REG - Stobart Group Ltd - Full-year results <Origin Href="QuoteRef">III.L</Origin> <Origin Href="QuoteRef">STOB.L</Origin> - Part 2
15/07/2015 17:33
- Part 2: For the preceding part double click ID:nRSN1313Na
joint ventures (10,444) 2,362
Other loans advanced (300)
Interest received 549 511
Cash inflow from discontinued operations 349 12,018
Net cash flow from investing activities 200,135 10,884
Issue costs paid on ordinary shares - (21)
Dividend paid on ordinary shares (19,808) (20,509)
Repayment of capital element of finance leases (4,939) (2,183)
Proceeds from new borrowings 14,332 14,965
Repayment of borrowings (143,589) (13,419)
(Purchase)/sale of treasury shares, net of costs (34,764) 8,821
Interest paid (2,105) (13,421)
Interest paid - non-underlying (1,278) -
Other finance and transaction costs - (400)
Net cash transferred to restricted cash - (894)
Cash outflow from discontinued operations (907) (6,688)
Net cash flow from financing activities (193,058) (33,749)
(Decrease)/increase in cash and cash equivalents (3,770) 9,328
Cash and cash equivalents at beginning of year 9,486 158
Cash and cash equivalents at end of year 5,716 9,486
Consolidated Cash Flow Statement, Continued
For the year to 28 February 2015
2015£'000 2014£'000
(Decrease)/increase in cash and cash equivalents (3,770) 9,328
Cash and cash equivalents at beginning of year 9,486 158
Cash and cash equivalents at end of year 5,716 9,486
Restricted cash movements
Cash and cash equivalents at beginning of year 68,130 12,755
Proceeds from the sale of property, plant and equipment and investment property - 54,357
Repayment of borrowings (64,130) -
Interest paid - non-underlying (4,000) -
Interest received - 124
Net cash transferred from unrestricted cash - 894
(Decrease)/increase in cash and cash equivalents (68,130) 55,375
Restricted cash at end of year - 68,130
Total cash and cash equivalents at end of year, including Restricted cash 5,716 77,616
Cash - Continuing 5,716 78,850
Cash - Reclassified as held for sale - 11,797
Overdraft - Continuing - (4,522)
Overdraft - Reclassified as held for sale - (8,509)
Cash and cash equivalents at end of year, including Restricted cash 5,716 77,616
Notes to the Consolidated Financial Statements
For the year to 28 February 2015
Accounting Policies of Stobart Group Limited
Basis of preparation and statement of compliance
The financial information set out in this preliminary announcement is derived
from but does not constitute the Group's statutory accounts for the year ended
28 February 2015 and year ended 28 February 2014 and, as such, does not
contain all information required to be disclosed in the financial statements
prepared in accordance with International Financial Reporting Standards
("IFRS"). The financial information has been extracted from the Group's
audited consolidated statutory accounts upon which the auditors issued an
unqualified opinion.
The preliminary announcement has been prepared on the same basis as the
accounting policies set out in the previous year's financial statements.
The financial statements of the Group are also prepared in accordance with the
Companies (Guernsey) Law
2008.
Stobart Group Limited is a Guernsey registered company. The Company's ordinary
shares are traded on the
London Stock Exchange.
Going Concern
The Group's business activities, together with factors likely to affect its
future performance and position, are set out in the Chief Executive's
Statement and the financial position of the Group, its cash flows and funding
are set out in the Financial Review.
The Group has considerable financial resources, together with contracts with a
number of customers and suppliers. The financial forecasts show that the
Group's remaining borrowing facilities are adequate such that the Group can
operate within these facilities and meet its obligations when they fall due
for the foreseeable future.
After making enquiries, the Directors have a reasonable expectation that the
Group has adequate resources to continue in operational existence for the
foreseeable future. Accordingly, the financial statements have been prepared
on a going concern basis.
Presentation of Consolidated Income Statement
The presentation of the Consolidated Income Statement has been amended in
these financial statements to show the underlying results and non-underlying
results, including non-underlying items included in the Group's share of
profits of associates and joint ventures, in separate columns. These
non-underlying items are material incomes and expenses, which because of their
nature, infrequency or occurrence, or the events giving rise to them, merit
separate presentation to allow shareholders to better understand the financial
performance of the period. Underlying operating profit and underlying profit
before tax are non GAAP measures which comprise operating profit and profit
before tax respectively before non-underlying items. The columnar format is
considered to be the clearest method of presentation of this information.
Segmental information
As reported in May 2014 the Group has revised its internal reporting
structure. The new operating segments within continuing operations are Stobart
Energy, Stobart Aviation, Stobart Rail, Stobart Investments and Stobart
Infrastructure.
The reportable segment structure is determined by nature of operations and
services.
The Stobart Energy segment specialises in supply of sustainable biomass for
the generation of renewable energy.
The Stobart Aviation segment specialises in operation of commercial airports
and includes a joint venture investment in an airline.
The Stobart Rail segment specialises in delivering internal and external civil
engineering development projects including rail network operations.
The Stobart Investments segment holds non-controlling interests in a transport
and distribution business and an aircraft leasing business.
The Stobart Infrastructure segment specialises in management, development and
realisation of Group land and buildings assets as well as investments in
energy plants.
The Executive Directors are regarded as the Chief Operating Decision Maker
(CODM). The Directors monitor the results of each business unit separately
for the purposes of making decisions about resource allocation and performance
assessment. The main segmental profit measure is earnings before interest,
tax, depreciation, amortisation and internal rent and is shown before
non-underlying items.
Income taxes, finance costs and certain central costs are managed on a Group
basis and are not allocated to operating segments.
Year ended 28 February 2015 Energy Aviation Rail Investments Infrastructure Adjustments and eliminations Group
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Revenue
External 61,894 23,627 21,086 - 4,657 5,378 116,642
Internal 6,476 - 6,946 - 330 (13,752) -
Total revenue 68,370 23,627 28,032 - 4,987 (8,374) 116,642
Segment EBITDA before internal rent 7,765 1,439 2,826 6,792 4,032 (5,114) 17,740
Internal rent charge - (739) - - 739 - -
Segment EBITDA after internal rent 7,765 700 2,826 6,792 4,771 (5,114) 17,740
Segment PBT 6,567 (644) 1,205 6,792 1,576 (6,217) 9,279
New business and new contract set up costs (779)
Restructuring costs (1,685)
Amortisation of acquired intangibles (3,939)
Non-underlying finance costs (8,090)
Non-underlying items included in share of post-tax profits of associates and joint ventures (4,190)
Loss on continuing operations before tax (9,404)
Year ended 28 February 2014Restated Energy Aviation Rail Investments Infrastructure Adjustments and eliminations Group
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Revenue
External 53,169 20,342 15,579 - 7,468 2,621 99,179
Internal 5,281 - 13,208 - 1,622 (20,111) -
Total revenue 58,450 20,342 28,787 - 9,090 (17,490) 99,179
Segment EBITDA before internal rent 7,390 91 3,490 91 18,888 (7,329) 22,621
Internal rent charge - (21) - - 21 - -
Segment EBITDA after internal rent 7,390 70 3,490 91 18,909 (7,329) 22,621
Segment PBT 6,621 (979) 1,884 91 7,334 (9,562) 5,389
Transactions costs written off (480)
Restructuring costs (1,905)
Amortisation of acquired intangibles (221)
Impairment of property, plant and equipment (12,970)
Profit before tax (10,187)
No segmental assets or liabilities information is disclosed because no such
information is regularly provided to, or reviewed by, the Chief Operating
Decision Maker.
Inter-segment revenues are eliminated on consolidation.
Included in adjustments and eliminations are net central costs of £6,504,000
(2014: £9,020,000) and an intra-group loss of £287,000 (2014: profit
£542,000).There is also external income within adjustments and eliminations
which comprises brand licence income, merchandising income and income from
other business services.
Discontinued Operations
Partial Disposal of the Transport and Distribution Business
The Group disposed of a controlling interest in a substantial proportion of
the Transport and Distribution business on 10 April 2014. The Group has
retained a 49% interest in the business, which is accounted for as an
associate in the year. The environmental transport business unit, which was
previously part of the Transport and Distribution business, was also retained
and its results are reported in the Energy segment.
The results of the disposed business have been reported separately as a single
amount presented within discontinued operations. The operation represented a
separate major line of business.
The profit from discontinued operations of £6,850,000 (2014: £21,929,000) is
attributable to the owners of the Company, with the exception of £nil (2014:
£10,000) that is attributable to the minority interest. There was no loss
recorded on remeasurement to fair value less costs to sell.
The consideration received for disposal of the business was £239,700,000,
comprising of cash of £190,600,000, including £13,700,000 for the issue of a
licence premium, loan notes of £5,000,000, and fair value of the remaining 49%
of the business of £44,100,000. The fair value was based on an enterprise
value calculation taking into consideration the significant new debt within
the business. The loan notes were repaid on 24 April 2014. The profit on
disposal recorded within discontinued operations was £10,563,000 after
deducting fees and other costs directly related to the disposal.
The license premium is being amortised over six years, being the period over
which Eddie Stobart Logistics has the right to use the Eddie Stobart brand for
no additional consideration.
2015 2014
Results of discontinued operations £'000 £'000
Revenue 46,845 559,661
Operating expenses - other (49,696) (533,372)
Transaction costs - (391)
Restructuring costs - (3,221)
Amortisation of acquired intangibles (6) (76)
Net finance costs (14) (1,586)
Profit on partial disposal of business 10,563 -
Profit before tax 7,692 21,015
Tax (842) 914
Profit for the year from discontinued operations, net of tax 6,850 21,929
Basic earnings per share 2.08p 6.35p
Diluted earnings per share 2.08p 6.35p
2015 2014
Cash flows used in discontinued operations £'000 £'000
Net cash (used in)/from operating activities (16,669) 26,074
Net cash from investing activities 349 12,018
Net cash used in financing activities (907) (6,688)
Net cash flows for the year (17,227) 31,404
Underlying profit before tax of the Transport and Distribution business of
£25.3m in 2014 reflects the profit before tax of £21.0m plus the amortisation
of acquired intangibles of £0.1m plus the restructuring costs £3.2m plus the
transaction costs of £0.4m plus the loss before tax in respect of the chilled
pallet network business of £0.6m. The chilled pallet network business was
first reported as a discontinued operation in the financial statements for the
year to 28 February 2013 and represented a separate major line of business.
The above profit on partial disposal of business of £10,563,000 is calculated
as proceeds of £239,700,000 less costs of disposal of £8,642,000 less net
assets disposed of £220,495,000.
The revenue from one customer amounted to more than 10% of the Group's
discontinued revenue. The revenue from that customer reported within
discontinued operations was £14,547,000 for the year to 28 February 2015
(2014: £201,351,000).
The accounting for the Group's share of the results of the remaining 49% of
the business requires identification of the fair value of the investee's
identifiable assets and liabilities including intangible assets.
The share of the post tax results of the associate for the year of £2,200,000,
included in the Consolidated Income Statement total of £2,507,000, includes a
share of non-underlying items totalling a cost of £4,190,000.
Non-Underlying Items
Non-underlying items included in the consolidated income statement comprise
the items set out and described below.
2015 2014
£'000 £'000
Operating expenses - other
- New business and new contract set up costs 779 -
- Transaction costs - 480
- Restructuring costs 1,685 1,905
- Impairment of property, plant and equipment - 12,970
- Amortisation of acquired intangibles 3,939 221
6,403 15,576
Share of post-tax profits of associates and joint ventures
- Transaction costs 704 -
- Restructuring costs 886 -
- Amortisation of acquired intangibles 2,600 -
4,190 -
New business and new contract set up costs comprise costs of investing in
major new business areas or major new contracts to commence or accelerate
development of our business presence. These costs include marketing costs,
establishment costs, legal and professional fees, losses and certain staff and
training costs. The costs in the current year were in relation to the
development of business at London Southend Airport.
Transaction costs comprise costs of making investments or costs of financing
transactions that are not permitted to be debited to the cost of investment or
as issue costs. These costs include costs of any aborted transactions.
Restructuring costs comprise costs of integration plans and other business
reorganisation and restructuring undertaken by management. Costs include cost
rationalisation, brand harmonisation, site closure costs, certain short-term
duplicated costs, asset write downs and other costs related to the
reorganisation and integration of businesses. These are principally expected
to be one off in nature. The costs in the current year were principally in
relation to site restructuring in Stobart Energy and restructuring the
terminal security operations at London Southend Airport.
Impairment of property, plant and equipment charges are considered to be
non-recurring, due to their nature, and outside of the normal activities of
the Group.
Amortisation of acquired intangibles comprises the amortisation of intangible
assets including those identified as fair value adjustments in acquisition
accounting. The charge in the year is principally in connection with
amortisation of the brand assets.
Non-underlying items included in the share of post-tax profits of associates
and joint ventures all relate to the investment in Greenwhitestar Holding
Company 1 Limited. Transaction costs relate to the cost of the partial
disposal transaction, restructuring costs include costs of the restructuring
of the Automotive business and amortisation of acquired intangibles includes
amortisation of the customer relationships.
Non-underlying finance costs of £8,090,000, which are not included above,
comprise the costs associated with the early repayment of debt balances. Costs
include repayment fees, associated issue costs written off and directly
related professional fees. The costs in the year were incurred in connection
with the repayment of a £100,000,000 variable rate loan with M&G Investment
Management Limited and repayment of a substantial proportion of a property
loan with GE Real Estate Finance Limited.
Dividends
Dividends paid on ordinary shares 2015Rate 2015 2014Rate 2014
p £'000 p £'000
Interim dividend paid 5 December 2014 2.0 6,559 - -
Final dividend for 2014 paid 4 July 2014 4.0 13,249 - -
Interim dividend paid 6 December 2013 - - 2.0 6,952
Final dividend for 2013 paid 5 July 2013 - - 4.0 13,891
6.0 19,808 6.0 20,843
A final dividend of 4.0p per share totalling £13,117,033 was declared on 14
May 2015 and subject to shareholder approval will be paid on 3 July 2015. This
is not recognised as a liability as at 28 February 2015.
Of the £13,891,000 dividend in July 2013, £334,000 was settled by the issue of
shares under a scrip offer.
Financial assets and liabilities
2015 2014
£'000 £'000
Loans and borrowings
Non-current
Fixed rate:
- Obligations under finance leases and hire purchase contracts 6,045 10,009
- Bank loans - 69,828
Variable rate:- Obligations under finance leases and hire purchase contracts 11,452 -
- Bank loans - 96,844
17,497 176,681
Current
Fixed rate:
- Obligations under finance leases and hire purchase contracts 2,559 2,652
- Loan notes - 2,820
Variable rate:
- Obligations under finance lease and hire purchase contracts 4,723 -
- Overdrafts - 4,522
- Bank loans - 20,034
7,282 30,028
Total loans and borrowings 24,779 206,709
Cash 5,716 10,720
Restricted cash - 68,130
Net debt 19,063 127,859
The obligations under finance leases and hire purchase contracts are taken out
with various lenders at fixed or variable interest rates prevailing at the
inception of the contracts.
The bank loans at the prior year end included a £100,000,000 variable rate
group finance arrangement. This loan was fully repaid on 11 April 2014. Also
included in bank loans at the prior year end was a £74,864,000 property loan.
On 9 January 2015 the property loan was fully repaid. The bank loans at prior
year end also included £15,000,000 drawn on a £20,000,000 variable rate
committed revolving credit facility with a facility end date of February 2016.
This facility was fully repaid on 26 January 2015 and replaced with a new
£50,000,000 variable rate committed revolving credit facility with a facility
end date of January 2019. This £50,000,000 facility was fully undrawn at 28
February 2015.
Included in cash at the prior year end was £68,130,000 of 'Restricted cash'
held in an asset proceeds account and its use was restricted to reinvestment
in new property assets or repayment of the property loan. This Restricted cash
was used to repay a substantial proportion of the £74,864,000 property loan on
3 March 2014 and subsequently the remaining property loan was fully repaid on
9 January 2015.
The loan notes were issued in connection with the acquisition of Stobart
Biomass Products Limited on 19 May 2011. These loan notes were fully repaid on
5 March 2014.
Non-underlying finance costs of £8,090,000 (2014: £nil) includes the early
repayment fees payable in connection with the two substantial repayments set
out above as well as the write off of the debt issue costs carried in relation
to the repaid amounts.
The Group was in compliance with financial covenants throughout the year and
the previous year.
Note to the consolidated cash flow statement
Year to 28 February 2015 Year to 28 February 2014
£'000 £'000
Loss before tax from continuing operations (9,404) (10,187)
Adjustments to reconcile loss before tax to net cash flows:
Non-cash:
Gain in value of investment properties (1,292) (4,223)
Realised profit on sale of property, plant and equipment and investment properties (305) (7,397)
Share of post-tax profits of associates and joint ventures accounted for using the equity method (2,507) (460)
Loss on disposal of/loss in value of assets held for sale 67 1,020
Depreciation of property, plant and equipment 6,751 5,769
Impairment of assets - 12,970
Finance income (646) (635)
Interest expense 2,356 12,098
Finance costs - non-underlying 8,090 -
Release of grant income (277) (240)
Non-operating transaction costs - 480
Amortisation of intangibles 3,939 221
Share option charge 523 369
Working capital adjustments:
(Increase)/decrease in inventories (94) 529
(Increase)/decrease in trade and other receivables (14,493) 3,906
Increase/(decrease) in trade and other payables 13,124 (6,433)
Cash generated from continuing operations 5,832 7,787
Related Parties
Relationships of Common Control or Significant Influence
WA Developments International Limited is owned by WA Tinkler. During the year,
the Group paid rent of £nil (2014: £20,000) and levied recharges of £150,000
(2014: £119,000) relating to the recovery of staff costs and expenses to WA
Developments International Limited. £nil (2014: £48,000) was due from and £nil
(2014: £11,000) was due to WA Developments International Limited at the year
end.
Apollo Air Services Limited is owned by WA Tinkler. During the year, the Group
made purchases of £452,000 (2014: £407,000) relating to the provision of
passenger transport and sales of £17,000 (2014: £nil) relating to fuel to
Apollo Air Services Limited. £32,000 (2014: £29,000) was owed by the Group and
£2,000 (2014: £nil) was owed to the Group by this company at the year end.
The following disclosures relating to Ast Signs Limited and total emoluments
of close family members of W Stobart cover the period 1 March 2014 to 10 April
2014. This is the period during which W Stobart was an Executive Director of
Stobart Group Limited.
During the year the Group made purchases of £nil (2014: £254,000), relating to
the provision of branded products and vehicle advertising, from Ast Signs
Limited, a Company in which W Stobart holds a 27% shareholding.
During the year a number of close family members of WA Tinkler and W Stobart
were employed by the Group. The total emoluments of those close family
members, including benefits provided as part of their employment, amounted to
£48,000 (2014: £100,000).
Associates and Joint Ventures
Since the partial disposal of the Transport and Distribution business, there
have been a number of transactions with the group headed by Greenwhitestar
Holding Company 1 Limited, an associate interest, which owns Eddie Stobart
Logistics Limited. From the date of disposal to the year end, the Group made
sales of £7,298,000, mainly relating to cost recharges, (see below) and
purchases of £17,986,000, mainly relating to haulage costs and cost recharges
(see below). A balance of £1,254,000 was owed by the Group and £1,124,000 was
owed to the Group at the year end. These balances are shown within current
trade and other receivables / payables.
The Group and members of the group headed by Greenwhitestar Holding Company 1
Limited are operating under a transitional services agreement for a period
following the partial disposal. This agreement details recharges for shared
services; significant examples are time apportioned staff costs, truck and
trailer hire costs, property leases, office space rental charges, fuel and
car costs, IT hardware and software costs and payroll processing costs.
The Group had loans outstanding from its joint venture interest, Convoy
Limited of £nil (2014: £2,132,000) at the year end. This loan was fully repaid
during the year. This loan was accounted for an equity investment in
associates and joint ventures and the repayment in the year is part of the
distributions received in the reconciliation of investments.
The Group had loans, not part of the net investment, outstanding from
companies within the group headed by its joint venture interest, Everdeal
Holdings Limited, of £6,538,000 (2014: £782,000) at the year end. The loans
are unsecured, will be settled in cash and are due for repayment in September
2015 or at the Group's discretion. During the year, the Group made sales of
£1,828,000 (2014: £615,000) to a 100% subsidiary of Everdeal Holdings Limited.
A balance of £140,000 (2014: £202,000) was owed to the Group at the year end.
The interest receivable during the year was £37,000 (2014: £174,000) with both
balances disclosed as part of trade and other receivables.
The Group had loans, not part of the net investment, outstanding from its
associate interest, Shuban Power Limited, of £5,784,000 (2014: £4,281,000) at
the year end. This balance is disclosed within trade and other receivables in
non-current assets. The loans are unsecured, will be settled in cash and have
no fixed repayment date.
The Group had loans, not part of the net investment, outstanding from its
associate interest, Shuban 6 Limited, of £802,000 (2014: £802,000) at the year
end and is disclosed within trade and other receivables in non-current assets.
The interest outstanding at the year end was £22,000 (2014: £28,000) and is
disclosed within trade and other receivables. The loans are unsecured, will be
settled in cash and have no fixed repayment date.
The Group has loans, not part of the net investment, outstanding from its
associate interest, Mersey Bioenergy Holdings Limited, of £3,758,000 (2014:
£nil) at the year end. This balance is disclosed within trade and other
receivables in non-current assets. The loans are unsecured, have a ten year
term ending in November 2024 and will be settled in cash. During the year the
Group made sales of £2,200,000
(2014: £nil), relating to the sale of land, and purchases of £100,000 (2014:
£nil) from its associate interest, Mersey Bioenergy Holdings Limited, of which
£nil (2014: £nil) was outstanding at the year end.
All loans are unsecured and all sales and purchases are settled in cash on the
Group's standard commercial terms.
Post Balance Sheet Events
There were no events after the reporting period that are material for
disclosure in the financial statements.
This information is provided by RNS
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