Provend Group PLC - Final Results
01 Octobre 1997 - 9:31AM
UK Regulatory
RNS No 5825p
PROVEND GROUP PLC
1st October 1997
PROVEND GROUP PLC
ANNOUNCEMENT OF PRELIMINARY RESULTS
FOR THE YEAR
ENDED 29 JUNE 1997
Provend Group PLC ('Provend'), one of the UK's largest
independent vending companies and also one of the largest
supplier of ingredients and catering supplies to the vending
market, announces its Preliminary Results for the year ended
29th June 1997. These are the first annual results following
admittance to the main London Stock Exchange on the 21 November
1996. The group employs over 900 staff and operates
nationwide.
- Turnover up 14.1% at #52.3m
- Operating profit up 32.6% at #2.6m
- Pre-tax profit increased 37.4% to #1.67m
- Net cash inflow from operating activities (after capital
expenditure) up 27.0% at #2.5m
- Good progress with acquisitions. Four being completed in
year.
- Strategic Vending Services Limited - November 1996
- Norvale Perry Limited - March 1997
- Beverage business of Single Service Limited - April 1997
- Southern vending business of City Vending Limited - May
1997
- Successful launch in April 1997 of Food Courts, a new
initiative - automated restaurants for employees at work
- Maiden dividend of 3p per share to be paid, in line with
Prospectus
Chairman, Michael Borlenghi commented:
"Provend is now well positioned in its market to maintain its
growth record by continued innovation in its service offerings
and to take advantage of any opportunities for further
development to the benefit of shareholder value."
For further information contact:
Rufus Bond Gunning, Managing Director, Provend Group PLC
Tel.No. 0171 466 5000 (today)
Richard Williams, Finance Director, Provend Group PLC
Tel.No. 0181 998 2828 (thereafter)
Michael Padley / Isabel Petre, Buchanan Communications Limited
Tel.No. 0171 466 5000
CHAIRMANS STATEMENT
I am delighted to be able to report that Provend has achieved
an operating profit of #2.6 million. an increase over last
year of 32.6%.
In November 1996, the group obtained a full listing on the
London Stock Exchange and I would like to take this opportunity
to welcome all new investors. Also I would like to welcome
Jeremy Lancaster who joined us as a non executive director
shortly after our admission to the Stock Exchange. Jeremy is
non executive Chairman of Rexam PLC and Hepworth PLC and has a
particular experience of developing wholesale and distribution
businesses.
Between the listing and the year end the group acquired four
additional businesses, two within the vending division and two
within the wholesale supplies division. All the acquisitions
are progressing to plan.
The directors are recommending a final dividend of 3p per share
for the period ended 29 June 1997 which will be paid on 16
December 1997 to all shareholders on the register at 17
November 1997. We intend to follow a progressive dividend
policy.
For the last six years, since formation, the group has
progressively improved its results and we remain committed to
growing profitable sales in our two core divisions, vending and
wholesale supplies, by continuing to achieve steady organic
growth supplemented by strategic acquisitions in the UK. The
management is committed to improving existing service levels to
our clients by making continuous improvements in the quality,
performance and delivery of our products and service through
continuing our investment in training, accelerating investment
in IT, innovation and development of our people, products and
services.
I would like to take this opportunity to thank all our staff
for their contributions towards such a successful year. Their
dedicated support has enabled us to maintain a very high level
of customer service and is a key element in the development of
our business.
Provend is now well positioned in its market to maintain its
growth record by continued innovation in its service offerings
and to take advantage of any opportunities for further
development to the benefit of shareholder value.
MICHAEL BORLENGHI
CHAIRMAN
1 October 1997
MANAGING DIRECTORS REVIEW
Provend Group PLC, through its vending division, is the leading
national provider of vending services in the UK, supplying and
managing systems and equipment for automated staff restaurants,
machines supplying meals, snacks, canned and bottled drinks,
hot and cold beverages, water and non consumable items.
Through its supplies division, the group is one of the largest
national vending suppliers of ingredients, cups, catering and
hygiene supplies to commercial and workplace sites and to hotel
and outdoor catering sectors.
The group operates out of 12 strategically located sites
covering Scotland, England and Wales and serves a blue chip
customer base with a machine population in excess of 18,000
supported by over 900 employees.
The group substantially improved operating profits from #1.98
million to #2.62 million, an increase of 32.6%.
The vending division
This division, which encompasses the acquisitions of Strategic
Vending Services and the southern vending business of City
Vending, had a satisfactory year. In particular the national
accounts team have achieved some notable successes. During the
year excellent progress was made in developing our business
with seven of the top nine food retailers and we successfully
expanded our business with high street retailers, financial
institutions, utilities and national petrol forecourt
companies. Both acquisitions made during the year are
producing better than planned gross margins.
The launch of Food Courts automated employee catering continues
the innovative approach to the market place which has
contributed greatly to the growth of this division over the
last six years.
This year was one which saw a rapid increase in our overall
customer and machine base and the continuation of growth, at an
improved rate, of our operated business. This divisions
market share in its core business increased from 12% to 15%.
During the 1997/98 year investments in systems and support
capability will be accelerated to enable the division to offer
our clients an increasingly comprehensive service.
The new trading year has started with an improved order book
and we have appointed two new general managers who greatly
strengthen the management team.
The wholesale supplies division
This division, which encompasses the acquisitions of Norvale
Perry and the Douwe Egbert distribution contract acquired from
Single Service Limited, had an excellent year with a solid
growth in profits, excluding the contribution from the
acquisitions made since listing.
Strong sales growth was achieved with ambient food and our
specialist in-cup product. Additional sales across our range
of products are developing well in the acquisitions whilst at
the same time gross margins are being improved. The
acquisitions have provided a more balanced portfolio of
products.
The new trading year has started well for the division.
Prospects
We are confident that this year will see the group continuing
to meet its plans for organic growth in sales and profits with
the opportunities of supplementing our plan with strategic
acquisitions to further enhance shareholder value.
We wish to take this opportunity to thank all our employees
whose commitment and loyalty has played a vital part in the
successful development of the group.
RUFUS BOND GUNNING
MANAGING DIRECTOR
Consolidated profit and loss account
for the year ended 29 June 1997
1997 1996
Notes #000 #000
Turnover
Continuing operations 49,837 45,804
Acquisitions 2,420 -
______ ______
Total turnover 2 52,257 45,804
Cost of sales (42,807) (37,439)
Gross profit 9,450 8,365
Distribution costs (1,489) (1,297)
Administrative expenses (5,340) (5,091)
______ ______
Operating profit
Continuing operations 2,228 1,977
Acquisitions 393 -
______ ______
Total operating profit 2 2,621 1,977
Interest payable and
similar charges (275) (763)
Exceptional item -
interest payable 3 (678) -
______ ______
Profit on ordinary activities
before taxation 1,668 1,214
Tax on profit on
ordinary activities 4 (328) (154)
______ ______
Profit on ordinary
activities after taxation 1,340 1,060
Dividends 5 (518) (117)
______ ______
Retained profit for the financial year 822 943
====== ======
Earnings per ordinary share 6 9.6p 11.0p
Earnings per ordinary
share before exceptional interest 14.5p 11.0p
The group has not discontinued any operations within the
meaning of Financial Reporting Standard 3 during the year.
The group has no recognised gains and losses other than those
included in the profits above and, therefore, no separate
statement of total recognised gains and losses has been
presented.
There is no difference between the profit on ordinary
activities before taxation and the retained profit for the year
stated above and their historical cost equivalents.
Balance sheets
as at 29 June 1997
Group
1997 1996
#000 #000
Fixed assets
Tangible assets 1,825 1,423
Investments - -
______ ______
1,825 1,423
______ ______
Current assets
Stocks 4,247 3,134
Debtors: amount falling due after
more than one year 411 439
Debtors: amount falling due
within one year 8,049 6,744
Cash at bank and in hand 1,187 332
______ ______
13,894 10,649
Creditors: amount falling
due within one year (15,528) (11,995)
______ ______
Net current (liabilities)/assets (1,634) (1,346)
______ ______
Total assets less current liabilities 191 77
Creditors: amounts falling due after
more than one year (410) (4,433)
______ ______
Net (liabilities)/assets (219) (4,356)
====== ======
Capital and reserves
Called up share capital 173 180
Share premium account 8,106 270
Goodwill reserve (9,534) (3,786)
Other reserves 1,234 -
Profit and loss account (198) (1,020)
______ ______
Shareholders funds
(1996: including non equity interests)(219) (4,356)
====== ======
The financial statements were approved by the board of
directors on 30 September 1997 and were signed on its behalf
by
RUFUS BOND GUNNING RICHARD WILLIAMS
Consolidated cash flow statement
for the year ended 29 June 1997
1997 1996
#000 #000
Net cash inflow from
operating activities 3,222 2,517
______ ______
Returns on investments and
servicing of finance
Interest paid (294) (744)
Interest paid - exceptional item (678) -
Interest element on finance lease rentals(40) (19)
Interest received 59 -
______ ______
Net cash outflow from returns on investment
and servicing of finance (953) (763)
______ ______
Taxation
Corporation tax paid (256) -
______ ______
Capital expenditure
Purchase of tangible fixed assets (713) (577)
Sale of tangible fixed assets 33 61
______ ______
Net cash outflow from
capital expenditure (680) (516)
______ ______
Acquisitions and disposals
Deferred consideration on
prior year acquisitions (213) -
Purchase of subsidiary undertakings (4,033) (1,926)
Net cash acquired with subsidiaries 129 137
______ ______
Net cash outflow from
acquisitions and disposals (4,117) (1,789)
______ ______
Management of Liquid Resources
Deferred consideration placed
in escrow account (450) -
______ ______
Financing
Issue of ordinary share capital 9,880 -
Issue of loan notes - 950
Bank loan - 950
Repayment of bank loan (1,150) (250)
Repayment on loan notes (3,600) -
Finance lease repayments (82) (42)
Expense of share issue (817) -
______ ______
Net cash inflow from financing 4,231 1,608
______ ______
Increase in cash 997 1,057
====== ======
Notes to the financial statements
1. Basis of accounting
The financial statements have been prepared in accordance with
the historical cost convention. The acquisition by the company
of Provend Services Limited on 18 October 1996 has been
accounted for using merger accounting principles and
accordingly the consolidated financial statements have been
prepared as if Provend Services Limited had been owned by the
company throughout the entire year and prior year.
2. Segmental analysis
Audited Audited
year ended year ended
29 June 1997 30 June 1996
Turnover #000 #000
Vending and ingredient supplies 45,875 41,288
Catering disposables 6,382 4,516
__________ __________
52,257 45,804
__________ __________
Operating profit
Vending and ingredient supplies 1,864 1,522
Catering disposables 757 455
__________ __________
2,621 1,977
_________ __________
3. Exceptional item
Following the flotation of the group on 18 November 1996 the
cumulative arrears of interest on the unsecured loan notes
amounting to #678,000, which had been deferred by the loan note
holders and was not provided for at 30 June 1996, became
payable immediately.
4. Taxation
The taxation charge is based on the estimated effective tax
rate of 19.7% for the full year as a proportion of losses from
the early years of the buyout are utilised. The tax effect of
the exceptional item is nil.
5. Dividends
As set out in the listing particulars, the first dividend to be
declared is the final dividend in respect of the
financial year ending 29th June 1997. The directors are
recommending a final dividend of 3p per share for the period
ended 29th June 1997 which will be paid on 16th December 1997
to all shareholders on the register at 17th November 1997.
6. Earnings per share
Earnings per share is based on profit on ordinary activities
after taxation. Earnings per share for the year ended 29 June
1997 is calculated using the weighted average number of shares
of 13,930,498 in issue during the period. Earnings per share
for the year ended 30 June 1996 are calculated using the
weighted average number of shares of 8,571,360 in issue during
that period.
7. Audited accounts
The results of the group for the year ended 29 June 1997
included in the preliminary statement are a summary of the
groups statutory accounts for that period. Statutory accounts
of the group for the year ended 29 June 1997 have not yet been
delivered to the Registrar of Companies. The groups auditors
have reported on the accounts as required by section 235 of the
Companies Act 1985. The auditors report was unqualified and
did not contain a statement under Section 237(2) or (3) of the
Companies Act 1985.
As explained above the figures and financial information for
the year ended 30 June 1996 relate to Provend Services Limited
and do not constitute the accounts for that year. Those
statutory accounts of Provend Services Limited have been
delivered to the Registrar and included the auditors report
which was unqualified.
Copies of the Annual Report & Accounts will be posted to all
shareholders. Copies are available from the Company Secretary,
Provend Group PLC, 19 Aintree Road, Perivale, Greenford,
Middlesex UB6 7LG
END
FR LMMRBLLAJBMR
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