REG - Billington Holdings - Interim Results <Origin Href="QuoteRef">BILN.L</Origin>

Billington HoldingsAnnouncement

19/09/2017 07:06

RNS Number : 0519R
Billington Holdings PLC
19 September 2017
19 September 2017
Billington Holdings
("Billington", "the Group" or "the Company")
Interim Results
Billington Holdings Plc (AIM: BILN), one of theUK's leading structural steel and construction safety solutions specialists, today announces its Interim Results for the six months ended 30 June 2017.
Unaudited six months to 30 June 2017
Unaudited six months to 30 June 2016
Percentage Movement
Revenue
34.29m
27.05m
26.8%
EBITDA
2.90m
2.36m
22.9%
Profit before tax
2.24m
1.74m
28.7%
Cash and cash equivalents
6.81m
6.24m
9.1%
Earnings per share from continuing operations
14.90p
11.70p
27.4%
Highlights:
 Group revenue and profit reflect positive trading environment
 Award of significant contracts post period end
 Good progress made at the Shafton site
 UK constructional steel consumption forecast to remain stable
 Strong forward order book - a busy second half of the year
Mark Smith, Chief Executive, commented:
"It is a pleasure to report a strong set of Interim Results, which have further improved from the 2016 results. This highlights the progressive performance across the Group delivering a diverse range of significant, high-quality contracts.
"The Company's growth strategy remains on track with progress continuing to be made at Shafton. The Group is beginning to realise the benefits of the increased in-house capacity.
"2017 is shaping up to be a very productive year, supported by the hard work of all divisions across the Group, and Billington expects an equally optimistic second half of the year."
For further information please contact:
Billington Holdings Plc Tel: 01226 340666
Mark Smith, Chief Executive 
Trevor Taylor, Finance Director
Blytheweigh Communications Limited  Tel: 020 7138 3204
Tim Blythe
Megan Ray 
Rachael Brooks
W H Ireland Limited   Tel: 0161 819 8875
Katy Mitchell
Ed Allsopp
Chief Executive Statement Introduction
2017 sees Billington celebrate its 70th anniversary and I am pleased to report that the Company has had a successful start to the year, which is expected to continue through to the end of 2017.
This has been an extremely busy period for the Group and I am delighted to deliver another positive setofinterimresults.
Progress has been made across the Group, especially at the Shafton site, where the Company's planned growth strategy remains on course. In addition, Billington continues to improve efficiencies in all Group companies which has, once again, led to incremental margin improvements.
Billington expects to replicate the success of this period during the second half of the year; a strong forward order book, which includes the significant contracts announced in August 2017, will contribute to this, and a positive start to 2018.
Businesses
Billington Structures
With sites in Barnsley and Bristol, Billington Structures designs, fabricates and erects structural steel across all sectors of the UK market. It is a nationally recognised and award-winning steelwork contractor with 70 years' experience, and has the capacity to process over 25,000 tonnes of steel per annum.
The company has had a strong six months which saw Billington Structures shift its focus to a smaller number of more significant projects. In addition, a number of these contracts outperformed against initial tender allowances, resulting in improved profits.
Projects carried out during the period include IKEA, Sheffield; Commercial Offices at Lombard Street, London; Project Beagle, Birmingham; and 3 Wellington Place, Leeds; along with various data centres across the country. After successfully completing buildings 3, 5 & 6 of Wellington Place, Billington has recently secured another two projects on the development. 
BillingtonStructuresisexpectedtohaveanequallybusysecondhalfoftheyearwithvariousprojects in the pipeline, including a large distribution centre for a national retailer, where a proportion of the work will carry through to2018.
Shafton Steel Services
ThelargeShaftonsite,locatedfivemilesfromBillington'sHeadOfficeinBarnsley,housesstate-of-the-art steel processing and profiling facilities. It offers an extensive range of services to UK and overseas engineering and fabrication markets, and was purchased as part of the Group's growthstrategy.
Following the vacation of tenants in April 2017, adaptations to the site have been ongoing and will continue to the end of the year. The next phase of capital expenditure has been authorised, including new machinery which will increase the processing and fabrication capacity at the site and allow new work streams to be carried out. Installation of the machines will be completed by the year end, and will be fully operational by January 2018.
The Shafton facility offers the opportunity to bring previously subcontracted work back in-house, and also provides increased capacity for Billington Structures.
During the period, Shafton's workforce increased by 41 per cent in order to manage the growth and additional workload at the division, and the company intends to continue further recruitment throughout the remainder of the year. 
2017isthesecondyearofBillington'sfiveyeardevelopmentandadaptationplanforShafton, which remains ontrack.
Tubecon
Tubecon, a trading division of Billington Structures, is a specialist in Architecturally Exposed Structural Steelwork (AESS) operating primarily in the UK construction and rail infrastructure markets.
One of the recently completed projects, TheHurlinghamClubRacquetCentre, is anextremelycomplexcurvedroofstructure that has been shortlistedfor the Structural Steel Design Awards. The winners of this award are to be announced later thisyear.
Peter Marshall Steel Stairs
Peter Marshall Steel Stairs is a specialist company engaged in the design, fabrication and installation of highly engineered steelwork, staircases and balustrade systems.
The first half of 2017 has been a successful period for the company, and it has been working on a number of projects, including Westfield Shopping Centre, London; Romford Leisure Centre, Romford; and Redrock, Stockport.PeterMarshallSteelStairsis alsoexpectingabusysecondhalf of the year, withanumberoflarge projects in the pipeline, continuing into2018.
easi-edge
easi-edge is a leading safety solutions provider that primarily supplies perimeter edge protection and fall prevention systems to the Main Contractor and Fabricator markets.
The company has had a solid six months and has further developed it hire fleet to provide an optimum product for its customers. The fabrication and production of the enhanced barrier fleet will commence as utilisation levels dictate.
hoard-it
hoard-it,whichprovidesreusableandeco-friendlysitehoardingsolutionsonahireandsalebasis,has had a pleasing start to theyear.
The company welcomes a new General Manager, who will continue to drive the growth of hoard-it, which is expected to have an active second half of the year following the award of several large contracts.
Results
Revenue and Profit Before Tax
Group revenue and profit before tax both increased over the period. Revenue increased by 26.8 per cent to 34.29 million, whilst profit increased by 28.7 per cent to 2.24 million. These increases have been driven by the success of Billington Structures during the period, along with a strong performance from all other companies.
The Group expects a similar performance during the second half of the year, supported by a busy order book and a number of large contracts in the pipeline.
Group Operating Profit
The Group operating profit for the period was 2.27 million compared to 1.77 million for the same period in 2016. The Group operating profit margin remained stable at 6.6 per cent. This was due to theamountofworkcarriedoutbytheGroup,continuedimprovementsinoperationalefficienciesand the outperformance of several contracts against anticipatedprojections.
Earnings per Share
Earnings per share from continued operations stood at 14.90 pence in the period, compared with earnings per share of 11.70 pence for the corresponding period in 2016.
Liquidity and Capital Resources
Billington's cash and cash equivalents increased to 6.81 million during the period (2016: 6.24 million).Thisincreasehasbeenachieveddespitethepaymentduringtheperiodofadividendof1.21 million along with capital expenditure primarily relating to the Shaftonsite.
The positive cash position of the Group provides Billington with confidence as it moves into a busy second half. In addition, its solid balance sheet adequately supports the Company's working capital requirements and planned growth strategy.
Dividend
Asaresultofcontinuingpositiveperformance,Billingtondeclaredadividendof10.00pencepershare following the 2016 full year results, and this was duly paid in the period. The dividend of 10.00 pence per share represented a significant increase from the previous year (2016: 6.00pence).
The dividend has been set at a level that recognises the need to reward shareholders, as well as the anticipated funding requirements in relation to the future development of the Company.
Awards
During the period, several projects across the Group were shortlisted for various awards, including RAF Brize Norton and the Hurlingham Club Racquet Centre, which are both shortlisted in the Structural Steel Design Awards (results due 4 October). Additionally, Project Beagle won the Public Vote in the UK Tekla Awards.
Board and Employees
Billington continues to acknowledge the skills shortage within the industry and has therefore adopted
various strategies to combat the impact of this on the Group's operations.
The Company invests in the training and development of its employees, runs apprenticeship programmes and supports local colleges; all of which help to ensure Billington maintains a skilled workforce.
Prospects and Outlook
A year on from the Brexit vote, and the market appears to be in a stable position, with UK consumption of constructionalsteelforecasttoremainconsistentinto2020.ThisstabilityprovidesBillingtonwiththe confidence to continue its growth strategy, and the ability to meet demands and complete projects to the highest standard. As stated in the 2016 Financial Statements, Brexit has also allowed theCompanytoexploreopportunitiesinEurope,whichremainsanongoingpropositionfortheGroup.
Billington's growth strategy, which intends to increase capacity and enable the Group to conduct additional work streams, remains on track. The Shafton facility has been a positive acquisition for the Group and is continuing to provide benefits to the Company.
During the period, a tenant at the Shafton site went into administration but despite the loss of rental income, this provides Billington with the opportunity to assess how to best utilise the vacant property and review potential future options for the Group.
The start of 2017 has been a busy period for Billington. The Company is seeing a consistent rate and quality of enquires which are expected to continue. The Group has a strong forward order book and the second half of the year looks to be equally as busy as the first.
Finally, I would like to thank Billington's Board, employees, shareholders and stakeholders for their continued support, and I look forward to a busy and prosperous second half of the year.
Mark Smith Chief Executive
19 September 2017
Condensed consolidated interim income statement
Six months ended 30 June 2017
Unaudited
Unaudited
Audited
Six months
Six months
Twelve months
to 30 June
to 30 June
to 31 December
2017
2016
2016
'000
'000
'000
Continuing operations
Revenue, excluding movements in work in progress 
34,686 
30,008 
64,291 
Decrease in work in progress
(397)
(2,962)
(957)
Revenue
34,289 
27,046 
63,334 
Raw material and consumables
21,664 
15,957 
39,470 
Other external charges
2,242 
1,926 
4,208 
Staff costs
6,871 
6,083 
12,903 
Depreciation
635 
592 
1,254 
Other operating charges
610 
719 
1,674 
32,022 
25,277 
59,509 
Group operating profit
2,267 
1,769 
3,825 
Share of post tax profit in joint ventures
- 
- 
- 
Total operating profit
2,267 
1,769 
3,825 
Net finance expense
(24)
(31)
(22)
Profit before tax
2,243 
1,738 
3,803 
Tax
(448)
(378)
(832)
Profit for the period from continuing operations and attributable to equity holders of the parent company
1,795 
1,360 
2,971 
Earnings per share (basic and diluted) from continuing operations
14.9 p 
11.7 p 
25.4 p 
Dividends per share
10.00 p 
6.00 p 
6.00 p 
Earnings per ordinary share has been calculated on the basis of the result for the period after tax, divided by the weighted average number of ordinary shares in issue in the period, excluding those held in the ESOP Trust, of 12,048,408. The comparatives are calculated by reference to the weighted average number of ordinary shares in issue which were 11,603,836 for the period to 30 June 2016 and 11,715,526 for the year ended 31 December 2016.
Condensed consolidated interim balance sheet
As at 30 June 2017
Unaudited
Unaudited
Audited
30 June
30 June
31December
2017
2016
2016
'000
'000
'000
Assets
Non current assets
Property, plant and equipment
13,230 
13,089 
13,148 
Pension asset
1,146 
968 
1,146 
Investment in joint ventures
- 
- 
- 
Deferred tax asset
27 
38 
27 
Total non current assets
14,403 
14,095 
14,321 
Current assets
Inventories and work in progress
9,374 
7,663 
9,865 
Trade and other receivables
7,970 
6,747 
5,581 
Cash and cash equivalents
6,812 
6,242 
6,033 
Total current assets
24,156 
20,652 
21,479 
Total assets
38,559 
34,747 
35,800 
Liabilities
Current liabilities
Current portion of long term borrowings
218 
267 
487 
Trade and other payables
16,262 
14,774 
13,940 
Current tax payable
565 
379 
569 
Total current liabilities
17,045 
15,420 
14,996 
Non current liabilities
Long term borrowings
2,125 
2,375 
2,005 
Total non current liabilities
2,125 
2,375 
2,005 
Total liabilities
19,170 
17,795 
17,001 
Net assets
19,389 
16,952 
18,799 
Equity
Share capital
1,293 
1,293 
1,293 
Share premium
1,864 
1,864 
1,864 
Capital redemption reserve
132 
132 
132 
Other reserve
(825)
(904)
(825)
Accumulated profits
16,925 
14,567 
16,335 
Total equity
19,389 
16,952 
18,799 
Condensed consolidated interim statement of changes in equity
(Unaudited)
Share
Share 
Capital
Other 
Accumulated
Total 
capital
premium
redemption
reserve - 
profits
equity
account
reserve
ESOP
'000
'000
'000
'000
'000
'000
At 1 January 2016
1,293 
1,864 
132 
(904)
13,983 
16,368 
Equity dividends declared
- 
- 
- 
- 
(776)
(776)
Transactions with owners
- 
- 
- 
- 
(776)
(776)
Profit for the six months to 30 June 2016
- 
- 
- 
- 
1,360 
1,360 
Total comprehensive income for the period
- 
- 
- 
- 
1,360 
1,360 
At 30 June 2016
1,293 
1,864 
132 
(904)
14,567 
16,952 
At 1 July 2016
1,293 
1,864 
132 
(904)
14,567 
16,952 
Equity dividends paid to ESOP 
- 
- 
- 
- 
38 
38 
Credit related to equity-settled share based payments
- 
- 
- 
- 
71 
71 
ESOP movement in period
- 
- 
- 
79 
- 
79 
Transactions with owners
- 
- 
- 
79 
109 
188 
Profit for the six months to 31 December 2016
- 
- 
- 
- 
1,611 
1,611 
Other comprehensive income
Actuarial gain recognised in the pension scheme
- 
- 
- 
- 
17 
17 
Income tax relating to components of other comprehensive income
- 
- 
- 
- 
31 
31 
Total comprehensive income for the period
- 
- 
- 
- 
1,659 
1,659 
At 31 December 2016
1,293 
1,864 
132 
(825)
16,335 
18,799 
At 1 January 2017
1,293 
1,864 
132 
(825)
16,335 
18,799 
Equity dividends declared
- 
- 
- 
- 
(1,205)
(1,205)
Transactions with owners
- 
- 
- 
- 
(1,205)
(1,205)
Profit for the six months to 30 June 2017
- 
- 
- 
- 
1,795 
1,795 
Total comprehensive income for the period
- 
- 
- 
- 
1,795 
1,795 
At 30 June 2017
1,293 
1,864 
132 
(825)
16,925 
19,389 
Condensed consolidated interim statement of comprehensive income
Six months ended 30 June 2017
Unaudited
Unaudited
Audited
Six months
Six months
Twelve months
to 30 June
to 30 June
to 31 December
2017
2016
2016
'000
'000
'000
Profit for the period
1,795 
1,360 
2,971 
Other comprehensive income
Remeasurement of net defined benefit surplus
- 
- 
17 
Movement on deferred tax relating to pension liability 
- 
- 
(1)
Current tax relating to pension liability 
- 
- 
32 
Other comprehensive income, net of tax
- 
- 
48 
Total comprehensive income for the period attributable to equity holders of the parent company
1,795 
1,360 
3,019 
Condensed consolidated interim cash flow statement
Six months ended 30th June 2017
Unaudited
Unaudited
Audited
Six months
Six months
Twelve months
to 30 June
to 30 June
to31December
2017
2016
2016
'000
'000
'000
Cash flows from operating activities
Group profit after tax
1,795 
1,360 
2,971 
Taxation paid
(452)
(156)
(376)
Depreciation on property, plant and equipment
635 
592 
1,254 
Difference between pension charge and cash contributions
(31)
(61)
(123)
Share based payment charge
- 
- 
71 
Profit on sale of property, plant and equipment
(79)
(117)
(228)
Taxation charge recognised in income statement
448 
378 
832 
Net finance expense
24 
31 
22 
Decrease in inventories and work in progress
491 
2,905 
703 
Increase in trade and other receivables
(2,358)
(1,371)
(266)
Increase in trade and other payables
2,322 
1,430 
596 
Net cash flow from operating activities
2,795 
4,991 
5,456 
Cash flows from investing activities
Purchase of property, plant and equipment
(753)
(535)
(1,277)
Proceeds from sale of property, plant and equipment
115 
133 
263 
Net cash flow from investing activities
(638)
(402)
(1,014)
Cash flows from financing activities
Interest paid
(24)
(31)
(60)
Repayment of bank and other loans
(149)
(151)
(301)
Equity dividends paid
(1,205)
(776)
(738)
Employee Share Ownership Plan share purchases
- 
- 
(37)
Employee Share Ownership Plan share sales
- 
- 
116 
Net cash flow from financing activities
(1,378)
(958)
(1,020)
Net increase in cash and cash equivalents
779 
3,631 
3,422 
Cash and cash equivalents at beginning of period
6,033 
2,611 
2,611 
Cash and cash equivalents at end of period
6,812 
6,242 
6,033 
Notes to the interim accounts - as at 30 June 2017
Segmental Reporting
The Group trading operations of Billington Holdings plc are only in Structural Steel, and all are continuing. This includes the activities of Billington Structures Limited, easi-edge Limited, Peter Marshall Steel Stairs Limited and hoard-it Limited. The Group activities, comprising services and assets provided to Group companies and a small element of external property rentals and management charges, are considered incidental to the activities of Billington Structures Limited and have therefore not been shown as a separate operating segment but have been subsumed within Structural Steel. All assets of the Group reside in the UK.
Basis of preparation
These consolidated interim financial statements are for the six months ended 30 June 2017. They have been prepared with regard to the requirements of IFRS. The financial information set out in these consolidated interim financial statements does not constitute statutory accounts as defined in S434 of the Companies Act 2006. They do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements of the Group for the year ended 31 December 2016 which contained an unqualified audit report and have been filed with the Registrar of Companies. They did not contain statements under S498 of the Companies Act 2006.
These consolidated interim financial statements have been prepared under the historical cost convention. The accounting policies have been applied consistently throughout the Group for the purposes of preparation of these consolidated interim financial statements.  
Dividends
In the first half of 2017 Billington Holdings Plc declared a final dividend of 10.0 pence per share amounting to 1,205,000 (2016: 6.0 pence, 776,000) to its equity shareholders. No interim dividend for 2017 has been declared (2016: nil).
These results were approved by the Board of Directors on 18 September 2017.

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