TIDMRNWH
RNS Number : 0421S
Renew Holdings PLC
27 November 2012
Renew Holdings plc
("Renew" or the "Group")
Preliminary results
Renew (AIM: RNWH), the Engineering Services Group supporting UK
infrastructure, announces record preliminary results for the year
ended 30 September 2012 ahead of expectations.
Financial Highlights
2012 2011
Revenue GBP337.4m GBP352.8m -4%
Adjusted operating profit* GBP10.3m GBP7.9m +30%
Operating margin 3.1% 2.2% +41%
Adjusted profit before
tax* GBP10.0m GBP8.2m +22%
Reported profit before
tax GBP8.4m GBP2.6m +223%
Adjusted earnings per
share* 13.9p 9.7p +43%
Basic earnings per share 7.9p 2.2p +259%
Dividend per share 3.15p 3.0p +5%
Operational Highlights
-- Engineering Services revenue up 24% to GBP214.1m (2011: GBP172.8m)
-- Engineering Services adjusted operating profit* up 28% to
GBP9.6m (2011: GBP7.5m) - an increase in margin to 4.5% (2011:
4.3%)
-- Group order book up 16% to GBP331m (2011: GBP286m) with
Engineering Services order book up 31% to GBP235m (2011:
GBP179m)
-- Nuclear order book up 51% to GBP109m (2011: GBP72m)
-- Net debt reduced to GBP5.5m (2011: GBP6.8m)
* Adjusted results are shown prior to exceptional items of
GBP1.1m (2011: GBP5.2m), amortisation charges of GBP0.5m (2011:
GBP0.4m) and a GBP2.4m loss from a discontinued operation.
Commenting on the results, Roy Harrison OBE, Chairman said: "Our
recent success in key framework appointments in Nuclear, Rail and
Water together with our strong list of future opportunities
demonstrates that the Group is pursuing the right strategy,
evidenced by our growing forward order book and our record
financial results."
Enquiries:
Renew Holdings plc Tel: 0113 281 4200
Brian May, Chief Executive
John Samuel, Group Finance
Director
Numis Securities Limited Tel: 020 7260 1000
Stuart Skinner (Nominated
Adviser)
James Serjeant (Corporate
Broker)
Walbrook PR Tel: 020 7933 8780
Paul McManus (Media Relations) Mob: 07980 541 893 or paul.mcmanus@walbrookpr.com
Paul Cornelius (Investor Mob: 07827 879 496 or paul.cornelius@walbrookir.com
Relations)
About Renew Holdings plc
Engineering Services, which accounts for over 60% of Group
revenue and over 90% of operating profit, focuses on the key
markets of Energy (including Nuclear), Environmental and
Infrastructure, which are largely governed by regulation and
benefit from non-discretionary spend with long-term visibility of
committed funding.
Specialist Building focuses on New Build Affordable Housing,
High Quality Residential and Retail markets in the South of
England.
The Group has 76 framework agreements; 62 of these are in
Engineering Services with 45 of those being maintenance in
nature.
For more information please visit the Renew Holdings plc
website: www.renewholdings.com
Chairman's Statement
Results
The Group has achieved record results for the year ended 30
September 2012, ahead of market expectations, and has strengthened
its position as a provider of Engineering Services to UK
infrastructure.
Profit before income tax was up 22% to GBP10.0m (2011: GBP8.2m)
on Group revenue of GBP337.4m (2011: GBP352.8m). Adjusted earnings
per share increased by 43% to 13.9p (2011: 9.7p). Basic earnings
per share increased by 259% to 7.9p (2011: 2.2p)
Results for the year are stated after charging exceptional costs
and amortisation charges of GBP1.6m (2011: GBP5.6m) and a loss of
GBP2.4m from the discontinued operation, C&A Pumps Ltd, which
was sold in November 2012 for a nominal consideration. These
amounts have been excluded from the adjusted financial results to
show the underlying performance of the business. The exceptional
costs in the period of GBP1.1m (2011: GBP5.2m) relate to the
planned scale down of Specialist Building and the integration of
our rail business following the acquisition of Amco.
It is particularly pleasing that Engineering Services revenue
grew by 24% to GBP214.1m (2011: GBP172.8m), with operating profit
prior to exceptional items and amortisation up 28% to GBP9.6m
(2011: GBP7.5m), an increase in margin to 4.5% from 4.3%. Both our
Nuclear and Rail businesses, which represent over 60% of our
Engineering Services activity, performed strongly and have growing
order books for both the new financial year and beyond.
In Specialist Building, our focus on selective niche markets in
the South, has delivered increased operating profit of GBP2.1m
(2011: GBP1.9m) prior to exceptional items and an improvement in
margin to 1.7% from 1.1% on revenue of GBP123.1m (2011:
GBP178.9m).
The Group's contracted order book at 30 September 2012 stood at
GBP331m (2011: GBP286m), a 16% increase from one year ago, with the
Engineering Services order book up 31% to GBP235m (2011:
GBP179m).
The Group has reduced net debt to GBP5.5m (2011: GBP6.8m)
comprising a loan of GBP7.5m (2011: GBP12.5m) and cash of GBP2.0m
(2011: GBP5.7m).
Dividend
The Board is proposing a final dividend at 2.10p per share,
increasing the full year dividend by 5% to 3.15p (2011: 3.00p). The
dividend will be paid on 4 March 2013 to shareholders on the
register as at 1 February 2013. The dividend is 4.4x (2011: 3.2x)
covered by adjusted earnings per share.
Outlook
The Group is successfully positioned as a provider of
engineering services to key clients in the UK's Energy,
Environmental and Infrastructure markets, and has been reclassified
on the London Stock Exchange as a Business Support Services
company.
Last year, the Board declared its ambition to grow turnover to
over GBP500m by 2014, through both organic growth and selective
acquisitions, with targets that Engineering Services will account
for at least 70% of Group revenue and that the Group operating
margin will exceed 3%. These results and our strong forward order
book demonstrate that the Group is well placed to achieve these
targets.
Our acquisition of Amco in February 2011 has proved highly
successful, delivering results ahead of our expectations and
generating cash such that we have now repaid 50% of the GBP15m term
loan taken out for the acquisition. Our reducing net debt and net
gearing of 62% (2011: 76%) together with our interest cover of over
16x provides the Group with funding flexibility should further
suitable acquisition opportunities be identified.
Our Engineering Services operations continue to focus on
securing further sustainable framework positions, concentrating on
areas of non-discretionary spend. In Specialist Building, our
businesses are delivering improved operating margins as they target
the stable markets of High Quality Residential, New Build
Affordable Housing and Retail in the South, where the Group has
particular expertise and experience.
The Board believes our key markets and framework positions
provide good and continuing opportunities through 2013 and beyond
and that the Group is well positioned to deliver further profitable
growth.
R J Harrison OBE
Chairman
27 November 2012
Chief Executive's Review
The Group has made further progress in growing its Engineering
Services business which focuses on supporting the maintenance and
renewal of UK infrastructure increasing both revenue and operating
profit. Specialist Building has increased its operating margin in
the year and is concentrated on sustainable markets in the
South.
Engineering Services
Renew provides integrated engineering services nationwide
focusing on the highly regulated markets of Energy, Environmental
and Infrastructure. The Group concentrates on the renewal and
maintenance of essential operational assets delivered through its
multidisciplinary workforce employed by our strong local and
independently branded businesses.
Our strategy is delivering both strong financial results and
growth. Revenue in Engineering Services grew by 24% to GBP214.1m
(2011: GBP172.8m) and now accounts for 63% of ongoing Group revenue
and over 90% of operating profit. Operating margin increased to
4.5% (2011: 4.3%).
The Engineering Services order book is growing strongly and is
underpinned by 62 frameworks, an increase of 22% in the year, of
which 45 are for maintenance work. Non-discretionary orders account
for 95% of the GBP235m (2011: GBP179m) order book which has grown
by 31% in the year.
Our order book in Energy grew by 51% to GBP124m (2011: GBP82m),
by 14% in Environmental to GBP33m (2011: GBP29m) and by 15% in
Infrastructure to GBP78m (2011: GBP68m).
It remains the Group's strategy to grow its Engineering Services
both organically and by targeting earnings enhancing acquisitions
in sustainable markets. The recent appointment of Paul Scott,
Managing Director of our Nuclear business, as Engineering Services
Director, will assist in developing our integrated offering to
these markets.
Energy
Renew operates nationally in the nuclear, renewable and
traditional power generation sectors where work concentrates on the
critical planned and reactive maintenance and asset renewal
programmes. Much of the work is delivered through our 24 framework
agreements.
In Nuclear, Renew operates across the Nuclear Decommissioning
Authority ("NDA") estate in high hazard reduction programmes,
decommissioning and in operational asset care. We are strongly
positioned with engagements on 9 licenced nuclear sites that
command around 70% of the NDA's GBP3bn annual expenditure. Within
that budget, over 55% of the spend is allocated to Sellafield,
where we have been active for over 60 years and where we are the
principal provider of mechanical and electrical services.
Our revenue at Sellafield grew by 12% in the last twelve months
and has grown by over 150% in the last 7 years. All of our 2012/13
revenue budget in Nuclear is already secured in an order book that
has grown by 51% to GBP109m (2011: GBP72m).
Operational asset care is vital to Sellafield which derives
substantial revenue from spent fuel management and reprocessing.
For the last 15 years we have carried out production operations
support under the Multi Discipline Site Works framework. Since the
year end, we have again been appointed as one of three participants
to deliver work packages worth up to GBP280m over 4 years
commencing in April 2013. During the year, we were also appointed
as the sole mechanical and electrical partner to Stobbarts on the
GBP58m Site Wide Asset Care framework which runs until April
2016.
During the year, in high hazard risk reduction, we were
appointed as sole participant to the 4 year GBP26m Bulk Sludge
Retrievals Framework and we deliver a wide range of decommissioning
tasks through the Decommissioning Framework Agreement which is
secured until 2015. The Evaporator D programme is the UK's largest
current nuclear project where our mechanical and electrical
services contract has recently been extended to provide over GBP50m
of work through to completion in 2015. We are able to secure
positions on these highly sensitive programmes due to the large
number of our employees who carry the highest level of site
security clearance.
Our predominant position on the site makes us a partner of
choice on major programmes. A good example of this is our
appointment as a Supply Chain Partner to Morgan Sindall which
recently announced its appointment as preferred delivery partner
for a potential GBP1.1bn contract delivering a range of essential
services at the Sellafield site, under the Infrastructure Strategic
Alliance. These services will include the maintenance of steam and
electricity generation, water supply, chemical storage and
distribution, drainage networks and all transport infrastructure at
the site.
The Group undertakes work at 8 other nuclear licenced sites
across the UK including work on the 2 year decommissioning and
demolition contract associated with a redundant Fuel Manufacturing
Facility at Springfields for Westinghouse. We continue to support
the consortia involved in the Nuclear New Build programme where we
provide skills in stainless steel fabrications.
We continue to provide support at some of the UK's largest
traditional power stations, where we provide maintenance services
under 7 framework agreements. There are also increasing
opportunities in the renewables market and we are active in
investment programmes in biomass and hydro generation technologies
where we are currently delivering initial works on two 3 year
hydroelectric frameworks with Scottish Water and Welsh Water.
Environmental
The Group has extensive expertise in water infrastructure
development and operational maintenance, flood alleviation, river
and coastal defences and land remediation. A large portion of work
in this sector is procured under long term framework
agreements.
In Water, we continue to work for Northumbrian Water under the
10 year AMP5 programme. In addition to carrying out works under the
major waste water project framework we now have a position on 7
non-discretionary maintenance frameworks which accounts for 80% of
ongoing activity. In particular we have developed specialist skills
in providing services to the existing trunk mains network both in
cleaning and general maintenance. This shift in the profile of our
work in the Water sector has led to a doubling of our order book at
the year end and an improvement in margins which we expect to build
upon in 2012/13.
In Land Remediation, we extended our 16 year relationship with
National Grid where we were reappointed to 3 remediation frameworks
nationally. Also in the year we were appointed to the Environment
Agency's National Contaminated Land Remediation Contractors
framework which runs to 2015. Ongoing work for the Environment
Agency is delivered through 7 minor works and river maintenance
frameworks for civil, mechanical and electrical services.
Infrastructure
The Group continues to access the rail, highways and industrial
markets across the UK where work is underpinned by 17 framework
agreements for the delivery of integrated civil, mechanical and
electrical engineering services.
The majority of activity this year has been in Rail where we
have seen a 23% increase in our order book to GBP74m (2011:
GBP60m). Our focus is on the renewal, refurbishment and maintenance
of operational assets for clients, including our largest client
Network Rail where we remain a leading provider of engineering
maintenance works. These works include off-track renewal and
maintenance of line side structures including tunnels, bridges and
viaducts, mechanical and electrical installations and the delivery
of a wide range of planned and reactive maintenance services. We
have particular skills in managing complicated tunnel refurbishment
projects and earlier this year completed our largest individual
project at Ore Tunnel near Hastings.
During the year our existing Asset Management frameworks were
renewed for up to 5 years and extended by a new framework
appointment in Scotland. These frameworks, along with our
established Buildings and Civils Delivery Partnership framework
agreements, where we have seen increased spend, have reinforced our
position with Network Rail as the only provider delivering these
services nationally.
The recent McNulty Report recommends the devolution of
responsibility so that decisions are made as close to customers and
the market as possible. Network Rail has commenced implementation
of these recommendations by appointing management responsible for
the 10 operating routes. As the only national provider of off-track
maintenance of existing assets, with 12 local depots spread across
the country, these initiatives play to our strengths and we are
well placed to support our key Rail client as these changes are
implemented.
Specialist Building
The Group's Specialist Building activities are focused in the
South targeting the High Quality Residential, New Build Affordable
Housing and Retail markets. These niche markets, in which we have
particular experience and expertise, provide sustainable
opportunities for the future. Following our decision to withdraw
from public sector building markets in the North, Specialist
Building revenue reduced as expected to GBP123.1m (2011: GBP178.9m)
whilst delivering operating profits up 11% at GBP2.1m (2011:
GBP1.9m) and increasing operating margin to 1.7% (2011: 1.1%),
thereby justifying our strategy.
In High Quality Residential, the Group's activities are focused
in and around London where the market remains strong with over
GBP400m of current opportunities identified. Our experience in this
sector as a leading quality provider with particular skills in
providing the temporary works engineering solutions to extend
properties below ground, continues to prove a differentiator and
provides opportunity for early involvement in schemes.
In New Build Affordable Housing, the Group has recently been
appointed to a new framework with Catalyst Housing where, as one of
7 providers, we will access up to an advertised GBP350m of projects
over the next 4 years. The Group now has a position on 14 framework
agreements with leading Housing Associations which provide access
to a GBP700m annual market.
In Retail, there remains good visibility of opportunities with
new clients including Morrisons and Odeon Cinemas. We continue our
24 year relationship with Tesco and remain the preferred fit out
contractor for Cineworld.
People
We are committed to the safety of our employees and those who
work with us evidenced in the record reduction in the Group's
Accident Incidence Rate during 2012, now at its lowest figure in 7
years, a reduction of 87% over that period.
The strong financial results demonstrate the skills and
determination of all our employees. The success of the Group
depends on our employees continued hard work and commitment, for
which the Board would like to express its gratitude.
Summary
Renew provides engineering services to support the essential
ongoing operations of critical UK infrastructure through
experienced local delivery teams. The Group is focused on
developing its maintenance, refurbishment and renewal activities in
its target regulated sectors where sustainable revenue is generated
through its core maintenance and renewal frameworks with major
clients, many of which the Group has worked with for a number of
years.
Our recent success in key framework appointments in Nuclear,
Rail and Water together with our strong list of future
opportunities demonstrates that the Group is pursuing the right
strategy, evidenced by our growing forward order book and our
record financial results.
Brian May
Chief Executive
27 November 2012
Group income statement
For the year ended 30 September 2012
Before Exceptional
exceptional items
and
items and amortisation
amortisation of
intangible
of assets
intangible
Note assets (see Note Total Total
3)
2012 2012 2012 2011
GBP000 GBP000 GBP000 GBP000
Group revenue from continuing
activities 2 337,423 - 337,423 352,760
Cost of sales (301,040) - (301,040) (319,661)
------------- ------------- ---------- ----------
Gross profit 36,383 - 36,383 33,099
Administrative
expenses (26,115) (1,620) (27,735) (30,856)
------------- ------------- ---------- ----------
Operating profit 2 10,268 (1,620) 8,648 2,243
Finance income 45 - 45 167
Finance costs (518) - (518) (387)
Other finance income - defined benefit
pension schemes 246 - 246 530
------------- ------------- ---------- ----------
Profit before income
tax 10,041 (1,620) 8,421 2,553
Income tax expense 4 (1,713) 405 (1,308) (1,177)
------------- ------------- ---------- ----------
Profit for the year from continuing activities 8,328 (1,215) 7,113 1,376
------------- -------------
Loss for the year from discontinued operation
3 (2,372) (71)
---------- ----------
Profit for the year attributable to equity
holders of the parent company 4,741 1,305
---------- ----------
Basic earnings per share from continuing
activities 6 13.9p (2.0p) 11.9p 2.3p
------------- ------------- ---------- ----------
Diluted earnings per share from
continuing operations 6 13.3p (1.9p) 11.4p 2.2p
------------- ------------- ---------- ----------
Basic earnings per share 6 7.9p 2.2p
---------- ----------
Diluted earnings per share 6 7.6p 2.1p
---------- ----------
Group statement of comprehensive
income
For the year ended 30 September 2012 2011
2012
GBP000 GBP000
Profit for the year attributable to equity
holders of the parent company 4,741 1,305
Exchange movements in reserves (407) 123
Movement in actuarial valuation of the defined
benefit pension schemes (3,442) (5,265)
Movement on deferred tax relating to the
defined benefit pension schemes 847 1,382
---------- ----------
Total comprehensive income/(expense) for
the year attributable to equity holders of
the parent company 1,739 (2,455)
---------- ----------
Group statement of changes in equity
Called Share Capital Cumulative Share Retained Total
up based
share premium redemption translation payments earnings equity
capital account reserve adjustment reserve
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 1 October 2010 5,990 5,893 3,896 1,059 217 (3,893) 13,162
Transfer from income
statement for the
year 1,305 1,305
Dividends paid (1,797) (1,797)
Recognition of share
based payments 66 66
Exchange differences 123 123
Actuarial losses recognised
in pension schemes (5,265) (5,265)
Movement on deferred
tax relating to the
pension schemes 1,382 1,382
---------- ---------- ------------- ------------- ------------- ---------- ----------
At 30 September 2011 5,990 5,893 3,896 1,182 283 (8,268) 8,976
Transfer from income
statement for the
year 4,741 4,741
Dividends paid (1,827) (1,827)
Recognition of share
based payments 6 6
Exchange differences (407) (407)
Actuarial losses recognised
in pension schemes (3,442) (3,442)
Movement on deferred
tax relating to the
pension schemes 847 847
---------- ---------- ------------- ------------- ------------- ---------- ----------
At 30 September 2012 5,990 5,893 3,896 775 289 (7,949) 8,894
---------- ---------- ------------- ------------- ------------- ---------- ----------
Group balance sheet
At 30 September 2012
2012 2011
(Restated*)
GBP000 GBP000
Non-current assets
Intangible assets - goodwill 26,918 27,726
- other 2,250 2,750
Property, plant and equipment 4,690 4,805
Retirement benefit assets 1,820 1,089
Deferred tax assets 2,929 3,329
38,607 39,699
---------- ------------
Current assets
Inventories 9,109 8,918
Trade and other receivables 73,958 84,901
Current tax assets 834 646
Cash and cash equivalents 2,040 5,688
---------- ------------
85,941 100,153
---------- ------------
Total assets 124,548 139,852
---------- ------------
Non-current liabilities
Borrowings (2,500) (7,500)
Obligations under finance leases (676) (369)
Retirement benefit obligations (569) (119)
Deferred tax liabilities (1,039) (1,091)
Provisions (566) (566)
---------- ------------
(5,350) (9,645)
---------- ------------
Current liabilities
Borrowings (5,000) (5,000)
Trade and other payables (104,302) (115,543)
Obligations under finance leases (570) (291)
Current tax liabilities (266) (231)
Provisions (166) (166)
---------- ------------
(110,304) (121,231)
---------- ------------
Total liabilities (115,654) (130,876)
---------- ------------
Net assets 8,894 8,976
---------- ------------
Share capital 5,990 5,990
Share premium account 5,893 5,893
Capital redemption reserve 3,896 3,896
Cumulative translation reserve 775 1,182
Share based payments reserve 289 283
Retained earnings (7,949) (8,268)
---------- ------------
Total equity 8,894 8,976
---------- ------------
* Balance sheet has been restated for hindsight fair value
adjustment on acquisition of Amco Group Holdings Ltd.
Group cash flow statement
For the year ended 30 September
2012 2011
GBP000 GBP000
Profit for the year from continuing
operations 7,113 1,376
Amortisation of intangible assets 500 404
Depreciation 905 1,111
Profit on sale of property, plant and equipment (17) (32)
Increase in inventories (501) (248)
Decrease in receivables 10,081 8,567
Decrease in payables (10,969) (337)
Current service cost in respect of defined benefit
pension scheme 54 56
Cash contribution to defined benefit pension
schemes (3,477) (4,039)
Expense in respect of share options 6 66
Financial income (291) (697)
Financial expenses 518 387
Interest paid (518) (387)
Income taxes paid (333) (523)
Income tax expense 1,308 1,177
--------- ---------
Net cash inflow from continuing operating activities 4,379 6,881
Net cash outflow from discontinued operating
activities (794) (205)
--------- ---------
Net cash inflow from operating activities 3,585 6,676
--------- ---------
Investing activities
Interest received 45 167
Proceeds on disposal of property, plant and
equipment 191 1,768
Purchases of property, plant and equipment (1,253) (843)
Acquisition of subsidiaries net of cash acquired - (29,319)
--------- ---------
Net cash outflow from continuing investing
activities (1,017) (28,227)
Net cash inflow from discontinued investing
activities 36 8
--------- ---------
Net cash outflow from investing activities (981) (28,219)
--------- ---------
Financing activities
Dividends paid (1,827) (1,797)
New loan - 15,000
Loan repayments (5,000) (2,500)
Inception of new leases 983 396
Repayments of obligations under finance leases (396) (109)
--------- ---------
Net cash (outflow)/inflow from financing activities (6,240) 10,990
Net cash (outflow) from discontinued financing
activities - (6)
--------- ---------
Net cash (outflow)/inflow from financing activities (6,240) 10,984
--------- ---------
Net decrease in continuing cash and cash equivalents (2,878) (10,356)
Net decrease in discontinued cash and cash
equivalents (758) (203)
--------- ---------
Net decrease in cash and cash equivalents (3,636) (10,559)
Cash and cash equivalents at beginning of year 5,688 16,245
Effect of foreign exchange rate changes on cash and
cash equivalents (12) 2
--------- ---------
Cash and cash equivalents at end of year 2,040 5,688
---------
Bank balances and cash 2,040 5,688
--------- ---------
Notes
1 International Financial Reporting Standards
The consolidated financial statements for the year ended 30
September 2012 have been prepared in accordance with International
Financial Reporting Standards ("IFRS"). These preliminary results
are extracted from those financial statements.
2 Segmental analysis
The Group's businesses are organised into two operating segments
which form the basis of the segment information reported below.
These segments are:
Engineering Services, which comprises the Group's engineering
activities which are characterised by the use of the Group's
skilled engineering workforce, supplemented by specialist
subcontractors where appropriate, in a range of civil, mechanical
and electrical engineering applications and:
Specialist Building, which comprises the Group's building
activities which are characterised by the use of a supply chain of
subcontractors to carry out building works under the control of the
Group as principal contractor.
2012 2011
Revenue is analysed as follows: GBP000 GBP000
Engineering Services 214,102 172,808
Specialist Building 123,070 178,902
Inter segment revenue (179) (61)
-------- --------
Segment revenue 336,993 351,649
Central activities 430 1,111
-------- --------
Group revenue from continuing
activities 337,423 352,760
-------- --------
Before
exceptional Exceptional
items and items and
amortisation amortisation
charges charges 2012 2011
Analysis of operating profit GBP000 GBP000 GBP000 GBP000
From continuing activities
Engineering Services 9,639 (986) 8,653 6,608
Specialist Building 2,134 (634) 1,500 (1,425)
Segment operating profit 11,773 (1,620) 10,153 5,183
Central activities (1,505) - (1,505) (2,940)
------------- ------------- -------------------- ----------
Operating profit 10,268 (1,620) 8,648 2,243
Net financing (expense)/income (227) - (227) 310
------------- ------------- -------------------- ----------
Profit on ordinary activities
before income tax 10,041 (1,620) 8,421 2,553
------------- ------------- -------------------- ----------
3 Exceptional items and amortisation of intangible assets
2012 2011
GBP000 GBP000
Redundancy and restructuring costs 1,120 3,680
Amco acquisition costs - 1,357
Provision for Office of Fair Trading
fine - 200
Legal fees in connection with
OFT fine - 10
Total exceptional items 1,120 5,247
Amortisation of intangible assets 500 404
------- -------
1,620 5,651
------- -------
The Board has determined that certain charges to the income
statement should be separately identified for better understanding
of the Group's results.
During the year, the Group has incurred GBP1,120,000 of
exceptional redundancy and restructuring costs. GBP634,000 of these
costs relate to Specialist Building where further staff reductions
have been made to align the segment with the current trading
environment. GBP486,000 relates to Engineering Services which
primarily relates to the integration of our rail businesses
following the acquisition of Amco Group Holdings Ltd.
The Board has also separately identified the charge of
GBP500,000 (2011: GBP404,000) for the amortisation of the fair
value ascribed to certain intangible assets other than goodwill
arising from the acquisitions of Seymour (C.E.C) Holdings Ltd and
Amco Group Holdings Ltd.
Discontinued operation analysis
2012 2011
GBP000 GBP000
Revenue 1,816 3,907
Expenses (3,216) (4,000)
Write off of goodwill and fair (904) -
value adjustment
Loss before income tax (2,304) (93)
Income tax (expense)/credit -
deferred tax (68) 22
-------- --------
Loss for the year from discontinued
operation (2,372) (71)
-------- --------
The discontinued operation, C&A Pumps Ltd, was sold on 14
November 2012 for a nominal consideration.
4 Income tax expense
Analysis of expense in year 2012 2011
GBP000 GBP000
Current tax:
UK corporation tax on profit (266) -
for the year
Adjustments in respect of previous
periods 86 417
---------- --------------
Total current tax (180) 417
---------- --------------
Deferred tax - defined benefit
pension scheme (893) (1,175)
Deferred tax - other timing differences (302) (397)
---------- --------------
Total deferred tax (1,195) (1,572)
---------- --------------
Income tax expense (1,375) (1,155)
Deferred tax in respect of discontinued
operation 67 (22)
---------- --------------
Income tax expense in respect
of continuing activities (1,308) (1,177)
---------- --------------
5 Dividends 2012 2011
Pence/share Pence/share
Interim (related to the year ended 30
September 2012) 1.05 1.00
Final (related to the year ended 30 September
2011) 2.00 2.00
-------------- ------------
Total dividend paid 3.05 3.00
-------------- ------------
GBP000 GBP000
Interim (related to the year ended 30
September 2012) 628 598
Final (related to the year ended 30 September
2011) 1,199 1,199
-------------- ------------
Total dividend paid 1,827 1,797
-------------- ------------
Dividends are recorded only when authorised and are shown as a
movement in equity rather than as a charge in the income statement.
The Directors are proposing that a final dividend of 2.10p per
Ordinary Share be paid in respect of the year ended 30 September
2012. This will be accounted for in the 2012/13 financial year.
6 Earnings per share
2012 2011
Earnings EPS DEPS Earnings EPS DEPS
GBP000 Pence Pence GBP000 Pence Pence
Earnings before
exceptional costs
& amortisation 8,328 13.90 13.33 5,807 9.69 9.35
Exceptional costs
& amortisation (1,215) (2.03) (1.95) (4,431) (7.39) (7.13)
-------------- ------- ------- -------------- ------- -------
Basic earnings
per share - continuing 7,113 11.87 11.38 1,376 2.30 2.22
Loss for the
year from discontinued
operation (2,372) (3.96) (3.79) (71) (0.12) (0.12)
-------------- ------- ------- -------------- ------- -------
Basic earning
per share 4,741 7.91 7.59 1,305 2.18 2.10
-------------- ------- ------- -------------- ------- -------
Weighted average
number of shares 59,899 62,493 59,899 62,093
------- ------- ------- -------
The dilutive effect of share options is to increase the number
of shares by 2,594,000 (2011: 2,194,000) and reduce basic earnings
per share by 0.32p (2011: 0.08p).
7 Preliminary financial information
The financial information set out above does not constitute the
Company's statutory accounts for the years ended 30 September 2012
or 2011. The financial information for 2011 is derived from the
statutory accounts for 2011 which have been delivered to the
Registrar of Companies. The auditors have reported on the 2011
accounts; their report 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) or (3) of the Companies
Act 2006. The statutory accounts for 2012 will be finalised on the
basis of the financial information presented by the Directors in
this preliminary announcement and will be delivered to the
Registrar of Companies in due course.
8 Posting of Report & Accounts
The Group confirms that the annual report and accounts for the
year ended 30 September 2012 will be posted to shareholders as soon
as practicable and a copy will be made available on the Group's
website:
www.renewholdings.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR KMMZMVVFGZZM
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