TIDMIGR
RNS Number : 1977T
International Greetings PLC
11 December 2012
11(th) December 2012
International Greetings PLC ("the Company" or "the Group")
Interim Results
International Greetings PLC, one of the world's leading
designers, innovators and manufacturers of gift packaging and
greetings, stationery and creative play products, announces its
interim results for the six months ended 30 September 2012.
Financial highlights
-- Sales up 4.5% to GBP115.2 million (2011 H1: GBP110.3 million)
-- Operating profit before exceptional items level at GBP5.2
million
-- Profit before tax and exceptional items up 2% to GBP3.3 million
(2011 H1: GBP3.2 million)
-- Profit before tax up 19% at GBP2.5 million (2011 H1: GBP2.1
million) after exceptional costs of GBP0.75 million (2011
H1: GBP1.1 million)
-- Net debt down GBP4 million at GBP84.5 million (2011 H1: GBP88.5
million)
Operational highlights
-- Double digit sales and profits growth in the US
-- Continued sales and profit progression in UK/Asia with operational
streamlining in the UK
-- First season in our new manufacturing facility in China completed
-- Upgraded logistics facilities in Australia including completion
of semi-automated systems
-- Record levels of giftwrap volumes produced supported by new
state of the art manufacturing facilities in Holland
-- Global sales of Everyday single cards on course to grow by
over 25% in the UK and USA in the current year
-- Order book for FY 13/14 well advanced
Paul Fineman, Chief Executive said:
"During the first half of the year we have focused on completing
a number of operational improvements to drive efficiencies
including the installation of our new "state of the art" printing
press in Holland, our upgraded logistics facilities in Australia
and further operational streamlining in the UK. The relocation of
our manufacturing operation in China is also complete and by the
end of 2012 we will have manufactured a record 65 million Christmas
crackers during the year.
"The Group continues to trade profitably in all regions despite
challenging market conditions. We remain focused on delivering
earnings growth and debt reduction across our diverse geographical
portfolio and identifying opportunities for further growth."
For further information, please contact:
International Greetings plc Tel: 01525 887 310
Paul Fineman, Chief Executive
Anthony Lawrinson, Chief Financial
Officer
Cenkos Securities plc Tel: 0207 397 8900
Bobbie Hilliam
Adrian Hargrave
Arden Partners plc Tel: 020 7614 5917
Richard Day
Jamie Cameron
FTI Consulting Tel: 020 7831 3113
Jonathon Brill
Georgina Goodhew
Chief Executive's Review
Overview
Sales and profit for the six months ended 30(th) September 2012
are overall in line with expectations.
Operational Review
The first half of this year has featured a number of key
operational highlights including the first season of production
following the relocation of our manufacturing facilities in China.
Despite initial challenges we completed a substantial amount of the
output in the period, with over 65 million Christmas crackers due
to be manufactured during 2012.
Profits in the UK and Asia have grown during the period with
further operational streamlining within the UK having been
achieved. We are also pleased to report that our success in United
States has continued to gain momentum with excellent sales and
profit growth across all major categories. In this market we
continue to see new consumer trends emerging including the
increasing popularity of Christmas crackers. Growth of Everyday
greeting cards averaged over 25% in these territories.
Record levels of giftwrap volumes continue to be sold, now
supported by new high speed state of the art manufacturing
equipment which was successfully installed in the Netherlands
during the Spring. Whilst the market in continental Europe
continues to be particularly challenging, the recent investment
made in gift wrap production, amongst other factors, helped to
ensure that our operations remained profitable. At Artwrap, our
Joint Venture in Australia, we have upgraded logistics facilities
including semi-automation in order to increase efficiencies.
However, our Joint Venture in Australia is now experiencing some of
the macroeconomic market conditions which the Group has
successfully managed in recent years in the US, UK and European
markets.
Financial Review
Revenue from continuing operations for the period increased by
4.5% to GBP115.2 million (2011: GBP110.3 million), with
particularly good progress in the UK and USA where sales increased
by 4% and 15% respectively. Together these more than compensated
for continuing challenges in the European marketplace and signs of
slowdown at our Joint Venture in Australia.
Inflationary pressures on costs continued with sea freight on
average 24% higher than over the equivalent period last year but
our efforts succeeded in mitigating this. Gross profit margins at
18.4% (compared to 19.1% in 2011 and 18.3% in H1 2010) were 0.7%
lower as a result of the reducing contribution from our higher
margin Australian Joint Venture.
At GBP16.6 million (2011 H1: GBP16.2 million), overheads as a
percentage of sales continued to fall from 14.7% to 14.4%.
Operating profit before exceptional costs was flat at GBP5.2
million (2011 H1: GBP5.2 million) or up 1.3% at constant exchange
rates. Profit before tax and exceptional items was up 2.2% to
GBP3.3 million (2010 H1: GBP3.2 million) or 4% at constant exchange
rates.
Profit before tax and after exceptional items was up 19% to
GBP2.5 million (2011 H1: GBP2.1 million).
Finance expenses in the period were GBP1.9 million (2011 H1:
GBP2.0 million). This overall reduction reflects the full year
effect of higher borrowing margins and one-off charges associated
with the refinancing and extension of the maturity of our
facilities but has been significantly offset by lower debt levels
throughout the period. Shorter dated facilities were renewed in the
period for a further year with improved facility headroom and
flexibility and the first 0.5% of a series of potential margin
reductions was achieved as leverage fell to qualifying levels. Debt
reduction remains a key focus and our programme for this is
on-track.
The effective underlying tax rate was 26% (2011 H1: 27.5%)
reflecting the mix of profits shifting slightly away from the
higher tax jurisdictions and also lower UK rates. There are still
unrecognised losses with a tax value of $6.2 million in the USA and
GBP0.4 million in the UK which can be reflected in the balance
sheet as US profitability progresses.
As recently announced and subsequent to the end of the period, a
major customer of Artwrap, our Joint Venture in Australia, went
into voluntary administration. This has placed the recoverability
of the outstanding debt at risk and AUS$1.2 million has been
provided as an exceptional adjusting item in the H1 accounts. As a
result exceptional costs relating to the period were provided at
GBP0.75 million (2011 H1: GBP1.1 million). However the effect on
earnings will only be impacted by GBP0.3 million reflecting tax and
the minority interest.
Stated before exceptional items, basic earnings per share were
3.9p (2011 H1: 3.4p), and 3.4p (2011 H1: 1.8p) after exceptional
items. Diluted earnings per share before exceptional items were
3.7p (2011 H1: 3.2p), up 15.6% on the prior year. See note 6 of the
interim financial statements.
Capital expenditure in the six months was GBP1.4 million (2011
H1: GBP1.4 million). Some surplus land in Wales and machines in
Australia were sold in the period generating proceeds of GBP0.4
million in cash.
Cash used by operations was GBP39.1 million (2011 H1: GBP39.9
million), which reflects the seasonality of the business as 58% of
the sales in the six month period occurred in the last two
months.
Debtors and receivables at GBP69.3 million have reduced slightly
from GBP69.4 million at H1 2011 and stock levels actually fell by
5.6% from GBP64.2 million (H1 2011) to GBP60.6 million (H1 2012)
despite the sales increase of 4.5%.
Net debt at 30 September 2012 was down GBP4.0 million to GBP84.5
million (2011 H1: GBP88.5 million).
The Board will not be declaring an interim dividend and will
keep this policy under review (2011 H1: nil).
Current Trading Outlook
Our Group continues to trade profitably in all regions with
overall sales growth in the first half of 4.5%. At the same time
our debt reduction programme remains on track and we have reduced
debt by GBP4.0 million during the period. Driving strong earning
per share growth also remains a core objective and this is
underpinned by our encouraging performance in our major
markets.
Our Joint Venture in Australia is now experiencing some of the
macroeconomic market conditions which the Group has successfully
managed in recent years in the US, UK and European markets and this
may slow the pace of growth to headline profitability but the
effect on earnings is much reduced after allowing for tax and the
minority interest.
Our track record over recent years of prudent investment
combined with the provision of innovative and competitive products
has enabled us to combat competitive market dynamics across our
global customer base. This underlines the importance of creating
efficiencies across the Group, leveraging scale and continuing to
balance the geography, product category and seasonality of our
activities.
Paul Fineman
Chief Executive
Consolidated income statement
six months ended 30 September 2012
Unaudited Unaudited
six months six months 12 months
ended 30 ended Ended
September 30 March
September 31
2012 2011 2012 2011 2011 2011 2012 2012 2012
Before Exceptional Before Exceptional Before Exceptional
exceptional items exceptional items exceptional items
items (note 10) Total items (note Total items (note Total
10) [10])
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Continuing
operations
Revenue 115,207 - 115,207 110,227 - 110,277 220,755 - 220,755
Cost of
sales (94,056) - (94,056) (89,194) - (89,194) (178,190) - (178,190)
Gross profit 21,151 - 21,151 21,083 - 21,083 42,565 - 42,565
18.4% 18.4% 19.1% 19.1% 19.3% 19.3%
Selling
expenses (6,723) (750) (7,473) (6,451) - (6,451) (13,003) - (13,003)
Administration
expenses (9,849) - (9,849) (9,734) (1,080) (10,814) (19,580) (3,635) (23,215)
Other operating
income 382 - 382 287 - 287 678 - 678
Profit/(loss)
on sales
of
property,
plant
and equipment 251 - 251 22 - 22 63 (283) (220)
Operating
profit/(loss) 5,212 (750) 4,462 5,207 (1,080) 4,127 10,723 (3,918) 6,805
Finance
expenses (1,929) - (1,929) (1,994) - (1,994) (3,635) - (3,635)
Profit/(loss)
before tax 3,283 (750) 2,533 3,213 (1,080) 2,133 7,088 (3,918) 3,170
Income tax
(charge)/credit (854) 224 (630) (884) 222 (662) (1,948) 195 (1,753)
Profit/(loss)
from
continuing
operations
for the
period 2,429 (526) 1,903 2,329 (858) 1,471 5,140 (3,723) 1,417
Attributable
to:
Owners of
the Parent
Company 1,874 993 177
Non-controlling
interest 29 478 1,240
Consolidated income statement
six months ended 30 September 2012
Unaudited six Unaudited six
months months
ended 30 September ended 30 September 12 months ended
31 March
2012 2011 2012
--------------------- --------------------- ------------------
Earnings per ordinary Diluted Basic Diluted Basic Diluted Basic
share
------------------------------- ----------- -------- ----------- -------- --------- -------
Adjusted earnings per
share excluding
exceptional items 3.7p 3.9p 3.2p 3.4p 6.7p 7.2p
Loss per share on exceptional
items (0.5)p (0.5)p (1.5)p (1.6)p (6.4)p (6.9p)
------------------------------- ----------- -------- ----------- -------- --------- -------
Earnings per share from
continuing operations 3.2p 3.4p 1.7p 1.8p 0.3p 0.3p
Earnings per share 3.2p 3.2p 1.7p 1.8p 0.3p 0.3p
------------------------------- ----------- -------- ----------- -------- --------- -------
Consolidated statement of comprehensive income
six months ended 30 September 2012
Unaudited Unaudited
six months six months
ended 30 ended 30 12 months
September September ended 31 March
2012 2011 2012
GBP000 GBP000 GBP000
------------------------------------ ----------- ----------- ---------------
Profit for the year 1,903 1,471 1,417
Other comprehensive income:
------------------------------------ ----------- ----------- ---------------
Exchange difference on translation
of foreign operations (473) (155) (88)
Net (loss)/profit on cash flow
hedges (net of tax) (181) 274 (322)
------------------------------------ ----------- ----------- ---------------
Other comprehensive income for
period, net of tax (654) 119 (410)
Total comprehensive income for
the period, net of tax 1,249 1,590 1,007
Attributable to:
Owners of the Parent Company 1,260 1,018 (475)
Non-controlling interests (11) 572 1,482
------------------------------------ ----------- ----------- ---------------
1,249 1,590 1,007
------------------------------------ ----------- ----------- ---------------
Consolidated statement of changes in equity
six months ended 30 September 2012
Share
premium
and Non-
capital
Share redemption Merger Hedging Translation Retained Shareholder controlling
capital reserve reserves reserves reserve earnings equity interest Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 31
March
2012 2,750 4,480 17,164 (446) 446 23,410 47,804 4,744 52,548
Profit
for
the year - - - - - 1,874 1,874 29 1,903
Other comprehensive
income - - - (181) (433) - (614) (40) (654)
Total comprehensive
income for the
year - - - (181) (433) 1,874 1,260 (11) 1,249
Equity-settled
share-based
payment - - - - - 55 55 - 55
Options exercised 78 159 - - - - 237 - 237
Equity dividends
paid - - - - - - - (968) (968)
At 30 September
2012 2,828 4,639 17,164 (627) 13 25,339 49,356 3,765 53,121
Consolidated statement of changes in equity
six months ended 30 September 2012
For the six months ended 30 September 2011
Share
premium
and Non-
capital
Share redemption Merger Hedging Translation Retained Shareholder controlling
capital reserve reserves reserves reserve earnings equity interest Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 1 April
2011 2,698 4,386 17,164 (124) 776 23,190 48,090 4,220 52,310
Profit for
the period - - - - - 993 993 478 1,471
Other comprehensive
income - - - 274 (249) - 25 94 119
Total comprehensive
income for
the year - - - 274 (249) 993 1,018 572 1,590
Equity-settled
share-based
payment - - - - - 53 53 - 53
Options exercised 14 25 - - - - 39 - 39
Equity dividends
paid - - - - - - - (958) (958)
At 30 September
2011 2,712 4,411 17,164 150 527 24,236 49,200 3,834 53,034
Consolidated statement of changes in equity
six months ended 30 September 2012
For the year ended 31 March 2012
Share
premium
and Non-
capital
Share redemption Merger Hedging Translation Retained Shareholder controlling
capital reserve reserves reserves reserve earnings equity interest Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 1 April
2011 2,698 4,386 17,164 (124) 776 23,190 48,090 4,220 52,310
Profit for
the year - - - - - 177 177 1,240 1,417
Other comprehensive
income - - - (322) (330) - (652) 242 (410)
Total comprehensive
income for
the year - - - (322) (320) 177 (475) 1,482 1,007
Equity-settled
share-based
payment - - - - - 43 43 - 43
Options exercised 52 94 - - - - 146 - 146
Equity dividends
paid - - - - - - - (958) (958)
At 31 March
2012 2,750 4,480 17,164 (446) 446 23,410 47,804 4,744 52,548
Consolidated balance sheet
as at 30 September 2012
Unaudited Unaudited
as at 30 as at 30 As at
September September 31 March
2012 2011 2012
Note GBP000 GBP000 GBP000
------------------------------- ----- ---------- ---------- ---------
Non-current assets
Property, plant and equipment 30,360 31,130 31,533
Intangible assets 32,502 33,082 32,916
Deferred tax assets 4,159 4,758 4,640
------------------------------- ----- ---------- ---------- ---------
Total non-current assets 67,021 68,970 69,089
------------------------------- ----- ---------- ---------- ---------
Current assets
Inventory 60,615 64,202 42,628
Trade and other receivables 69,289 69,360 20,942
Cash and cash equivalents 4 3,403 1,734 3,168
------------------------------- ----- ---------- ---------- ---------
Total current assets 133,307 135,296 66,738
------------------------------- ----- ---------- ---------- ---------
Total assets 200,328 204,266 135,827
------------------------------- ----- ---------- ---------- ---------
Equity
Share capital 2,828 2,712 2,750
Share premium 3,299 3,071 3,140
Reserves 17,890 19,181 18,504
Retained earnings 25,339 24,236 23,410
------------------------------- ----- ---------- ---------- ---------
Equity attributable to owners
of the
Parent Company 49,356 49,200 47,804
------------------------------- ----- ---------- ---------- ---------
Non-controlling interests 3,765 3,834 4,744
------------------------------- ----- ---------- ---------- ---------
Total equity 53,121 53,034 52,548
------------------------------- ----- ---------- ---------- ---------
Non-current liabilities
Loans and borrowings 4 28,854 34,926 33,622
Deferred income 1,604 2,154 1,879
Provisions 899 1,847 1,003
Other financial liabilities 526 355 447
------------------------------- ----- ---------- ---------- ---------
Total non-current liabilities 31,883 39,282 36,951
------------------------------- ----- ---------- ---------- ---------
Current liabilities
Bank overdraft 5,820 5,940 1,945
Loans and borrowings 4 53,199 49,383 9,329
Deferred income 550 550 550
Provisions 172 - 317
Income tax payable 580 585 855
Trade and other payables 45,191 42,324 23,133
Other financial liabilities 9,812 13,168 10,199
------------------------------- ----- ---------- ---------- ---------
Total current liabilities 115,324 111,950 46,328
------------------------------- ----- ---------- ---------- ---------
Total liabilities 147,207 151,232 83,279
------------------------------- ----- ---------- ---------- ---------
Total equity and liabilities 200,328 204,266 135,827
------------------------------- ----- ---------- ---------- ---------
Consolidated cash flow statement
six months ended 30 September 2012
Unaudited Unaudited
six months six months
ended ended 12 months
30 September 30 ended 31
September March
2012 2011 2012
GBP000 GBP000 GBP000
---------------------------------------------- ------------- ----------- ----------
Cash flows from operating activities
Profit for the year 1,903 1,471 1,417
Adjustments for:
Depreciation 1,914 1,951 3,753
Impairment of tangible fixed assets - 214 -
Amortisation of intangible assets 318 261 534
Finance expenses - continuing operations 1,929 1,994 3,635
Income tax credit - continuing operations 630 662 1,753
(Profit)/loss on sales of property, plant
and equipment (251) (7) 220
Loss on external sale of intangible fixed
assets 1 - 4
Profit on disposal of assets held for
resale - (15) (8)
Equity-settled share-based payment 55 53 43
---------------------------------------------- ------------- ----------- ----------
Operating profit after adjustments for
non-cash items 6,499 6,584 11,351
Change in trade and other receivables (48,675) (48,188) 224
Change in inventory (18,116) (18,643) 2,840
Change in trade and other payables 21,754 20,658 (1,799)
Change in provisions and deferred income (524) (275) (1,102)
---------------------------------------------- ------------- ----------- ----------
Cash (used by)/generated from operations (39,062) (39,864) 11,514
Tax paid (452) (388) (1,131)
Interest and similar charges paid (1,757) (1,628) (3,491)
Receipts from sales of property for resale - 528 528
Net cash (outflow)/inflow from operating
activities (41,271) (41,352) 7,420
---------------------------------------------- ------------- ----------- ----------
Cash flow from investing activities
Proceeds from sale of property, plant
and equipment 403 42 122
Acquisition of intangible assets (88) (166) (399)
Acquisition of property, plant and equipment (1,339) (1,187) (4,015)
---------------------------------------------- ------------- ----------- ----------
Net cash outflow from investing activities (1,024) (1,311) (4,292)
---------------------------------------------- ------------- ----------- ----------
Cash flows from financing activities
Proceeds from issue of share capital 237 39 146
Repayment of secured borrowings (3,504) (1,118) (1,473)
Net movement in credit facilities 43,543 11,799 (27,785)
Payment of finance lease liabilities (37) (35) (49)
New bank loans raised - 30,170 30,170
Loan arrangement fees (444) - (370)
Payment of deferral consideration - - (111)
Dividends paid to non-controlling interests (968) (918) (918)
Net cash inflow/(outflow) from financing
activities 38,827 39,937 (390)
---------------------------------------------- ------------- ----------- ----------
Net increase in cash and cash equivalents (3,468) (2,726) 2,738
Cash and cash equivalents at end of period 1,223 (1,735) (1,735)
Effect of exchange rate fluctuations
on cash held (172) 255 220
---------------------------------------------- ------------- ----------- ----------
Cash and cash equivalents at end of the
period (2,417) (4,206) 1,223
---------------------------------------------- ------------- ----------- ----------
Notes to the interim financial statements
1 Accounting policies
Basis of preparation
The financial information contained in this interim report does
not constitute statutory accounts as defined in Section 434 of the
Companies Act 2006 and is unaudited.
The Group interim report has been prepared and approved by the
Directors in accordance with International Financial Reporting
Standards as adopted by the EU ("Adopted IFRSs"). The financial
information for the year ended 31 March 2012 is extracted from the
statutory accounts of the Group for that financial year and does
not constitute statutory accounts as defined in Section 434 of the
Companies Act 2006. The report of the auditors was (i) unqualified;
(ii) did not include a reference to any matters to which the
auditors drew attention by way of emphasis without qualifying their
report; and (iii) did not contain a statement under Section 498 (2)
of the Companies Act 2006.
Going concern basis
The financial statements have been prepared on the going concern
basis. Following the restructure of its principal banking
facilities in July 2011 the Group now shows net current assets of
GBP18.0 million (2011 H1: GBP23.3 million).
The borrowing requirement of the Group increases steadily over
the period from July and peaks in September and October, due to the
seasonality of the business, as the sales of wrap and crackers are
mainly for the Christmas market, before then reducing.
As with any company placing reliance on external entities for
financial support, the Directors acknowledge that there can be no
certainty that this support will continue although, at the date of
approval of this interim report, they have no reason to believe
that it will not do so.
After making enquiries, the Directors have a reasonable
expectation that the Company and the Group have adequate resources
to continue in operational existence for the foreseeable future.
Thus, they continue to adopt the going concern basis of accounting
in preparing the financial statements.
The interim report does not include all the information and
disclosures required in the annual financial statements and should
be read in conjunction with the Group's annual financial statements
as at 31 March 2012.
Significant accounting policies
The accounting policies adopted in the preparation of the
interim report are consistent with those followed in the
preparation of the Group's annual financial statements for the year
ended 31 March 2012.
2 Segmental information
The Group has one material business activity being the design,
manufacture and distribution of gift packaging and greetings,
stationery and creative play products.
For management purposes the Group is organised into four
geographic business units.
The results below are allocated based on the region in which the
businesses are located; this reflects the Group's management and
internal reporting structure. The decision was made last year to
focus Asia as a service provider of manufacturing and procurement
operations, whose main customers are our UK businesses. Both the
China factory and the majority of the Hong Kong procurement
operations are now overseen by our UK operational management team
and we therefore continue to include Asia within the internal
reporting of the UK operations, such that UK and Asia comprise an
operating segment. The chief operating decision maker is the
Board.
Intra-segment pricing is determined on an arm's length basis.
Segment results include items directly attributable to a segment as
well as those that can be allocated on a reasonable basis.
Financial performance of each segment is measured on operating
profit. Interest expense or revenue and tax are managed on a Group
basis and not split between reportable segments.
Segment assets are all non-current and current assets, excluding
deferred tax and income tax receivable. Where cash is shown in one
segment, which nets under the Group's banking facilities, against
overdrafts in other segments, the elimination is shown in the
eliminations column. Similarly inter-segment receivables and
payables are eliminated.
2 Segmental information continued
UK and Asia Europe USA Australia Eliminations Group
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
-------------------------------------- ----------- --------- --------- ---------- ------------- ----------------
Six months ended
30 September 2012
Continuing operations
Revenue - external 63,527 11,122 27,322 13,236 - 115,207
- inter-segment 968 143 - - (1,111) -
-------------------------------------- ----------- --------- --------- ---------- ------------- ----------------
Total segment revenue 64,495 11,265 27,322 13,236 (1,111) 115,207
-------------------------------------- ----------- --------- --------- ---------- ------------- ----------------
Segment result before
exceptional items 3,277 488 1,519 826 - 6,110
Exceptional items - - - (750) - (750)
-------------------------------------- ----------- --------- --------- ---------- ------------- ----------------
Segment result 3,277 488 1,519 76 - 5,360
-------------------------------------- ----------- --------- --------- ---------- ------------- ----------------
Central administration
costs (898)
Net finance expenses (1,929)
Income tax (630)
-------------------------------------- ----------- --------- --------- ---------- ------------- ----------------
Profit from continuing
operations for the
six months ended
30 September 2012 1,903
-------------------------------------- ----------- --------- --------- ---------- ------------- ----------------
Balances at 30 September
2012
Continuing operations
-------------------------------------- ----------- --------- --------- ---------- ------------- ----------------
Segment assets 137,888 23,891 23,225 12,559 2,765 200,328
-------------------------------------- ----------- --------- --------- ---------- ------------- ----------------
Segment liabilities (80,031) (21,370) (40,100) (6,520) 814 (147,207)
-------------------------------------- ----------- --------- --------- ---------- ------------- ----------------
Capital expenditure
- property, plant
and equipment 405 91 159 684 - 1,339
- intangible 49 8 19 12 - 88
Depreciation 1,079 403 342 90 - 1,914
Amortisation 228 28 18 44 - 318
-------------------------------------- ----------- --------- --------- ---------- ------------- ----------------
2 Segmental information continued
UK and Asia Europe USA Australia Eliminations Group
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
------------------------ -------------- --------- --------- ---------- ------------- ----------
Six months ended
30 September 2011
Continuing operations
Revenue - external 59,945 12,409 23,764 14,159 - 110,277
- inter-segment 1,889 360 - - (2,249) -
------------------------ -------------- --------- --------- ---------- ------------- ----------
Total segment
revenue 61,834 12,769 23,764 14,159 (2,249) 110,277
------------------------ -------------- --------- --------- ---------- ------------- ----------
Segment result
before exceptional
items 3,058 701 1,145 1,405 - 6,309
Exceptional items (225) - - - - (225)
------------------------ -------------- --------- --------- ---------- ------------- ----------
Segment result 2,833 701 1,145 1,405 - 6,084
------------------------ -------------- --------- --------- ---------- ------------- ----------
Central administration
costs (1,102)
Central administration
exceptional items (855)
Net finance expenses (1,994)
Income tax (662)
------------------------ -------------- --------- --------- ---------- ------------- ----------
Profit from continuing
operations for
the
six months ended
30 September 2011 1,471
------------------------ -------------- --------- --------- ---------- ------------- ----------
Balances at 30 September
2011
Continuing operations
------------------------ -------------- --------- --------- ---------- ------------- ----------
Segment assets 143,246 24,324 19,158 12,781 4,757 204,266
------------------------ -------------- --------- --------- ---------- ------------- ----------
Segment liabilities (81,867) (21,766) (39,632) (7,388) (579) (151,232)
------------------------ -------------- --------- --------- ---------- ------------- ----------
Capital expenditure
- property, plant
and equipment 232 746 147 62 - 1,187
- intangible 72 29 48 17 - 166
Depreciation 1,119 395 346 91 - 1,951
Amortisation 178 29 12 42 - 261
Impairment of
property, plant
and equipment 214 - - - - 214
------------------------ -------------- --------- --------- ---------- ------------- ----------
The six months ended 30 September 2011 comparatives have been
amended to reflect revisions to the inter-segment reporting and
eliminations between segments.
2 Segmental information continued
UK and Asia Europe USA Australia Eliminations Group
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
------------------------ -------------- --------- --------- ---------- ------------- ---------
Year ended 31 March
2012
Continuing operations
Revenue - external 117,007 29,147 45,044 29,557 - 220,755
- inter-segment 4,746 1,009 - - (5,755) -
------------------------ -------------- --------- --------- ---------- ------------- ---------
Total segment
revenue 121,753 30,156 45,044 29,557 (5,755) 220,755
------------------------ -------------- --------- --------- ---------- ------------- ---------
Segment result
before exceptional
items
and discontinued
operations 4,089 1,712 3,248 3,613 - 12,662
Exceptional items (3,068) - - - - (3,068)
------------------------ -------------- --------- --------- ---------- ------------- ---------
Segment result 1,021 1,712 3,248 3,613 - 9,594
------------------------ -------------- --------- --------- ---------- ------------- ---------
Central administration
costs (1,939)
Central administration
exceptional items (850)
Net finance expenses (3,635)
Income tax (1,753)
------------------------ -------------- --------- --------- ---------- ------------- ---------
Profit from continuing
operations year
ended 31 March
2012 1,417
------------------------ -------------- --------- --------- ---------- ------------- ---------
Balances at 31 March
2012
Continuing operations
Segment assets 97,100 16,885 6,224 11,317 4,301 135,827
------------------------ -------------- --------- --------- ---------- ------------- ---------
Segment liabilities (40,562) (13,950) (25,029) (3,222) (516) (83,279)
------------------------ -------------- --------- --------- ---------- ------------- ---------
Capital expenditure
- property, plant
and equipment 1,185 2,437 331 62 - 4,015
- intangible 263 30 87 19 - 399
Depreciation 2,135 742 696 180 - 3,753
Amortisation 368 57 24 85 - 534
------------------------ -------------- --------- --------- ---------- ------------- ---------
3 Exceptional items
6 months 6 months 12 months
ended 30 ended 30 ended 31
September September March
2012 2011 2012
GBP000 GBP000 GBP000
-------------------------------------------- ----------- ----------- ----------
Restructuring of operational activities
Bad debt provision (note a) 750 - -
Redundancies (note b) - 855 1,201
Impairment of leasehold land and buildings
in China
(note c) - 225 283
China factory move (note d) - - 2,434
-------------------------------------------- ----------- ----------- ----------
Total restructuring costs 750 1,080 3,918
Income tax credit (224) (222) (1,951)
-------------------------------------------- ----------- ----------- ----------
526 858 3,723
-------------------------------------------- ----------- ----------- ----------
(a) Provision for debtor now in voluntary administration
relating to our Joint Venture in Australia
(b) Redundancies relate to the termination costs of key
executives who left the business following a review of Board
responsibilities and as a result of business re-organisation in the
UK subsidiaries
(c) Loss on disposal of leasehold land and buildings in China as
a result of the decision to move the China factory
(d) Costs associated with moving the China factory
4 Cash, loans and borrowing
6 months 6 months 12 months
ended 30 ended 30 ended 31
September September March
2012 2011 2012
GBP000 GBP000 GBP000
---------------------------------------- ----------- ----------- ----------
Secured bank loan (short term) (4,685) (3,918) (3,974)
Secured bank loan (long term) (29,340) (34,926) (33,880)
Asset backed loans (30,860) (36,811) (5,467)
Revolving credit facilities (17,839) (8,654) -
Loan arrangement fees 671 - 370
---------------------------------------- ----------- ----------- ----------
Total loans (82,053) (84,309) (42,951)
Cash and bank deposits 3,403 1,734 3,168
Bank overdraft (5,820) (5,940) (1,945)
---------------------------------------- ----------- ----------- ----------
Cash and cash equivalents per cash
flow statement (2,417) (4,206) 1,223
---------------------------------------- ----------- ----------- ----------
Net debt used in the Chief Executive's
Review (84,470) (88,515) (41,728)
---------------------------------------- ----------- ----------- ----------
5 Taxation
Six months Six months 12 months
ended 30 ended 30 ended 31
September September March
2012 2011 2012
GBP000 GBP000 GBP000
-------------------------------------- ----------- ----------- ----------
Current tax expenses
Current income tax charge (149) (825) (1,789)
Deferred tax expense
Relating to original and reversal of
temporary differences (481) 163 36
-------------------------------------- ----------- ----------- ----------
Total tax in income statement (630) (662) (1,753)
-------------------------------------- ----------- ----------- ----------
Taxation for the six months ended 30 September 2012 is based on
the effective rate of taxation, which is estimated to apply in each
country for the year ended 31 March 2013.
6 Earnings per share
As at As at As at
30 September 30 September 31 March 2012
2012 2011
----------------- ----------------- -----------------
Diluted Basic Diluted Basic Diluted Basic
------------------------------- -------- ------- -------- ------- -------- -------
Adjusted earnings per
share excluding
exceptional items 3.7p 3.9p 3.2p 3.4p 6.7p 7.2p
Loss per share on exceptional
items (0.5)p (0.5)p (1.5)p (1.6)p (6.4)p (6.9p)
------------------------------- -------- ------- -------- ------- -------- -------
Earnings per share from
continuing operations 3.2p 3.4p 1.7p 1.8p 0.3p 0.3p
Earnings per share 3.2p 3.4p 1.7p 1.8p 0.3p 0.3p
------------------------------- -------- ------- -------- ------- -------- -------
The basic earnings per share is based on the profit attributable
to equity holders of the Parent Company of GBP1,874,000 (2011:
GBP993,000) and the weighted average number of ordinary shares in
issue of 55,799,000 (2011: 54,103,000) calculated as follows:
September September March
Weighted average number of shares 2012 2011 2012
in thousands of shares
---------------------------------------- ---------- ---------- -------
Issued ordinary shares at 1 April 55,007 53,967 53,967
Shares issued in respect of exercising
of share options 792 136 239
---------------------------------------- ---------- ---------- -------
Weighted average number of shares
at end of the period 55,799 54,103 54,206
---------------------------------------- ---------- ---------- -------
Total number of options, over 5p ordinary shares, in issue at 30
September 2012 was 3,451,956.
Adjusted basic earnings per share excludes exceptional items
charged of GBP375,000 (2011: GBP1,080,000) being the share of our
Joint Venture attributable to shareholders, along with the tax
relief attributable to those items of GBP112,000 (2011:
GBP222,000). This gives an adjusted profit of GBP2,137,000 (2011:
GBP1,851,000).
This information is provided by RNS
The company news service from the London Stock Exchange
END
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