REG - Carr's Group PLC - Half-year Report <Origin Href="QuoteRef">CARRC.L</Origin> - Part 2
11/04/2016 07:05
- Part 2: For the preceding part double click ID:nRSK6935Ua
income 154
Finance costs (717)
9,025
Share of post-tax profit of associate 904
Share of post-tax profit of joint ventures 682
Profit before taxation 10,611
Segment gross assets 114,462 48,703 33,829 196,994
Other and consolidation adjustments 10,663
Total gross assets 207,657
² Net interest on the net defined benefit retirement asset previously included
within the IAS19 income statement (credit)/charge in operating profit has been
reclassified to interest income.
Agriculture Food Engineering Group
£'000 £'000 £'000 £'000
52 weeks ended 29 August 2015 (restated)²
Total segment revenue 297,858 80,280 33,588 411,726
Inter segment revenue (115) - (46) (161)
Revenue from external customers 297,743 80,280 33,542 411,565
EBITDA¹ 12,907 4,713 3,875 21,495
Depreciation of property, plant and equipment (2,384) (1,860) (815) (5,059)
Depreciation of investment property (6) (14) - (20)
Profit/(loss) on the disposal of property, plant and equipment 38 12 (24) 26
Amortisation of intangible assets (100) (15) (93) (208)
Operating profit 10,455 2,836 2,943 16,234
Finance income 338
Finance costs (1,412)
15,160
Share of post-tax profit of associate 1,500
Share of post-tax profit of joint ventures 807
Profit before taxation 17,467
Segment gross assets 112,038 48,412 33,991 194,441
Other and consolidation adjustments 8,947
Total gross assets 203,388
7. Earnings per share
Non-recurring items and amortisation that are charged or credited to profit do
not relate to the profitability of the Group on an ongoing basis. Therefore
an adjusted earnings per share is presented as follows:
26 weeksended 27 February 2016 26 weeks ended 28 February 2015 52 weeksended29 August2015
£'000 £'000 £'000
Earnings 7,990 7,626 11,989
Amortisation and non-recurring items:
Amortisation of intangible assets 90 107 208
Tax relief on amortisation (21) (26) (52)
Acquisition related costs¹ - 35 58
Earnings - adjusted 8,059 7,742 12,203
¹ Disallowable for tax purposes
Number Number Number
Weighted average number of ordinary shares in issue 89,819,777 89,433,051 89,574,461
Potentially dilutive share options 3,468,339 3,306,934 3,098,077
93,288,116 92,739,985 92,672,538
Earnings per share (pence)
Basic 8.9p 8.5p 13.4p
Diluted 8.6p 8.2p 12.9p
Adjusted 9.0p 8.7p 13.6p
Diluted adjusted 8.6p 8.3p 13.2p
8. Dividends
An interim dividend of £830,281 that relates to the period to 29 August 2015
was paid on 9 October 2015, and a final dividend of £1,662,111 was paid on 15
January 2016.
In addition, an interim dividend of 0.95p per share (2015: 0.925p per share)
has been approved by the Directors. It is payable to shareholders on the
register at 22 April 2016. This interim dividend, amounting to £854,968
(2015: £829,726), has not been recognised as a liability in this interim
financial information. It will be recognised in shareholders' equity in the
53 weeks to 3 September 2016.
9. Intangible assets, property, plant and equipment and investment
property
Goodwill OtherIntangible assets Property,plant and equipment Investment property
£'000 £'000 £'000 £'000
26 weeks ended 27 February 2016
Opening net book amount at 30 August 2015 10,849 448 58,385 636
Exchange differences 2 18 862 -
Business acquired 80 - 23 -
Additions - 37 3,867 -
Disposals - - (98) -
Depreciation and amortisation - (90) (2,648) (10)
Closing net book amount at 27 February 2016 10,931 413 60,391 626
26 weeks ended 28 February 2015
Opening net book amount at 31 August 2014 9,798 499 56,626 656
Exchange differences 2 (22) (322) -
Subsidiaries acquired 240 81 139 -
Additions - 3 2,941 -
Disposals - - (229) -
Depreciation and amortisation - (107) (2,526) (10)
Closing net book amount as at 28 February 2015 10,040 454 56,629 646
Capital commitments contracted, but not provided for, by the Group at the
period end amounts to £758,000 (2015: £1,412,000).
10. Borrowings and loans
As at27 February 2016 As at 28 February 2015 As at 29 August2015
£'000 £'000 £'000
Current 10,286 16,079 15,157
Non-current 25,447 27,876 25,744
Total borrowings and loans 35,733 43,955 40,901
Cash and cash equivalents (8,719) (17,943) (16,488)
Net debt 27,014 26,012 24,413
Undrawn facilities 26,805 19,386 19,007
Movements in borrowings are analysed as follows:
26 weeks ended 27 February 2016 £'000
Opening amount as at 30 August 2015 40,901
Exchange differences 67
New bank loans and finance leases 718
Finance lease principal repayments (1,160)
Repayments of borrowings (544)
Decrease in other borrowings (4,438)
Release of deferred borrowing costs 18
Net increase to bank overdraft 171
Closing amount as at 27 February 2016 35,733
10. Borrowings and loans (continued)
26 weeks ended 28 February 2015 £'000
Opening amount as at 31 August 2014 41,877
New bank loans and finance leases 8,541
Finance lease principal repayments (1,171)
Repayments of borrowings (4,198)
Decrease in other borrowings (1,171)
Release of deferred borrowing costs 16
Net increase to bank overdraft 61
Closing amount as at 28 February 2015 43,955
11. Financial instruments
IFRS13 requires financial instruments that are measured at fair value to be
classified according to the valuation technique used:
Level 1 - quoted prices (unadjusted) in active markets for identical assets or
liabilities
Level 2 - inputs, other than Level 1 inputs, that are observable for the asset
or liability, either
directly (i.e., as prices) or indirectly (i.e., derived from prices)
Level 3 - unobservable inputs
All derivative financial instruments are measured at fair value using Level 2
inputs. The Group's bankers provide the valuations for the derivative
financial instruments at each reporting period end based on mark to market
valuation techniques.
The Group holds shares in several private limited companies. These have been
classified as unquoted investments for which fair value cannot be reliably
measured and are held at cost less accumulated impairment. Had fair value
been applied this financial asset would have been Level 3.
Transfers between levels are deemed to have occurred at the end of the
reporting period. There were no transfers between levels in the above
hierarchy in the period.
With the exception of those detailed above, the Group's financial instruments
are measured at amortised cost.
12. Retirement benefit asset
The amounts recognised within the Income Statement were as follows:
26 weeks ended 27 February 2016 26 weeks ended 28 February 2015 52 weeksended29 August2015
£'000 £'000 £'000
Service cost - including current service costs, past service costs and settlements (427) 149 31
Service cost - administrative cost 80 153 230
Net interest on the net defined benefit asset (46) (54) (141)
(393) 248 120
As a result of the closure to future accrual on 31 December 2015 a negative
past service cost, net of associated costs, of approximately £350,000 has been
recognised in the income statement.
12. Retirement benefit asset (continued)
Net interest on the defined benefit retirement asset is recognised within
interest income.
The amounts recognised in the Balance Sheet were as follows:
As at27 February2016 As at 28 February 2015 As at 29 August 2015
£'000 £'000 £'000
Present value of funded defined benefit obligations (59,040) (66,136) (60,352)
Fair value of scheme assets 62,967 67,334 62,119
Surplus in the balance sheet 3,927 1,198 1,767
Actuarial gains of £879,000 (2015: losses of £1,959,000) have been reported in
the Statement of Comprehensive Income. The surplus has increased over the
period since 29 August 2015. The main reasons for this include the
contributions paid by the employer to meet the funding deficit and the
cessation to future accrual from 31 December 2015.
The Group's associate's defined benefit pension scheme is closed to future
service accrual and the valuation for this scheme has not been updated for the
half year as any actuarial movements are not considered to be material.
13. Share capital
Allotted and fully paid ordinary shares of 2.5p each Number of shares Share capital £'000 Sharepremium £'000 Total
£'000
Opening balance as at 30 August 2015 89,760,090 2,244 8,615 10,859
Proceeds from shares issued:
- share option scheme 60,000 1 27 28
- share save scheme 26,584 1 15 16
At 27 February 2016 89,846,674 2,246 8,657 10,903
Opening balance at 31 August 2014 89,401,900 2,235 8,453 10,688
Proceeds from shares issued:
- share option scheme 90,000 2 41 43
- share save scheme 8,190 - 4 4
At 28 February 2015 89,500,090 2,237 8,498 10,735
Employee share schemes: options exercised during the period to 27 February
2016 resulted in 26,584 shares being issued (2015: 8,190 shares), with
exercise proceeds of £15,765 (2015: £4,685) under the share save scheme and
60,000 shares being issued (2015: 90,000 shares), with exercise proceeds of
£28,560 (2015: £42,840) under the approved share option scheme. The related
weighted average price of the shares exercised was £0.593 (2015: £0.572) per
share and £0.476 (2015: £0.476) respectively.
Since the period end there was a further allotment of 150,000 shares with a
nominal value of £3,750 due to the exercise of share options.
14. Acquisition
On 4 September 2015 Carrs Billington Agriculture (Sales) Limited acquired the
business and certain assets of Green (Agriculture) Co, an agricultural
merchant, for net cash consideration of £0.3m.
The primary reason for the business combination was the expansion of the
existing Agriculture business.
Goodwill represented the excess of the consideration paid over the Group's
interest in the net fair value of the identifiable assets, liabilities and
contingent liabilities acquired.
Following a review of the acquisition for separately identifiable intangible
assets where fair value can be reliably measured the Directors do not consider
there to be any material intangible assets requiring recognition.
Revenue of £428,000 and profit before taxation of £4,000 has been generated
since the date of acquisition.
There were no external acquisition related costs to be recognised in the
consolidated income statement.
The assets recognised in the acquisition accounting are set out below:
Fair value
£'000
Property, plant and equipment 23
Inventories 112
Receivables 50
Assets acquired 185
Goodwill 80
265
Satisfied by:
Cash consideration 265
Had the acquisition of Green (Agriculture) Co occurred at the beginning of the
accounting period the Group's revenue and profit before taxation for the
period would not be materially different to the amounts actually recognised in
the consolidated income statement.
15. Cash generated from operations
(Restated)¹ (Restated)¹
26 weeks ended 27 February 2016 26 weeks ended 28 February 2015 52 weeksended29 August2015
£'000 £'000 £'000
Profit for the period from operations 8,741 8,403 13,693
Adjustments for:
Tax 1,778 2,208 3,774
Tax credit in respect of R&D (96) (489) (623)
Depreciation of property, plant and equipment 2,648 2,526 5,059
Depreciation of investment property 10 10 20
Intangible asset amortisation 90 107 208
Profit on disposal of property, plant and equipment (80) (35) (26)
Loss on disposal of investment 10 - -
Amortisation of grants (74) (130) (120)
Net fair value loss on share based payments 247 295 584
Net foreign exchange differences (180) (54) 53
Net fair value losses/(gains) on derivative financial instruments in operating profit 108 (50) 7
Finance costs:
Interest income (119) (154) (338)
Interest expense and borrowing costs 680 733 1,445
Share of profit from associate and joint ventures (1,423) (1,586) (2,307)
Pension contributions - deficit reduction (780) (1,170) (2,340)
- ongoing (108) (179) (339)
IAS19 income statement (credit)/charge (excluding interest) (347) 302 261
Changes in working capital (excluding the effects of acquisitions):
Increase in inventories (3,970) (3,418) (967)
(Increase)/decrease in receivables (8,015) (4,168) 320
Increase/(decrease) in payables 2,836 3,217 (3,237)
Cash generated from operations 1,956 6,368 15,127
¹ Net interest on the net defined benefit retirement asset previously included
within the IAS19 income statement (credit)/charge has been reclassified to
interest income.
16. Related party transactions
The Group's significant related parties are its associate and joint ventures,
as disclosed in the Annual Report and Accounts 2015.
Transactions and balances with the associate and joint ventures were all
undertaken on an arm's length basis in the normal course of business and are
as follows:
Sales to Purchases from Rent receivable from Net management charges (to)/from Amounts owed from Amounts owed to
£'000 £'000 £'000 £'000 £'000 £'000
26 weeks to 27 February 2016
Associate 327 (44,977) 9 (57) 616 (21,050)
Joint ventures 186 (661) - 84 1,952 (48)
26 weeks to 28 February 2015
Associate 550 (48,279) 9 (14) 1,221 (17,369)
Joint ventures 72 (592) - 63 3,668 (39)
This information is provided by RNS
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