REG - Thorpe(F.W.) PLC - Half Yearly Report <Origin Href="QuoteRef">TFW.L</Origin>

FW ThorpeAnnouncement

19/03/2015 07:00

RNS Number : 8376H
Thorpe(F.W.) PLC
19 March 2015
F W Thorpe Plc
INTERIM RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2014
Key highlights (continuing operations):

Interim
2015
Interim
2014

Revenue
32.6m
29.6m
10% increase
Operating profit
5.5m
5.1m
8% increase
Profit before tax
5.8m
5.4m
7% increase
Basic earnings per share
3.92p
3.59p
9% increase
Growth in LED product sales continues, now 58% of revenue
Sugg Lighting disposal effective 6 February 2015
TRT Lighting profitable year to date
Continued investment in manufacturing facilities
Interim dividend increased to 1.10p (Interim 2014: 1.05p) - 5% increase
For further information please contact: 
F W Thorpe Plc
Andrew Thorpe - Chairman and Joint Chief Executive
01527 583200
Craig Muncaster - Financial Director
01527 583200
N+1 Singer - Nominated Adviser
Richard Lindley
0113 388 4789


CHAIRMAN'S INTERIM STATEMENT
The half year to 31 December 2014 produced revenues up 10% with an increase in operating profit of 8% from continuing operations resulting, after taking into account investment income and taxation, in an increase of earnings per share of 9%.
These figures reflect your company's success in achieving a continued upward trajectory in its activities with most subsidiaries performing well and building further on the strengthened foundations put in place in recent years in regards to sales penetration capacity and the upgrading of product ranges.
Forward momentum has, however, continued to prove difficult at one subsidiary, its products being "retro" in nature and at odds with the company's forward-looking philosophy. I must, therefore, report that Sugg Lighting was sold for a nominal consideration on 6 February 2015 and is no longer part of your group. Sugg Lighting has been purchased by a company specialising in traditional English heritage brands.
This sale should hold advantage for Sugg Lighting and allow your own company's directors to devote more time to future projects.
LED products now represent around 58% of group revenues but Thorlux Lighting, in particular, still suffers from the parallel demand for substantial quantities of "old technology" products. Measured and careful steps are being taken to withdraw these older products where possible without disruption to customer sentiment or causing stock obsolescence.
Investment has continued on funding growth rather than start-up costs at street and road tunnel lighting company TRT Lighting, the completion of the now occupied new factory for Solite Europe, costing 1.4m, and the installation of the second new LED circuit board line at Thorlux. This latter investment increases board assembly capacity by 100%, notwithstanding the ability to make larger more cost effective units.
On a more sombre note it is with regret that I must, at this time, report the death of ex-Chairman, Mr Ernest Thorpe, aged 97. "EGT" as he was known was a co-founder of F W Thorpe Plc and devoted in excess of 55 years' service broken only by such necessary requirements as his participation in the Second World War. We hope his light shines on elsewhere.
Group performance outlined at the beginning of this report allows your company to pay a dividend for the half year to 31 December 2014 of 1.10p per share (Interim 2014: 1.05p), an increase of 5%.
Andrew Thorpe
Chairman
19 March 2015 
F W Thorpe Plc


CONSOLIDATED INCOME STATEMENT 
for the six months to 31 December 2014

Six months to
Six monthsto
Twelve months to
Continuing Operations
31.12.14
31.12.13
30.06.14





(unaudited)
(restated unaudited)
(restated unaudited)





'000
'000
'000




Revenue
32,629
29,584
61,352




Operating Profit
5,510
5,096
11,752




Finance income
315
322
763
Share of (loss)/profit of joint venture
(4)
-
37








Profit before tax expense
5,821
5,418
12,552




Tax expense
(1,283)
(1,216)
(2,233)




Profit for the period from continuing operations
4,538
4,202
10,319
Loss for the period from discontinued operations
(104)
(4)
(130)
Loss on disposal of subsidiary
(120)
-
-




Profit for the period
4,314
4,198
10,189




Dividend rate per share:



 Interim
1.10p
1.05p
1.05p
 Final
-
-
2.20p
 Special
-
-
1.50p
Earnings per share
- basic
3.92p
3.59p
8.72p
(continuing operations)
- diluted
3.90p
3.59p
8.72p
Earnings per share
- basic
3.73p
3.59p
8.72p

- diluted
3.71p
3.59p
8.72p
GROUP STATEMENT OF COMPREHENSIVE INCOME
for the six months to 31 December 2014

Six months to
Six monthsto
Twelve months to

31.12.14
31.12.13
30.06.14





(unaudited)
(unaudited)
(audited)





'000
'000
'000








Profit for the year
4,314
4,198
10,189




Other comprehensive income







Items that may be reclassified to profit or loss







 - Arising in period
(46)
201
276




 - Reclassified in period
-
-
-




Exchange rate movement on investment in joint venture







 - Arising in period
(3)
(2)
(2)




 - Reclassified in period
-
-
-




Taxation
9
-
72





(40)
199
346








Items that will not be reclassified to profit or loss







Actuarial gain on pension scheme
-
-
624




Movement on unrecognised pension surplus
-
-
(1,216)





-
-
(592)




Other comprehensive income for the year, net of tax
(40)
199
(246)












Total comprehensive income for the year 
4,274
4,397
9,943




All comprehensive income is attributable to the owners of the company.


CONSOLIDATED BALANCE SHEET 
as at 31 December 2014

As at
As at
As at 

31.12.14
31.12.13
30.06.14





(unaudited)
(unaudited)
(audited)
Assets
'000
'000
'000
Non-Current Assets



Property, plant and equipment
13,190
12,495
13,088
Intangible assets
6,678
6,550
6,722
Investment property
2,135
2,102
2,135
Loans and receivables
1,340
1,278
1,340
Investment in joint venture
50
20
57
Available for sale financial assets
3,124
2,917
3,441
Deferred tax assets
26
-
36

26,543
25,362
26,819
Current assets



Inventories
13,794
12,307
14,404
Trade and other receivables
13,513
11,037
14,882
Other financial assets at fair value through profit or loss
388
388
388
Short term financial assets - deposits
14,605
20,265
15,638
Cash and cash equivalents
19,341
14,443
17,911
Total current assets (excluding non-current assets and disposal groups held for sale)
61,641 
58,440
63,223




Non-current assets and disposal groups held for sale
1,772
-
-

63,413
58,440
63,223




Total Assets
89,956
83,802
90,042




Liabilities



Current liabilities



Trade and other payables
(9,258)
(7,164)
(11,012)
Current tax liabilities
(1,717)
(991)
(718)
Total current liabilities (excluding liabilities associated with non-current assets and disposal groups held for sale)
(10,975)
(8,155)
(11,730)




Liabilities associated with non-current assets and disposal groups held for sale
(553)
-
-

(11,528)
(8,155)
(11,730)
Net current assets
51,885
50,285
51,493




Non-current liabilities



Provisions for liabilities and charges
(222)
(102)
(102)
Deferred tax liabilities
(911)
(948)
(923)
Total liabilities
(12,661)
(9,205)
(12,755) 




Net assets
77,295
74,597
77,287




Equity attributable to owners of the company



Issued share capital
1,189
1,189
1,189
Share premium account
656
656
656
Capital redemption reserve
137
137
137
Retained earnings
75,313
72,615
75,305




Total equity
77,295
74,597
77,287








 


GROUP STATEMENT OF CHANGES IN EQUITY 
for the six months to 31 December 2014

Share
Share
Capital
Retained
Total

Capital
Premium
Redemption
Earnings
Equity



Reserve









'000
'000
'000
'000
'000






Balance at 30 June 2013
1,189
656
137
70,558
72,540






Comprehensive income





Profit for six months to 31 December 2013
-
-
-
4,198
4,198
Other comprehensive income
-
-
-
 199
 199
Total comprehensive income
-
-
-
4,397
4,397






Transactions with owners





Dividends paid to shareholders
-
-
-
(2,340)
(2,340)
Total transactions with owners
-
-
-
(2,340)
(2,340)






Balance at 31 December 2013
1,189
656
137
72,615
74,597






Comprehensive income





Profit for six months to 30 June 2014
-
-
-
5,991
5,991
Actuarial gain on pension scheme
-
-
-
624
624
Movement on unrecognised pension surplus
-
-
-
(1,216)
(1,216)
Revaluation of available-for-sale financial assets
-
-
-
75
75
Movement on associated deferred tax
-
-
-
(47)
(47)
Impact of deferred tax rate change
-
-
-
119
119
Exchange rate movement on joint venture
-
-
-
-
-
Total comprehensive income
-
-
-
5,546
5,546






Transactions with owners





Dividends paid to shareholders
-
-
-
(1,228)
(1,228)
Purchase of shares
-
-
-
(1,628)
(1,628)
Total transactions with owners
-
-
-
(2,856)
(2,856)






Balance at 30 June 2014
1,189
656
137
75,305
77,287






Comprehensive income





Profit for six months to 31 December 2014
-
-
-
4,314
4,314
Other comprehensive income
 - 
-
-
(40)
(40)
Total comprehensive income
-
-
-
4,274
4,274






Share-based payment expense
-
-
-
14
14






Transactions with owners





Dividends paid to shareholders
-
-
-
(4,280)
(4,280)
Total transactions with owners
-
-
-
(4,280)
(4,280)






Balance at 31 December 2014
1,189
656
137
75,313
77,295






GROUP STATEMENT OF CASH FLOWS 
for the six months to 31 December 2014

Six months to
Six monthsto
Twelve monthsto

31.12.14
31.12.13
30.06.14





(unaudited)
(restated unaudited)
(restated
unaudited)

'000
'000
'000
Cash generated from operations



Profit before income tax
5,821
5,418
12,552
Adjustments for



- Depreciation charge
709
593
1,255
- Amortisation of intangibles
651
660
1,439
- Profit on disposal of property, plant and equipment
(16)
(23)
(70)
- Share-based payment expense
14
-
-
- Finance income
(315)
(322)
(763)
- Retirement benefit contributions in excess of current and past service charge
(77)
(170)
(403)
- Share of(profit)/ loss from joint venture
4
2
(37)
Changes in working capital



- Inventories
406
(328)
(2,481)
- Trade and other receivables
1,107
1,131
(2,640)
- Trade and other payables
(1,422)
(1,814)
1,881
Discontinued operations
7
15
29
Cash generated from operations
6,889
5,162
10,762




Tax paid
(184)
(784)
(2,009)




Cash flow from investing activities



Purchase of property, plant and equipment
(1,976)
(822)
(2,087)
Proceeds of sale of property, plant and equipment
63
46
153
Purchase of intangibles - development costs and software
(623)
(540)
(1,473)
Purchase of subsidiary net of cash acquired
-
-
(390)
Purchase of investment property
-
-
(33)
Sale/(Purchase) of available for sale financial assets
271
(201)
(707)
Property rental and similar income
78
133
157
Dividend income
69
63
169
Net sale/(purchase) of deposits
1,033
(117)
4,510
Interest received
90
153
365
Receipt of loans notes
-
450
 450 
Net cash (used in)/generated from investing activities
(995)
(835)
1,114




Cash flow from financing activities



Dividends paid to company shareholders
(4,280)
(2,340)
(3,568)
Purchase of own shares
-
-
(1,628)
Net cash used in financing activities
(4,280)
(2,340)
(5,196)




Net increase in cash and cash equivalents
1,430
1,203
4,671




Cash and cash equivalents at the beginning of the period
17,911
13,240
13,240
Cash and cash equivalents at the end of the period
19,341
14,443
17,911
 Notes to the Interim Financial Statements
1. Basis of Preparation
 The consolidated interim financial statements for the six months to 31 December 2014 have been prepared in accordance with the recognition and measurement principles of applicable International Financial Reporting Standards (IFRS) in issue as adopted by the European Union (EU) and International Financial Reporting Standards as issued by the International Accounting Standards Board and the AIM Rules for Companies. 
 The figures for the period to 31 December 2014 and the comparative period to 31 December 2013 have not been audited or reviewed and are therefore disclosed as unaudited. The figures for 30 June 2014 have been extracted from the financial statements for the year to 30 June 2014, which have been delivered to the Registrar of Companies. The interim financial statements do not constitute statutory accounts within the meaning of the Companies Act 2006.

Prior period figures on the Income Statement and Cash Flow Statement have been restated to disclose the results of Sugg Lighting Limited as discontinued operations.
 The financial statements are presented in Pounds Sterling, rounded to the nearest thousand. 
 The interim financial statements are prepared under the historical cost convention, modified by the revaluation of certain current and non-current investments at fair value through profit or loss.
 The accounting policies set out in the financial statements for the year ended 30 June 2014 have been applied consistently throughout the group during the period. 
2. Segmental analysis
 The segmental analysis is presented on the same basis as that used for internal reporting purposes. For internal reporting F W Thorpe is organised into seven continuing operating segments, and one discontinued operation, based on the products and customer base in the lighting market. The largest business is Thorlux which manufactures professional lighting systems for the industrial, commercial and controls market. The six remaining continuing operating segments have been aggregated into the 'other companies' segment based on their size and comprise Compact Lighting Limited, Philip Payne Limited, Solite Europe Limited, Portland Lighting Limited, TRT Lighting Limited and Thorlux LLC.

 Sugg Lighting Limited is a discontinued operation, and its results are not included in the segmental analysis.
 F W Thorpe's chief operating decision-maker (CODM) is the group board. The group board reviews the group's internal reporting in order to monitor and assess the performance of the operating segments for the purpose of making decisions about resources to be allocated. Performance is evaluated based on a combination of revenue and operating profit. Assets and liabilities have not been segmented which is consistent with the group's internal reporting.
 2. Segmental analysis (continued)

Thorlux
Other
Inter-
Total


Companies
Segment
Continuing



Adjust-
Operations



ments


'000
'000
'000
'000
6 months to 31 December 2014




Revenue to external customers
26,601
6,028
-
32,629
Revenue to other group companies
572
831
(1,403)
-





Total revenue
27,173
6,859
(1,403)
32,629





Operating Profit
5,105
283
122
5,510





Net finance income



315
Share of loss in joint venture



(4)





Profit before tax expense



5,821





6 months to 31 December 2013




Revenue to external customers
24,637
4,947
-
29,584
Revenue to other group companies
296
451
(747)
-





Total revenue
24,933
5,398
(747)
29,584





Operating Profit
4,846
153
97
5,096





Net finance income



322
Share of profit in joint venture



-










Profit before tax expense


5,418





Year to 30 June 2014




Revenue to external customers
49,657
11,695
-
61,352
Revenue to other group companies
650
1,146
(1,796)
-





Total revenue
50,307
12,841
(1,796)
61,352





Operating Profit
10,593
961
198
11,752





Net finance income



763
Share of profit in joint venture



37










Profit before tax expense



12,552





 Inter-segment adjustments to operating profit consist of property rentals on premises owned by FW Thorpe Plc, adjustments to profit related to stocks held within the group that were supplied by another segment and adjustments to investment provisions relating to group companies.
3. Discontinued operations
 At the balance sheet date, the group had entered substantive discussions and was committed to a plan to dispose of its' subsidiary Sugg Lighting Limited. The disposal was concluded on 6 February 2015.

 The results of Sugg Lighting Limited for the current and prior periods are disclosed as discontinued operations.

A loss on disposal of subsidiary of 120,000 has been provided, representing the excess of net assets disposed over consideration receivable. The assets disposed of include the freehold of the premises occupied by Sugg Lighting Limited.
4. Earnings per share
 The basic earnings per share is calculated on profit after taxation and the weighted average number of ordinary shares in issue of 115,675,590 (Interim 2014: 116,975,590) during the period.

The diluted earnings per share is calculated on profit after taxation and the weighted average number of potentially dilutive ordinary shares in issue of 116,313,090 (Interim 2014: 116,975,590) during the period.
 
5. Dividend
 The interim dividend is at the rate of 1.10p per share (Interim 2014: 1.05p), and based on 115,675,590 shares in issue at the announcement date the dividend will amount to 1,272,000 (Interim 2014: 1,228,000). The interim dividend will be paid on 2 April 2015 to shareholders on the register at the close of business on 27 March 2015, and the shares become ex-dividend on 26 March 2015.
 A final dividend for the year ended 30 June 2014 of 2.20p (2013: final of 2.00p) per share, amounting to 2,545,000 (2013: 2,340,000), and a special dividend of 1.50p per share (2013: nil) amounting to 1,735,000 (2013: nil) was paid on 20 November 2014.
6. Share-based payment expense
 During the period, the company introduced an Executive Share Ownership Plan ('ESOP'), under which 1.7 million share options were granted on 24 October 2014 at an exercise price of 124p per share each.

Under IFRS2 an expense is recognised in the Income Statement, calculated on the fair value at the date of grant. The application of IFRS2 gave rise to a charge of 14,000 (2013: nil) for the period ended 31 December 2014, using a Black Scholes valuation model.
7. Availability of interim statement
 Copies of this report are being sent to shareholders and will also be available from the company's registered office or on the company's website (www.fwthorpe.co.uk) from 7 April 2015.

This information is provided by RNS
The company news service from the London Stock Exchange
  END
IR LLFVDVSITLIE