REG - Hilton Food Grp Plc - Preliminary Results <Origin Href="QuoteRef">HFG.L</Origin> - Part 2
31/03/2016 07:05
- Part 2: For the preceding part double click ID:nRSe5932Ta
1,222 884
Operating profit 28,999 26,062
Finance income 4 97 102
Finance costs 4 (1,148) (976)
Finance costs - net 4 (1,051) (874)
Profit before income tax 27,948 25,188
Income tax expense 5 (6,489) (5,638)
Profit for the year 21,459 19,550
Attributable to:
Owners of the parent 20,017 18,071
Non-controlling interests 1,442 1,479
21,459 19,550
Earnings per share attributable to owners of the parent during the year
Basic (pence) 6 27.5 25.0
Diluted (pence) 6 27.2 24.7
Consolidated statement of comprehensive income
2015 2014
53 weeks 52 weeks
£'000 £'000
Profit for the year 21,459 19,550
Other comprehensive income
Currency translation differences (2,739) (4,761)
Other comprehensive income for the year net of tax (2,739) (4,761)
Total comprehensive income for the year 18,720 14,789
Total comprehensive income attributable to:
Owners of the parent 17,552 13,625
Non-controlling interests 1,168 1,164
18,720 14,789
The notes are an integral part of these consolidated financial statements.
Consolidated balance sheet
Group Company
2015 2014 2015 2014
Notes £'000 £'000 £'000 £'000
Assets
Non-current assets
Property, plant and equipment 8 67,230 72,642 - -
Intangible assets 9 10,073 12,547 - -
Investments 2,396 1,234 102,985 102,985
Deferred income tax assets 1,000 771 - -
80,699 87,194 102,985 102,985
Current assets
Inventories 18,272 22,029 - -
Trade and other receivables 96,095 115,609 470 53
Current income tax assets - 1,532 11 30
Cash and cash equivalents 52,806 35,586 150 333
167,173 174,756 631 416
Total assets 247,872 261,950 103,616 103,401
Equity
Equity attributable to owners of the parent
Ordinary shares 7,286 7,259 7,286 7,259
Share premium 8,191 7,235 8,191 7,235
Employee share schemes reserve 901 441 - -
Foreign currency translation reserve (4,489) -2,024 - -
Retained earnings 82,829 72,717 17,120 13,470
94,718 85,628 32,597 27,964
Reverse acquisition reserve (31,700) (31,700) - -
Merger reserve 919 919 71,019 71,019
63,937 54,847 103,616 98,983
Non-controlling interests 4,938 4,786 - -
Total equity 68,875 59,633 103,616 98,983
Liabilities
Non-current liabilities
Borrowings 10 28,405 32,573 - -
Deferred income tax liabilities 1,654 1,875 - -
30,059 34,448 - -
Current liabilities
Borrowings 10 11,728 10,687 - -
Trade and other payables 136,537 157,182 - 4,418
Current income tax liabilities 673 - - -
148,938 167,869 - 4,418
Total liabilities 178,997 202,317 - 4,418
Total equity and liabilities 247,872 261,950 103,616 103,401
The notes are an integral part of these consolidated financial statements.
The financial statements were approved by the Board on 30 March 2016 and were signed on its behalf by:
R. Watson OBE N. Majewski
Director Director
Hilton Food Group plc - Registered number: 06165540
Consolidated statement of changes in equity
Attributable to owners of the parent
Share capital Share premium Employee share schemes reserve Foreign currency translation reserve Retained earnings Reverse acquisition reserve Merger reserve Total Non-controlling interests Total equity
Group Notes £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 30 December 2013 7,216 5,885 857 2,422 63,989 (31,700) 919 49,588 4,670 54,258
Profit for the year - - - - 18,071 - - 18,071 1,479 19,550
Other comprehensive income
Currency translation differences - - - (4,446) - - - (4,446) (315) (4,761)
Total comprehensive income for the year - - - (4,446) 18,071 - - 13,625 1,164 14,789
Issue of new shares 43 794 - - - - - 837 - 837
Adjustment in respect of employee share schemes - 406 (151) - - - - 255 - 255
Tax on employee share schemes - 150 (265) - - - - (115) - (115)
Dividends paid 7 - - - - (9,343) - - (9,343) (1,048) (10,391)
Total transactions with owners 43 1,350 (416) - (9,343) - - (8,366) (1,048) (9,414)
Balance at 28 December 2014 7,259 7,235 441 (2,024) 72,717 (31,700) 919 54,847 4,786 59,633
Profit for the year - - - - 20,017 - - 20,017 1,442 21,459
Other comprehensive income
Currency translation differences - - - (2,465) - - - (2,465) (274) (2,739)
Total comprehensive income for the year - - - (2,465) 20,017 - - 17,552 1,168 18,720
Issue of new shares 27 516 - - - - - 543 - 543
Adjustment in respect of employee share schemes - 408 342 - - - - 750 - 750
Tax on employee share schemes - 32 118 - - - - 150 - 150
Dividends paid 7 - - - - (9,905) - - (9,905) (1,016) (10,921)
Total transactions with owners 27 956 460 - (9,905) - - (8,462) (1,016) (9,478)
Balance at 3 January 2016 7,286 8,191 901 (4,489) 82,829 (31,700) 919 63,937 4,938 68,875
Company
Balance at 30 December 2013 7,216 5,885 - - 11,922 - 71,019 96,042
Profit for the year - - - - 10,891 - - 10,891
Total comprehensive income for the year - - - - 10,891 - - 10,891
Issue of new shares 43 794 - - - - - 837
Adjustment in respect of employee share schemes - 406 - - - - - 406
Tax on employee share schemes - 150 - - - - - 150
Dividends paid 7 - - - - (9,343) - - (9,343)
Total transactions with owners 43 1,350 - - (9,343) - - (7,950)
Balance at 28 December 2014 7,259 7,235 - - 13,470 - 71,019 98,983
Profit for the year - - - - 13,555 - - 13,555
Total comprehensive income for the year - - - - 13,555 - - 13,555
Issue of new shares 27 516 - - - - - 543
Adjustment in respect of employee share schemes - 408 - - - - - 408
Tax on employee share schemes - 32 - - - - - 32
Dividends paid 7 - - - - (9,905) - - (9,905)
Total transactions with owners 27 956 - - (9,905) - - (8,922)
Balance at 3 January 2016 7,286 8,191 - - 17,120 - 71,019 103,616
The notes are an integral part of these consolidated financial statements.
Consolidated cash flow statement
Group Company
2015 2014 2015 2014
53 weeks 52 weeks 53 weeks 52 weeks
Notes £'000 £'000 £'000 £'000
Cash flows from operating activities
Cash generated from operations 11 50,960 47,626 (386) -
Interest paid (1,148) (976) (72) (171)
Income tax (paid)/received (4,553) (5,530) - 87
Net cash generated from/(used in) operating activities 45,259 41,120 (458) (84)
Cash flows from investing activities
Purchases of property, plant and equipment (13,676) (31,830) - -
Proceeds from sale of property, plant and equipment 77 129 - -
Purchases of intangible assets (54) (11,599) - -
Interest received 97 102 - -
Dividends received - - 13,600 11,000
Net cash (used in)/generated from investing activities (13,556) (43,198) 13,600 11,000
Cash flows from financing activities
Proceeds from borrowings 3,336 36,193 - -
Repayments of borrowings (6,157) (21,923) - -
Repayment of inter-company loan - - (3,963) (2,266)
Issue of ordinary shares 543 837 543 837
Dividends paid to owners of the parent (9,905) (9,343) (9,905) (9,343)
Dividends paid to non-controlling interests (1,016) (1,048) - -
Net cash (used in)/ generated from financing activities (13,199) 4,716 (13,325) (10,772)
Net increase/(decrease) in cash and cash equivalents 18,504 2,638 (183) 144
Cash and cash equivalents at beginning of the year 35,586 34,642 333 189
Exchange losses on cash and cash equivalents (1,284) (1,694) - -
Cash and cash equivalents at end of the year 52,806 35,586 150 333
The notes are an integral part of these consolidated financial statements.
Notes to the financial statements
1 General information
Hilton Food Group plc ("the Company") and its subsidiaries (together "the
Group") is a specialist retail meat packing business supplying major
international food retailers in thirteen European countries and Australia. The
Company's subsidiaries are listed in a note.
The Company is a public limited company incorporated and domiciled in the UK.
The address of the registered office is 2-8 The Interchange, Latham Road,
Huntingdon, Cambridgeshire PE29 6YE. The registered number of the Company is
06165540.
The Company maintains a Premium Listing on the London Stock Exchange.
The financial year represents the 53 weeks to 3 January 2016 (prior financial
year 52 weeks to 28 December 2014).
This preliminary announcement was approved for issue on 30 March 2016.
2 Summary of significant accounting policies
The accounting policies are consistent with those of the annual financial
statements for the year ended 28 December 2014.
Basis of preparation
The consolidated financial statements of Hilton Food Group plc have been
prepared under the historical cost convention and in accordance with
International Financial Reporting Standards as adopted by the European Union
(IFRS), IFRIC interpretations and the Companies Act 2006 applicable to
companies reporting under IFRS.
The consolidated financial statements have been prepared on the going concern
basis. The reasons why the Directors consider this basis to be appropriate are
set out in the Performance and financial review.
The financial statements are presented in Sterling and all values are rounded
to the nearest thousand (£'000) except when otherwise indicated.
The preparation of financial statements in conformity with IFRS requires the
use of certain critical accounting estimates. It also requires management to
exercise its judgement in the process of applying the Group's accounting
policies. The areas involving a higher degree of judgement or complexity, or
areas where assumptions and estimates are significant to the consolidated
financial statements are disclosed in a note.
The financial information included in this preliminary announcement does not
constitute statutory accounts of the Group for the years ended 3 January 2016
and 28 December 2014 but is derived from those accounts. Statutory accounts
for 2014 have been delivered to the Registrar of Companies and those for 2015
will be delivered following the Company's Annual General Meeting. 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.
3 Segment information
Management have determined the operating segments based on the reports
reviewed by the Executive Directors that are used to make strategic
decisions.
The Executive Directors have considered the business from both a geographic
and product perspective.
From a geographic perspective, the Executive Directors consider that the Group
has seven operating segments: i) United Kingdom; ii) Netherlands; iii)
Republic of Ireland; iv) Sweden; v) Denmark, vi) Central Europe including
Poland, Czech Republic, Hungary, Slovakia, Latvia, Lithuania and Estonia and
vii) Central costs and other including the share of profit from the joint
venture in Australia. The United Kingdom, Netherlands, Republic of Ireland,
Sweden and Denmark have been aggregated into one reportable segment 'Western
Europe' as they have similar economic characteristics as identified in IFRS 8.
Central Europe and Central costs and other comprise the other reportable
segments.
From a product perspective the Executive Directors consider that the Group has
only one identifiable product, wholesaling of meat. The Executive Directors
consider that no further segmentation is appropriate, as all of the Group's
operations are subject to similar risks and returns and exhibit similar long
term financial performance.
The segment information provided to the Executive Directors for the reportable segments is as follows:
Central Central
Western Central costs and 2015 Western Central costs and 2014
Europe Europe other Total Europe Europe other Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Total segment revenue 1,020,844 74,165 - 1,095,009 1,018,368 82,156 - 1,100,524
Inter-segment revenue (187) - - (187) (1,534) - - (1,534)
Revenue from external customers 1,020,657 74,165 - 1,094,822 1,016,834 82,156 - 1,098,990
Operating profit/(loss)/segment result 32,107 2,255 (5,363) 28,999 27,115 2,426 (3,479) 26,062
Finance income 20 76 1 97 20 81 1 102
Finance costs (1,066) - (82) (1,148) (667) - (309) (976)
Income tax expense (6,959) (455) 925 (6,489) (5,902) (502) 766 (5,638)
Profit/(loss) for the year 24,102 1,876 (4,519) 21,459 20,566 2,005 (3,021) 19,550
Depreciation and amortisation 18,205 1,036 122 19,363 14,354 1,186 96 15,636
Additions to non-current assets 12,905 547 278 13,730 42,492 824 113 43,429
Segment assets 224,739 17,836 4,297 246,872 240,231 15,949 3,467 259,647
Current income tax assets - 1,532
Deferred income tax assets 1,000 771
Total assets 247,872 261,950
Segment liabilities 165,283 9,411 1,976 176,670 190,316 7,521 1,163 199,000
Borrowings - 1,442
Current income tax liabilities 673 -
Deferred income tax liabilities 1,654 1,875
Total liabilities 178,997 202,317
Sales between segments are carried out at arm's length. Revenue from external
customers reported to the Executive Directors is measured in a manner
consistent with that in the income statement.
The Executive Directors assess the performance of each operating segment based
on its operating profit. Operating profit is measured in a manner consistent
with that in the income statement.
The amounts provided to the Executive Directors with respect to total assets
and liabilities are measured in a manner consistent with that of the financial
statements. The assets are allocated based on the operations of the segment
and their physical location. The liabilities are allocated based on the
operations of the segment. The Group interest bearing reorganisation loan is
not considered to be a segment liability.
The Group has four principal customers (comprising groups of entities known to
be under common control), Tesco, Ahold, Coop Danmark and ICA Gruppen. These
customers are located in the United Kingdom, Netherlands, Republic of Ireland,
Sweden, Denmark and Central Europe including Poland, Czech Republic, Hungary,
Slovakia, Latvia, Lithuania and Estonia.
Analysis of revenues from external customers and non-current assets are as follows:
Revenues from external customers Non-current assets excluding deferred tax assets
2015 2014 2015 2014
£'000 £'000 £'000 £'000
Analysis by geographical area
United Kingdom - country of domicile 441,673 391,139 39,784 40,200
Netherlands 257,398 266,049 9,445 10,645
Sweden 182,621 197,603 13,752 13,828
Republic of Ireland 55,880 60,289 3,999 4,351
Denmark 83,174 101,754 9,757 13,821
Central Europe 74,076 82,156 2,962 3,578
1,094,822 1,098,990 79,699 86,423
Analysis by principal customer
Customer 1 513,401 472,883
Customer 2 284,560 299,779
Customer 3 197,608 212,698
Customer 4 81,634 99,996
Other 17,619 13,634
1,094,822 1,098,990
4 Finance income and costs
2015 2014
Group £'000 £'000
Finance income
Interest income on short term bank deposits 90 97
Interest on income taxes 7 5
Finance income 97 102
Finance costs
Bank borrowings (920) (765)
Finance leases (161) (189)
Exchange (losses)/gains on foreign currency borrowings (3) 22
Other interest expense (64) (44)
Finance costs (1,148) (976)
Finance costs - net (1,051) (874)
5 Income tax expense
2015 2014
Group £'000 £'000
Current income tax
Current tax on profits for the year 6,787 4,795
Adjustments to tax in respect of previous years (18) 47
Total current tax 6,769 4,842
Deferred income tax
Origination and reversal of temporary differences (389) 704
Adjustments to tax in respect of previous years 109 92
Total deferred tax (280) 796
Income tax expense 6,489 5,638
Deferred tax credited directly to equity during the year in respect of
employee share schemes amounted to £118,000 (2014: £265,000 charge).
The tax on the Group's profit before income tax differs from the theoretical
amount that would arise using the standard rate of UK Corporation Tax of
20.25% (2014: 21.5%) applied to profits of the consolidated entities as
follows:
2015 2014
£'000 £'000
Profit before income tax 27,948 25,188
Tax calculated at the standard rate of UK Corporation Tax 20.25% (2014: 21.5%) 5,659 5,415
Expenses not deductible/(income not taxable) for tax purposes 371 (37)
Adjustments to tax in respect of previous years 91 139
Profits taxed at rates other than 20.25% (2014: 21.5%) 375 133
Other (7) (12)
Income tax expense 6,489 5,638
There is no tax impact relating to components of other comprehensive income.
6 Earnings per share
Basic earnings per share are calculated by dividing the profit attributable to
owners of the parent by the weighted average number of ordinary shares in
issue during the year.
Diluted earnings per share are calculated by adjusting the weighted average
number of ordinary shares outstanding to assume conversion of all dilutive
potential ordinary shares. The Company has share options for which a
calculation is done to determine the number of shares that could have been
acquired at fair value (determined as the average annual market share price of
the Company's shares) based on the monetary value of the subscription rights
attached to outstanding share options. The number of shares calculated as
above is compared with the number of shares that would have been issued
assuming the exercise of the share options.
2015 2014
Group Basic Diluted Basic Diluted
Profit attributable to owners of the parent (£'000) 20,017 20,017 18,071 18,071
Weighted average number of ordinary shares in issue (thousands) 72,748 72,748 72,379 72,379
Adjustment for share options (thousands) - 970 - 714
Adjusted weighted average number of ordinary shares (thousands) 72,748 73,718 72,379 73,093
Basic and diluted earnings per share (pence) 27.5 27.2 25.0 24.7
7 Dividends
2015 2014
Group and Company £'000 £'000
Final dividend in respect of 2014 paid 9.5p per ordinary share (2014: 9.1p) 6,919 6,590
Interim dividend in respect of 2015 paid 4.1p per ordinary share (2014: 3.8p) 2,986 2,753
Total dividends paid 9,905 9,343
The Directors declared a second interim dividend of 9.2p which is to be paid
on 1 April 2016 and propose a final dividend of 1.3p per share payable on 1
July 2016 to shareholders who are on the register at 3 June 2016. These
dividends totalling £7.7m have not been recognised as a liability in these
consolidated financial statements.
8 Property, plant and equipment
Land and buildings (including leasehold improvements) Plant and machinery Fixtures and fittings Motor vehicles Total
Group £'000 £'000 £'000 £'000 £'000
Cost
At 30 December 2013 26,162 153,085 11,151 311 190,709
Exchange adjustments (909) (9,319) (636) (3) (10,867)
Additions 13,176 17,473 1,165 16 31,830
Reclassification (754) 3,344 (2,672) 82 -
Disposals - (4,368) (454) (109) (4,931)
At 28 December 2014 37,675 160,215 8,554 297 206,741
Accumulated depreciation
At 30 December 2013 16,328 106,567 8,805 133 131,833
Exchange adjustments (535) (6,364) (476) (1) (7,376)
Charge for the year 1,966 11,391 1,006 74 14,437
Reclassification (492) 2,582 (2,090) - -
Disposals - (4,265) (443) (87) (4,795)
At 28 December 2014 17,267 109,911 6,802 119 134,099
Net book amount
At 30 December 2013 9,834 46,518 2,346 178 58,876
At 28 December 2014 20,408 50,304 1,752 178 72,642
Cost
At 29 December 2014 37,675 160,215 8,554 297 206,741
Exchange adjustments (724) (5,167) (250) (1) (6,142)
Additions 3,521 9,391 755 9 13,676
Reclassification - (235) 53 - (182)
Disposals (1,464) (561) (88) (7) (2,120)
At 3 January 2016 39,008 163,643 9,024 298 211,973
Accumulated depreciation
At 29 December 2014 17,267 109,911 6,802 119 134,099
Exchange adjustments (460) (3,573) (188) - (4,221)
Charge for the year 3,737 12,219 860 68 16,884
Reclassification - (72) 21 - (51)
Disposals (1,464) (406) (91) (7) (1,968)
At 3 January 2016 19,080 118,079 7,404 180 144,743
Net book amount
At 3 January 2016 19,928 45,564 1,620 118 67,230
Land and buildings are held under short leaseholds. Details of bank borrowings
secured on assets of the Group are given in note 10. Depreciation charges are
included within administrative expenses in the income statement.
The cost and net book amount of property plant and equipment in the course of
its construction included above comprise plant and machinery £1,654,000 (2014:
£1,209,000).
Property, plant and equipment include the following amounts where the Group is
a lessee under a finance lease:
2015 2014
£'000 £'000
Cost - capitalised finance leases 3,011 3,195
Accumulated depreciation (1,794) (1,742)
Net book amount 1,217 1,453
Included in assets held under finance leases are land and buildings with a net book amount of £1,217,000 (2014: £1,453,000).
9 Intangible assets
Product licences Computer software Goodwill Total
Group £'000 £'000 £'000 £'000
Cost
At 30 December 2013 8,833 4,441 836 14,110
Exchange adjustments (977) (475) - (1,452)
Additions 11,449 150 - 11,599
At 28 December 2014 19,305 4,116 836 24,257
Accumulated amortisation
At 30 December 2013 7,789 3,661 - 11,450
Exchange adjustments (525) (414) - (939)
Charge for the year 892 307 - 1,199
At 28 December 2014 8,156 3,554 - 11,710
Net book amount
At 30 December 2013 1,044 780 836 2,660
At 28 December 2014 11,149 562 836 12,547
Cost
At 29 December 2014 19,305 4,116 836 24,257
Exchange adjustments (560) (137) - (697)
Additions - 54 - 54
Reclassifications - 182 - 182
Disposals - (123) - (123)
At 3 January 2016 18,745 4,092 836 23,673
Accumulated amortisation
At 29 December 2014 8,156 3,554 - 11,710
Exchange adjustments (408) (109) - (517)
Charge for the year 2,142 337 - 2,479
Reclassifications - 51 - 51
Disposals - (123) - (123)
At 3 January 2016 9,890 3,710 - 13,600
Net book amount
At 3 January 2016 8,855 382 836 10,073
Amortisation charges are included within administrative expenses in the income
statement.
10
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