REG - Headlam Group PLC - Final Results 2016 <Origin Href="QuoteRef">HEAD.L</Origin> - Part 2
07/03/2017 07:07
- Part 2: For the preceding part double click ID:nRSG6809Ya
- - - - 1,824 (14,301) (12,477)
Balance at 31 December 2015 4,268 53,512 88 5,429 (516) (5,276) 137,603 195,108
Balance at 1 January 2016 4,268 53,512 88 5,429 (516) (5,276) 137,603 195,108
Profit for the year attributable to the equity shareholders - - - - - - 30,963 30,963
Other comprehensive income - - - 1,707 747 - (3,709) (1,255)
Total comprehensive income/(expense) for the year - - - 1,707 747 - 27,254 29,708
Transactions with equity shareholders, recorded directly in equity
Share-based payments - - - - - - 1,239 1,239
Share options exercised by employees - - - - - 740 (317) 423
Consideration for purchase of own shares - - - - - (647) - (647)
Current tax on share options - - - - - - 21 21
Deferred tax on share options - - - - - - (21) (21)
Dividends to equity holders - - - - - - (22,464) (22,464)
Total contributions by and distributions to equity shareholders - - - - - 93 (21,542) (21,449)
Balance at 31 December 2016 4,268 53,512 88 7,136 231 (5,183) 143,315 203,367
*See note 1.
Cash Flow Statements
for the year ended 31 December 2016
2016£000 2015£000
Cash flows from operating activities
Profit before tax for the year 38,179 35,624
Adjustments for:
Depreciation, amortisation and impairment 5,276 5,179
Finance income (756) (738)
Finance expense 1,722 1,891
(Profit)/loss on sale of property, plant and equipment (15) (31)
Share-based payments 1,239 1,100
Operating cash flows before changes in working capital and other payables 45,645 43,025
Change in inventories (5,895) (1,827)
Change in trade and other receivables (6,467) (1,524)
Change in trade and other payables 10,365 7,270
Cash generated from the operations 43,648 46,944
Interest paid (1,133) (1,268)
Tax paid (7,703) (6,245)
Additional contributions to defined benefit plan (2,171) (2,925)
Net cash flow from operating activities 32,641 36,506
Cash flows from investing activities
Proceeds from sale of property, plant and equipment 401 277
Interest received 752 726
Dividends received - -
Acquisition of subsidiaries, net of cash acquired - (1,977)
Acquisition of property, plant and equipment (2,963) (2,856)
Net cash flow from investing activities (1,810) (3,830)
Cash flows from financing activities
Proceeds from the issue of treasury shares 423 1,005
Payment to acquire own shares (647) -
Repayment of borrowings (20,000) (2,817)
Drawdown of loans 6,456 -
Dividends paid (22,464) (14,655)
Net cash flow from financing activities (36,232) (16,467)
Net (decrease)/increase in cash and cash equivalents (5,401) 16,209
Cash and cash equivalents at 1 January 63,932 47,589
Effect of exchange rate fluctuations on cash held 808 134
Cash and cash equivalents at 31 December 59,339 63,932
Notes
1 Accounting Policies
Basis of preparation
The comparative balance sheet has been restated in order to; align certain
accounting policies of overseas companies, better reflect the net value of
certain inventory product lines, reassess deferred tax in relation to
property, and to reclassify certain balances in order to present them in a
consistent manner with the current year.
The net impact of these changes has been to change the Statement of Financial
Position as follows:
£000
Property plant and equipment 3,414
Deferred tax (6,142)
Inventory (978)
Trade and other receivables 146
Trade and other payables 239
Brought forward reserves 3,321
2 Non-underlying items
Non-underlying items relate to non-recurring people costs paid out during the
year and the related tax on these costs.
3 Segment reporting
At 31 December 2016, the Company has 56 operating segments in the UK and three
operating segments in Continental Europe. On 28 February 2017, the group
acquired Mitchell Carpets Limited taking the total to 60 operating segments.
Each segment represents an individual trading operation, and each operation is
wholly aligned to the sales, marketing, supply and distribution of
floorcovering products. The operating results of each operation are regularly
reviewed by the Chief Operating Decision Maker, which is deemed to be the
Chief Executive. Discrete financial information is available for each segment
and used by the Chief Executive to assess performance and decide on resource
allocation.
The operating segments have been aggregated to the extent that they have
similar economic characteristics. The key economic indicators considered by
management in assessing whether operating segments have similar economic
characteristics are the products supplied, the type and class of customer,
method of sale and distribution and the regulatory environment in which they
operate.
As each operating segment is a trading operation wholly aligned to the sales,
marketing, supply and distribution of floorcovering products, management
consider all segments have similar economic characteristics except for the
regulatory environment in which they operate, which is determined by the
country in which the operating segment resides.
The Company's internal management structure and financial reporting systems
differentiate the operating segments on the basis of the differing economic
characteristics in the UK and Continental Europe and accordingly present these
as two separate reportable segments. This distinction is embedded in the
construction of operating reports reviewed by the Chief Executive, the Board
and the executive management team and forms the basis for the presentation of
operating segment information given below.
UK Continental Europe Total
2016£000 Restated*2015£000 2016£000 Restated*2015£000 2016£000 Restated*2015£000
Revenue
External revenues 602,104 575,341 91,468 78,737 693,572 654,078
Reportable segment underlying operating profit 40,944 37,363 793 575 41,737 37,938
Reportable segment assets 263,968 255,189 44,516 36,030 308,484 291,219
Reportable segment liabilities (167,755) (158,859) (23,801) (13,087) (191,556) (171,946)
During the year, there were no inter-segment revenues for the reportable
segments (2015: £nil).
*See note 1.
Reconciliations of reportable segment profit, assets and liabilities and other
material items:
2016£000 2015£000
Profit for the year
Total profit for reportable segments 41,737 37,938
Non-underlying items (1,927) -
Unallocated expense (665) (1,161)
Operating profit 39,145 36,777
Finance income 756 738
Finance expense (1,722) (1,891)
Profit before taxation 38,179 35,624
Taxation (7,216) (7,213)
Profit for the year 30,963 28,411
2016£000 Restated*2015£000
Assets
Total assets for reportable segments 308,484 291,219
Unallocated assets:
Properties, plant and equipment 90,981 93,242
Deferred tax assets 1,138 629
Cash and cash equivalents 28,171 33,001
Total assets 428,774 418,091
Liabilities
Total liabilities for reportable segments (191,556) (171,946)
Unallocated liabilities:
Employee benefits (22,950) (19,014)
Other interest-bearing loans and borrowings - (20,000)
Income tax payable (6,824) (6,974)
Derivative liabilities - (516)
Deferred tax liabilities (4,077) (4,533)
Total liabilities (225,407) (222,983)
UK £000 Continental Europe £000 Reportable segment total £000 Unallocated £000 Consolidated total £000
Other material items 2016
Capital expenditure 1,808 872 2,680 283 2,963
Depreciation 2,388 732 3,120 2,156 5,276
Non-underlying items - - - 1,927 1,927
Other material items 2015
Capital expenditure 2,064 543 2,607 287 2,894
Depreciation 2,246 538 2,784 2,020 4,804
Amortisation - - - 375 375
In the UK the Company's freehold properties are held within Headlam Group plc
and a rent is charged to the operating segments for the period of use.
Therefore, the operating reports reviewed by the Chief Executive show all the
UK properties as unallocated and the operating segments report a segment
result that includes a property rent. This is reflected in the above
disclosure.
Each segment is a continuing operation.
The Chief Executive, the Board and the senior executive management team have
access to information that provides details on revenue by principal product
group for the two reportable segments, as set out in the following table:
Revenue by principal product group and geographic origin is summarised below:
UK Continental Europe Total
2016£000 2015£000 2016£000 2015£000 2016£000 2015£000
Revenue
Residential 422,048 399,453 46,337 40,281 468,385 439,734
Commercial 180,056 175,888 45,131 38,456 225,187 214,344
602,104 575,341 91,468 78,737 693,572 654,078
*See note 1.
4 Earnings per share
2016£000 2015£000
Earnings
Earnings for underlying basic and underlying diluted earnings per share 32,505 -
Earnings for basic and diluted earnings per share 30,963 28,411
2016 2015
Number of shares
Issued ordinary shares at 31 December 85,363,743 85,363,743
Effect of shares held in treasury (1,330,339) (1,331,576)
Weighted average number of ordinary shares for the purposes of basic earnings per share 84,033,404 84,032,167
Effect of diluted potential ordinary shares:
Weighted average number of ordinary shares at 31 December 84,033,404 84,032,167
Dilutive effect of share options 458,697 282,078
Weighted average number of ordinary shares for the purposes of diluted earnings per share 84,492,101 84,314,245
5 Dividends
2016£000 2015£000
Interim dividend for 2015 of 6.00p paid 2 January 2016 5,048 -
Special dividend for 2015 of 6.00p paid 25 April 2016 5,048 -
Final dividend for 2015 of 14.70p paid 1 July 2016 12,368 -
Interim dividend for 2014 of 5.20p paid 2 January 2015 - 4,355
Final dividend for 2014 of 12.30p paid 1 July 2015 - 10,300
22,464 14,655
The final proposed dividend of 15.85 pence per share (2015: 14.70 pence per
share) will not be provided for until authorised by shareholders at the
forthcoming AGM. There are no income tax consequences.
Interim dividends of 6.70 pence per share (2015: 6.00 pence per share) are
provided for when the dividend is paid. The dividend was paid on 3 January
2017 and totalled £5,637,000.
The total value of dividends proposed but not recognised at 31 December 2016
is £18,974,000 (2015: £17,416,000).
A special dividend has been declared of 8.00 pence per share that will be paid
on 24 April 2017 to shareholders on the register at 31 March 2017.
6 Subsequent events
Management have given due consideration to any events occurring in the period
from the reporting date to the date these financial statements were authorised
for issue and have concluded that there are no material adjusting or
non-adjusting events to be disclosed in these financial statements, with the
exception of the acquisition of Mitchell Carpets Limited. On 28 February
2017, a group subsidiary company acquired 100% of the issued share capital of
Mitchell Carpets Limited, a floorcovering distribution business based in
Poole, Dorset, for a consideration of £1,980,000, subject to finalising the
net assets position.
7 Additional information
The financial information set out above does not constitute the Company's
statutory accounts for the years ended 31 December 2016 or 2015 but is derived
from those accounts. Statutory accounts for 2015 have been delivered to the
registrar of companies, and those for 2016 will be delivered in due course.
The auditors have reported on those accounts; their reports were (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.
We anticipate that the Company's statutory accounts will be posted to
shareholders during April 2017 and will be displayed on the Company's website
at www.headlam.com at the same time. Copies of the statutory accounts will
also be available from the Company's registered office at Headlam Group plc,
PO Box 1, Gorsey Lane, Coleshill, Birmingham, B46 1LW.
This final results announcement for the year ended 31 December 2016 was
approved by the Board on
7 March 2017.
This information is provided by RNS
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