptional bad debt charge of approximately £1.6m in its full year results. All of this debt arose after 31 October 2017. We have also had constructive dialogue with both the Official Receiver and Network Rail in respect of the £2.5m of anticipated revenue and whilst it is possible that some of the anticipated contracts may be delivered in the current year, the status and timing of specific programmes remains uncertain. Van Elle would typically expect to achieve good margins on rail-related work and therefore these anticipated contracts are material in the context of the Group's financial results.  The Board believes it is prudent at this stage to recognise that the disruption to the expected order book due to the situation at Carillion will impact the Group's ability to achieve its previous expectations for the year as a whole.

"Meanwhile, enquiry levels across the Group in general remain encouraging and beyond the specific risks associated with the Carillion situation, the current order book as at January 2018 remains substantial. However, the Group's second half expectation included a small number of important contracts which we had originally expected to commence in the fourth quarter but now believe will slip into the first quarter of next financial year.

"Van Elle continues to deliver strategic progress and, with the support of a strong balance sheet, the long term opportunities for further profitable growth for the Group are significant.  Taking all these factors into account, the Board remains confident about the Group's prospects and, reflecting this confidence, has declared an interim dividend of 1.4p per share."

 

 

 

For further information please contact:

 

Instinctif Partners (Financial Public Relations)

Tel: 020 7457 2020

Mark Garraway

James Gray

Rosie Driscoll

 

 

 

Peel Hunt LLP (Nominated Adviser and corporate broker)

Tel: 020 7418 8900

Charles Batten

Mike Bell

Justin Jones

 

 

Van Elle Holdings plc - Interim Report to 31 October 2017

 

Strategic overview

Since being admitted to trading on AIM on 26 October 2016, Van Elle has actively pursued its growth strategy and the Board is pleased to report further positive results in the first half of this financial year. For the six months ended 31 October 2017, revenues increased by 22.1% over the comparative period to £52.6m (H1 2017: £43.1m), underlying EBITDA increased by 18.7% to £8.4m (H1 2017: £7.1m) and underlying operating profit increased by 15.6% to £5.7m (H1 2017: £4.9m).  Underlying profit before tax was £5.4m, an increase of 15.4% on the same period last year (H1 2017: £4.7m).

Our strategy continues to focus on growing the business by broadening our range of products, techniques and services and extending our geographical footprint into high growth markets across the UK. This will be achieved both organically and also selectively through bolt-on acquisitions.

Capital investment continues to be a key driver of growth with a further £8.0m spent in the first half of the year (H1 2017: £2.1m), bringing the total investment over the last three and a half years to over £40.0m. Nine rigs were purchased in the period and our fleet now stands at 118 rigs and we continue to believe that Van Elle has the broadest and most modern range of specialist piling rigs in the UK market.

Our new state-of-the-art, purpose-built training facility was opened in November and has undertaken several training programmes both internally for staff and externally for clients.  We believe that this facility allows us to deliver an unequalled standard of training to all industry professionals and companies, and is a key driver to staff retention and succession planning.

Investment in our operational facility in Scotland, to serve the local market, has delivered significant growth in the period. This has established Van Elle as the dominant ground engineering company in the central belt of Scotland and demonstrates our ability to penetrate new markets with our leading service offering.

In the new year we opened an office in London as a base for a newly appointed business development manager to cover London and the South of England.

We continue to pursue acquisition opportunities and discussions have been held with several interested parties. We have discounted certain targets due to unrealistic price expectations and lack of strategic fit, however, there remains a pipeline of good opportunities. Our strong financial position will enable us to act swiftly where we feel an opportunity will bring value to the Group.

Cash performance in the half has been good, with strong operating cash flows of £7.1m (H1 2017: £2.6m) representing an operating cash conversion* of 86.9% (H1 2017: 46.9%).  The Group has continued to invest, acquiring nine new rigs which will enhance its service offering.  As a result of the strong cash performance and the Group's strategic investment programme, net assets have increased by 22.8% to £39.2m (31 October 2016: £31.9m). 

*  defined as cash generated from operations divided by EBITDA less profit on sale of fixed assets

 

Trading review

I am pleased to report that the Company grew revenues by 22.1% in the first half of the year to £52.6m (H1 2017: £43.1m) at a time when UK construction output grew by 7.3% for the same period, continuing our track record of outperforming the market and growing our market share.

In terms of our performance in our end markets, sales to the Housebuilding sector were up 22.7% to £26.3m (H1 2017: £21.4m), Infrastructure sector sales were up 37.3% to £15.8m (H1 2017: £11.5m) and sales to the Commercial & Industrial sector were flat at £8.2m (H1 2017: £8.2m).  The ability to redirect resources to reflect short-term trends in our markets remains a key strength of the business, mitigating the impact of a slowdown in any one sector.

A key driver of our revenue growth has been our recent investments in larger and more specialist rigs with significant sales increases in our core techniques: CFA piling (+£1.2m); rotary bored piling (+£3.4m); rotary drilling (+£1.4m); and on-track rail piling (+£3.1m). In addition, our modular beam foundation system, Smartfoot®, continues to gain traction with housebuilders across the UK with sales up over 20% in the first half.

Our sales growth was achieved, most notably, on larger contracts (defined as over £500k), which collectively made up c.29% of total sales by value in the period (H1 2017:15% by value), increasing the average contract value to £112k (H1 2017: £92k). 

Gross margin has reduced to 31.7% in the period (H1 2017:36.2%) reflecting, as previously announced, the changed commercial parameters on two specific rail tenders and the impact of remedial works carried out on a contract in the Ground Stabilisation operating unit. These contract issues were identified and resolved in the period and the gross margin is forecast to return to [improve] in the second half. Excluding the three specific contracts, the gross margin in the first half would have been approximately 33.5%.  Notwithstanding these isolated contract issues impacting on gross margin in the period, we have continued to benefit from operational gearing, which has allowed us to maintain underlying EBITDA margins at 16.0% which, is close to the corresponding period last year (H1 2017: 16.4%).

In light of the Carillion announcement the Group made on 16th January 2018, it should be noted that all work in progress and debt due from Carillion at the end of the interim period had been paid.

Operating performance

General Piling

The General Piling segment has performed strongly in the period with revenues up 7.8% to £22.9m (H1 2017: £21.2m), with growth primarily from the infrastructure (roads) sector. The segment continues to benefit from our large range of rigs and techniques and operating margins have increased to 15.3% (H1 2017:12.5%), as a result of higher utilisation through production efficiencies from delivering higher valued contracts.

Specialist Piling

Revenue growth was once again strong in Specialist Piling, up 23.5% to £14.1m (H1 2017: £11.5m) with all growth generated from infrastructure work, enabled by our strategic investment in specialist rigs and equipment in previous periods to service this sector. Restricted Access revenues grew 4.2% with the operating unit marginally improving both gross and operating margins.  Operating conditions in the Group's rail business continue to be challenging, as previously reported.  Whilst rail revenue growth has been pleasing, the commercial parameters in two specific electrification contracts resulted in a dilution to gross margin in the first quarter. As a result, overall divisional operating margins reduced to 7.7% in the period (H1 2017:12.5%). However, performance in the second quarter was much better, with margins on an improving trend as the Group exited the first half. It has been expected that the divisional operating margin would recover to c.13% in the second half although the results for the remainder of the year will reflect the impact of the collapse of Carillion which has yet to be fully determined.

Ground Engineering Services

Ground Engineering Services has significantly increased revenue, up 79.7% to £8.7m (H1 2017: £4.9m).  This has been driven by strong growth from the burgeoning Scottish operation, which has enabled the Group to increase its activity in this region significantly.  Operating margins are, however, below the prior year at 4.5% (H1 2017:6.8%) reflecting an isolated contract issue in our Ground Stabilisation operating unit which has now been resolved. Adjusting for this contract, the margin would have been approximately 8%. Since the period end, the severe weather during December and January has resulted in some contract delays in the Scottish business, which the Group will work to try and deliver as ground conditions improve.

 

Ground Engineering Products

Revenue growth was also healthy in Ground Engineering Products, up 22.9% to £6.9m (H1 2017: £5.6m). The Group's proprietary Smartfoot® foundation system continues to gain share in the market and the operating performance reflects the benefits of the expanded manufacturing capacity.  Operating margins increased to 9.8% in the period (H1 2017: 8.8%) reflecting the benefits of operational gearing and volume driven production efficiencies. 

Board news

On 1 November 2017 David Stuart Hurcomb was appointed as an Independent Non-Executive Director to the Board.

Also, as announced on 22 November 2017, Jon Fenton, Chief Executive Officer, will be stepping down, once a suitable replacement is identified. The Board is conducting a comprehensive and objective search process for Jon's replacement to identify a new CEO that will bring the relevant commercial, operational and strategic experience to the Group.  A selection process commenced in December 2017 and a high quality initial shortlist of candidates has been identified. The Board will look to progress the process as quickly as possible and looks forward to updating the market with news of Jon's successor in due course.

In December 2017, Van Elle's shareholders comprehensively rejected resolutions to change the Board proposed by the former Chairman, Michael Ellis. The Board believed firmly that contesting these proposals vigorously was in the best interests of all stakeholders and would allow the Group to focus on running the business and delivering our long-term strategy. As a result of contesting the resolutions the Group will recognise an exceptional charge in the second half of approximately £150,000 arising from costs directly associated with the general meeting.

Dividend

In line with its progressive dividend policy and reflecting the good first half performance, as well as its confidence in the long-term prospects of the Group, the Board is declaring an interim dividend of 1.4 pence per share.  The interim dividend will be paid on 7 March 2018 to shareholders on the register on 9 February 2018.  The shares will trade ex-dividend on 8 February 2018.

Current trading and outlook

As anticipated, Van Elle entered the second half in a strong position with activity levels remaining high and trading during November, December and the start of January satisfactory across the Group as a whole.

The recent collapse of Carillion and the impact on the UK construction sector that this may have has been hugely disappointing. As set out in the announcement of 16 January 2018, Van Elle carries out regular work for Carillion as a specialist lead sub-contractor, principally in respect of rail improvement and maintenance work, and our outstanding debt and work-in-progress exposure with Carillion was approximately £1.6m. Whilst the Group is continuing to engage with the Official Receiver in respect of this outstanding balance, it is now expected that Van Elle may recognise an exceptional bad debt charge of approximately £1.6m in its full year results.

In the announcement of 16 January 2018, Van Elle also identified approximately £2.5m of anticipated revenue for the second half of the current year which related to work with Carillion. Management have had constructive dialogue with both the Official Receiver and Network Rail and whilst it is possible that some of the anticipated contracts may be delivered in the current year, the status and timing of specific programmes remains uncertain. Van Elle would typically expect to achieve good margins on rail-related work and therefore these anticipated contracts are material in the context of the Group's financial results.

Enquiry levels across the Group in general remain encouraging and beyond the specific risks associated with the Carillion situation, the current order book as at January 2018 remains substantial.  However, the Group's second half expectation included a small number of important contracts which the Board had originally expected to commence in the fourth quarter but now believe will slip into the first quarter of next financial year.

Van Elle continues to deliver strategic progress and, with the support of a strong balance sheet, the long term opportunities for further profitable growth for the Group are significant. In respect of the current year, the Board continues to monitor market conditions closely, particularly with regard to evolving situation in respect of Carillion. In doing so, it should be recognised that the disruption to the expected order book due to the situation at Carillion will impact the Group's ability to achieve its previous expectations for the year as a whole.

 

Consolidated statement of comprehensive income

For the 6 months ended 31 October 2017

 

Note

6 months to     31 Oct 2017 (unaudited)

6 months to 31 Oct 2016 (unaudited)

12 months to 30 Apr 2017

(audited)

 

 

£'000

£'000

£'000

 

 

 

 

 

Revenue

2

52,642

43,126

94,093

Cost of sales

 

(35,965)

(27,512)

(60,712)

Gross profit

 

16,677

15,614

33,381

Administrative expenses

 

(11,013)

(10,917)

(22,018)

Other operating income

 

-

200

200

Operating profit before exceptional costs and share-based payment expense

 

5,664

4,897

11,563

Share-based payment expense

 

(80)

-

(77)

Exceptional costs

3

-

(1,452)

(1,781)

Operating profit

 

5,584

3,445

9,705

Finance expense

 

(268)

(219)

(436)

Finance income

 

9

5

14

Profit before tax

 

5,325

3,231

9,283

Income tax expense

 

(1,081)

(995)

(1,930)

Total comprehensive income for the year

 

4,244

2,236

7,353

 

 

 

 

 

Earnings per share (pence)

 

 

 

 

Basic

4

5.3

3.2

9.8

Diluted

4

5.3

3.2

9.8

 

 

 

 

 

Underlying earnings per share (pence)

 

 

 

 

Basic

4

5.4

5.2

12.1

Diluted

4

5.4

5.2

12.1

 

All amounts relate to continuing operations. There was no other comprehensive income in either the current or preceding period.

 

 

Consolidated statement of financial position                                 

As at 31 October 2017

 

 

31 Oct 2017 (unaudited)

31 Oct 2016 (unaudited)

30 Apr 2017 (audited)

 

 

£'000

£'000

£'000

 

 

 

 

 

Non-current assets

 

 

 

 

Property, plant and equipment

 

37,369

28,830

32,110

Intangible assets

 

2,318

2,291

2,330

 

 

39,687

31,121

34,440

 

 

 

 

 

Current assets

 

 

 

 

Inventories

 

2,450

1,704

2,423

Trade and other receivables

 

21,049

20,353

18,796

Cash and cash equivalents

 

12,042

8,806

12,858

 

 

35,541

30,863

34,077

Total assets

 

75,228

61,984

68,517

 

 

 

 

 

Current liabilities

 

 

 

 

Trade and other payables

 

17,248

15,084

15,882

Loans and borrowings

 

5,422

3,621

4,461

Corporation tax payable

 

1,067

1,111

878

 

 

23,737

19,816

21,221

 

 

 

 

 

Non-current liabilities

 

 

 

 

Loans and borrowings

 

11,206

9,245

9,855

Provisions

 

342

327

342

Deferred tax

 

778

712

778

 

 

12,326

10,284

10,975

Total liabilities

 

36,063

30,100

32,196

Net assets

 

39,165

31,884

36,321

 

 

 

 

 

Equity

 

 

 

 

Share capital

 

1,600

1,600

1,600

Share premium

 

8,633

8,633

8,633

Retained earnings

 

28,914

21,633

26,070

Non-controlling interest

 

18

18

18

Total equity

 

39,165

31,884

36,321

 

 

 

 

 

 

 

 

 

Consolidated statement of cash flows

For the 6 months ended 31 October 2017

 

Note

6 months to 31 Oct 2017 (unaudited)

6 months to 31 Oct 2016 (unaudited)

12 months to 30 Apr 2017 (audited)

 

 

£'000

£'000

£'000

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

Cash generated from operations

5

7,111

2,621

13,129

Interest received

 

9

5

14

Interest paid

 

(268)

(219)

(436)

Income tax paid

 

(892)

(1,108)

(2,281)

Net cash generated from operating activities

 

5,960

1,299

10,426

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

Purchases of property, plant and equipment

 

(2,967)

(3,349)

(5,562)

Disposal of property, plant and equipment

 

230

-

138

Purchases of intangibles

 

-

-

(71)

Net cash absorbed in investing activities

 

(2,737)

(3,349)

(5,495)

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

Repayment of bank borrowings

 

(75)

(75)

(150)

Proceeds from Invest to Grow loan

 

-

260

260

Repayments of Invest to Grow loan

 

(48)

(8)

(55)

Issue of shares (net of issue costs)

 

-

8,833

8,833

Payments to finance lease creditors

 

(2,516)

(1,755)

(3,882)

Dividends paid

 

(1,400)

-

(680)

Net cash (absorbed)/generated in financing activities

 

(4,039)

7,255

4,326

 

 

 

 

 

Net increase in cash and cash equivalents

 

(816)

5,205

9,257

 

 

 

 

 

Cash and cash equivalents at beginning of period

 

12,858

3,601

3,601

Cash and cash equivalents at end of period

6

12,042

8,806

12,858

 

 

 

 

 

 

 

Consolidated statement of changes in equity

For the 6 months ended 31 October 2017

 

 

Share capital

 

Share premium

Non-controlling interest

 

Retained earnings

 

Total equity

 

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

Balance at 1 May 2016

1,006

-

18

19,728

20,752

 

 

 

 

 

 

Total comprehensive income

-

-

-

2,236

2,236

Share re-designation

63

-

-

-

63

Issue of bonus shares

331

-

-

(331)

-

Issue of ordinary shares on IPO

200

9,800

-

-

10,000

Share issue costs

-

(1,167)

-

-

(1,167)

 

594

8,633

-

1,905

11,132

Balance at 31 October 2016

1,600

8,633

18

21,633

31,884

 

 

 

 

 

 

Total comprehensive income

-

-

-

5,117

5,117

Dividend payment

-

-

-

(680)

(680)

 

-

-

-

4,437

4,437

Balance at 30 April 2017

1,600

8,633

18

26,070

36,321

 

 

 

 

 

 

Total comprehensive income

-

-

-

4,244

4,244

Dividend payment

-

-

-

(1,400)

(1,400)

 

-

-

-

2,844

2,844

Balance at 31 October 2017

1,600

8,633

18

28,914

39,165

 

 

 

 

Notes to the interim results

For the 6 months ended 31 October 2017

1.    Basis of preparation

 

The unaudited interim consolidated statement of Van Elle Holdings plc is for the six months ended 31 October 2017 and do not comprise statutory accounts within the meaning of section 435 of the Companies Act 2006.  These consolidated financial statements have been prepared in compliance with the recognition and measurement requirement of International Financial Reporting Standards, International Accounting Standards and Interpretations (collectively IFRSs) as adopted by the EU.  They do not include all disclosures that would otherwise be required in a complete set of financial statements and should be read in conjunction with the group's annual report.  These consolidated financial statements have been prepared in accordance with the accounting policies that are expected to be applied in the report and accounts for the year ending 30 April 2018.

IFRS 15, 'Revenue from contracts with customers' has been adopted by the EU with an effective date of 1 January 2018.  The Group is continuing to assess the impact of the standard but based on the progress to date, does not expect the standard to have a significant impact on the Group's results.  It is likely that the Group will adopt a prospective transition approach to the standard and further details are contained in the report and accounts for the year ending 30 April 2017.

The Group is also considering the impact on the consolidated financial statements of adopting other standards, amendments or interpretations in issue but not yet effective, including IFRS 9, 'Financial instruments' and IFRS 16, 'Leases'.  The Group's approach to both of these standards are contained in the report and accounts for the year ending 30 April 2017.

The consolidated financial statements are presented in Sterling, which is also the Group's functional currency.  Amounts are rounded to the nearest thousand, unless otherwise stated.

The comparative figures for the year ended 30 April 2017 do not constitute statutory accounts within the meaning of section 435 of the Companies Act 2006, but they have been derived from the audited financial statements for that year, which have been filed with the Registrar of Companies.  The report of the auditors was unqualified and did not contain statements under section 498 (2) or (3) of the Companies Act 2006 nor a reference to any matters which the auditor drew attention by way of emphasis of matter without qualifying their report.

The Accounting policies adopted are consistent with those described in the annual financial statements for the year ended 30 April 2017 and that will be adopted for the year ended 30 April 2018. There have been no significant changes in the basis upon which estimates have been determined, compared to those applied at 30 April 2017 and no change in estimate has had a material effect on the current period.

2.    Segment information

The Group evaluates segmental performance based on profit or loss from operations calculated in accordance with IFRS but excluding non-recurring losses, such as goodwill impairment, and the effects of share-based payments. Traditionally the second half of the year is stronger in turnover and operating performance than the first half of the year with work undertaken by the Specialist Piling division during the statutory holiday periods of Christmas and Easter. However, the impact of Carillion and other matters will make this year an exception to this usual seasonality. Inter-segment sales are priced along the same lines as sales to external customers, with an appropriate discount being applied to encourage use of group resources at a rate acceptable to local tax authorities.  Loans and borrowings, insurances and head office central services' costs are allocated to the segments based on levels of turnover. All turnover and operations are based in the UK.

Operating segments - 6 months to 31 October 2017

 

 

 

General Piling

 

Specialist Piling

Ground Engineering Services

Ground Engineering Products

 

Head Office

 

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

Revenue

 

 

 

 

 

 

Total revenue

24,426

14,237

9,313

8,417

-

56,393

Inter-segment revenue

(1,562)

(93)

(568)

(1,528)

-

(3,751)

Revenue

22,864

14,144

8,745

6,889

-

52,642

 

 

 

 

 

 

 

Operating profit

 

 

 

 

 

 

Underlying operating profit

3,495

1,096

396

677

-

5,664

Share-based payments

-

-

-

-

(80)

(80)

Exceptional item

-

-

-

-

-

-

Operating profit

3,495

1,096

396

677

(80)

5,584

 

 

 

 

 

 

 

Finance expense

-

-

-

-

(268)

(268)

Finance income

-

-

-

-

9

9

Profit before tax

3,495

1,096

396

677

(339)

5,325

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

Property, plant & equipment

13,383

10,499

3,953

1,299

8,235

37,369

Inventories

347

403

222

1,478

-

2,450

Reportable segment assets

13,730

10,902

4,175

2,777

8,235

39,819

Intangible assets

-

-

-

-

2,318

2,318

Trade and other receivables

-

-

-

-

21,049

21,049

Cash and cash equivalents

-

-

-

-

12,042

12,042

Total assets

13,730

10,902

4,175

2,777

43,644

75,228

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

Loans and borrowings

-

-

-

-

16,628

16,628

Trade and other payables

-

-

-

-

18,315

18,315

Provisions

-

-

-

-

342

342

Deferred tax

-

-

-

-

778

778

Total liabilities

-

-

-

-

36,063

36,063

 

 

 

 

 

 

 

Other information

 

 

 

 

 

 

Capital expenditure

3,854

1,807

1,425

104

198

7,388

Depreciation / amortisation

1,087

1,088

384

181

-

2,740

There are no individual customers accounting for more than 10% of Group revenue in either the current or preceding period.

Operating segments - 6 months to 31 October 2016

 

 

 

General Piling

 

Specialist Piling

Ground Engineering Services

Ground Engineering Products

 

Head Office

 

 

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

Revenue

 

 

 

 

 

 

Total revenue

22,349

11,451

4,866

6,922

-

45,588

Inter-segment revenue

(1,144)

-

-

(1,318)

-

(2,462)

Revenue

21,205

11,451

4,866

5,604

-

43,126

 

 

 

 

 

 

 

Operating profit

 

 

 

 

 

 

Underlying operating profit

2,643

1,426

330

498

-

4,897

Share-based payments

-

-

-

-

-

-

Exceptional item

-

-

-

-

(1,452)

(1,452)

Operating profit

2,643

1,426

330

498

(1,452)

3,445

 

 

 

 

 

 

 

Finance expense

-

-

-

-

(219)

(219)

Finance income

-

-

-

-

5

5

Profit before tax

2,643

1,426

330

498

(1,666)

3,231

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

Property, plant & equipment

8,559

9,584

2,119

1,263

7,305

28,830

Inventories

284

198

57

1,165

-

1,704

Reportable segment assets

8,843

9,782

2,176

2,428

7,305

30,534

Intangible assets

-

-

-

-

2,291

2,291

Trade and other receivables

-

-

-

-

20,353

20,353

Cash and cash equivalents

-

-

-

-

8,806

8,806

Total assets

8,843

9,782

2,176

2,428

38,755

61,984

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

Loans and borrowings

-

-

-

-

12,866

12,866

Trade and other payables

-

-

-

-

16,195

16,195

Provisions

-

-

-

-

327

327

Deferred tax

-

-

-

-

712

712

Total liabilities

-

-

-

-

30,100

30,100

 

 

 

 

 

 

 

Other information

 

 

 

 

 

 

Capital expenditure

1,442

2,005

925

409

1,117

5,898

Depreciation / amortisation

891

853

270

127

-

2,141

 

 

Operating segments - 12 months to 30 April 2017

 

 

 

General Piling

 

Specialist Piling

Ground Engineering Services

Ground Engineering Products

 

Head Office

 

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

Revenue

 

 

 

 

 

 

Total revenue

45,008

30,126

10,621

13,714

-

99,469

Inter-segment revenue

(2,103)

-

-

(3,273)

-

(5,376)

Revenue

42,905

30,126

10,621

10,441

-

94,093

 

 

 

 

 

 

 

Operating profit

 

 

 

 

 

 

Underlying operating profit

4,685

5,355

772

751

-

11,563

Share-based payments

-

-

-

-

(77)

(77)

Exceptional item

-

-

-

-

(1,781)

(1,781)

Operating profit

4,685

5,355

772

751

(1,858)

9,705

 

 

 

 

 

 

 

Finance expense

-

-

-

-

(436)

(436)

Finance income

-

-

-

-

14

14

Profit before tax

4,685

5,355

772

751

(2,280)

9,283

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

Property, plant & equipment

10,456

9,696

2,778

1,373

7,807

32,110

Inventories

414

370

179

1,460

-

2,423

Reportable segment assets

10,870

10,066

2,957

2,833

7,807

34,533

Intangible assets

-

-

-

-

2,330

2,330

Trade and other receivables

-

-

-

-

18,796

18,796

Cash and cash equivalents

-

-

-

-

12,858

12,858

Total assets

10,870

10,066

2,957

2,833

41,791

68,517

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

Loans and borrowings

-

-

-

-

14,316

14,316

Trade and other payables

-

-

-

-

16,760

16,760

Provisions

-

-

-

-

342

342

Deferred tax

-

-

-

-

778

778

Total liabilities

-

-

-

-

32,196

32,196

 

 

 

 

 

 

 

Other information

 

 

 

 

 

 

Capital expenditure

4,267

2,948

1,841

668

2,041

11,765

Depreciation / amortisation

1,918

1,848

622

299

-

4,687

There are no individual customers accounting for more than 10% of Group revenue in either the current or preceding year.

 

 

3.     Exceptional costs                                                                                           

 

6 months to 31 Oct 2017 (unaudited)

6 months to 31 Oct 2016 (unaudited)

12 months to 30 Apr 2017 (audited)

 

£'000

£'000

£'000

 

 

 

 

Initial Public Offering ("IPO")

-

1,452

1,452

Other exceptional costs

-

-

329

 

-

1,452

1,781

 

                                                                              Initial Public Offering ("IPO")

The charge in the prior period represents fees and other costs arising because of the IPO which have not been treated as deductions against the share premium account. Of the exceptional charge of £1,452,000, approximately £104,000 is treated as tax deductible and the balance of £1,348,000 is treated as disallowed tax expenses in the tax computation.

Other exceptional items

The other exceptional item relates to severance costs arising from the Board changes following the IPO and other legal matters arising as a consequence of the IPO. These are treated as fully tax deductible within the tax computation.

 

4.       Earnings per share

          The calculation of basic and diluted earnings per share is based on the following data:          

      

6 months to 31 Oct 2017 (unaudited)

6 months to 31 Oct 2016 (unaudited)

12 months to 30 Apr 2017 (audited)

 

'000

'000

'000

Basic weighted average number of shares

80,000

70,373

75,123

 

Dilutive potential ordinary shares from share options

-

-

-

 

Diluted weighted average number of shares

80,000

70,373

75,123

 

 

 

 

 

 

 

£'000

£'000

£'000

 

Profit for the year

4,244

2,236

7,353

 

Add back / (deduct):

 

 

 

 

Share-based payments

80

-

77

 

Exceptional costs

-

1,452

1,781

 

Tax effect of the above

-

(21)

(86)

 

Underlying profit for the year

4,324

3,667

9,125

 

 

 

 

 

 

 

Pence

Pence

Pence

 

Earnings per share

 

 

 

 

Basic

5.3

3.2

9.8

 

Diluted

5.3

3.2

9.8

 

Basic - excluding exceptional costs and share-based payments

5.4

5.2

12.1

 

Diluted - excluding exceptional costs and share-based payments

5.4

 

5.2

12.1

 

         The calculation of the basic earnings per share is based on the earnings attributable to ordinary shareholders and on 80,000,000 ordinary shares (6 months ended 31 Oct 2016: 70,372,665 and 12 months ended 30 Apr 2017: 75,123,288) being the weighted average number of ordinary shares. In accordance with IAS 33 the weighted average number of shares in issue during the prior period has been retrospectively adjusted for the proportionate change in the number of the shares outstanding because of the bonus issue and share splits that occurred on admission to AIM.

         The underlying earnings per share is based on profit adjusted for exceptional operating costs and share-based payment charges, net of tax, and on the same weighted average number of shares used in the basic earnings per share calculation above.  The Directors consider that this measure provides an additional indicator of the underlying performance of the Group.

         There is no dilutive effect of the share options as performance conditions remain unsatisfied and the share price was below the exercise price.

         

     

 

 

5.     Cash generated from operations                                                                                  

      

6 months to 31 Oct 2017 (unaudited)

6 months to 31 Oct 2016 (unaudited)

12 months to 30 Apr 2017 (audited)

 

£'000

£'000

£'000

Operating profit

5,584

3,445

9,705

Adjustments for:

 

 

 

Depreciation of property, plant and equipment

2,740

2,141

4,687

Profit on disposal of property, plant and equipment

(221)

-

(89)

Share-based payment expense

80

-

77

Operating cash flows before movement in working capital

8,183

5,586

14,380

Increase in inventories

(27)

(93)

(812)

Increase in trade and other receivables

(2,332)

(3,657)

(1,950)

Increase in trade and other payables

1,287

833

1,544

Decrease in provisions

-

(48)

(33)

Cash generated from operations

7,111

2,621

13,129

 

6.     Analysis of cash and cash equivalents and reconciliation to net debt                          

      

31 Oct 2017 (unaudited)

31 Oct 2016 (unaudited)

30 Apr 2017 (audited)

 

£'000

£'000

£'000

Cash at bank

11,992

8,752

12,810

Cash in hand

50

54

48

Cash and cash equivalents

12,042

8,806

12,858

Bank loans secured

(1,200)

(1,350)

(1,275)

Other loans secured

(157)

(252)

(205)

Finance leases

(15,271)

(11,264)

(12,836)

Net debt

(4,586)

(4,060)

(1,458)

 

 


This information is provided by RNS
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