REG - Holders Technology - Final Results
Holders Technology plc
("the Group")
Specialised PCB Materials, Lighting and Control Solutions
Final results for the year ended 30 November 2020
Holders Technology plc (AIM: HDT) announces its audited results for the year ended 30 November 2020.
The Group supplies specialty laminates and materials for printed circuit board manufacture ("PCB") and operates as a Lighting and Control Solutions ("LCS") provider. The Group operates from the UK and from Germany, with PCB divisions and LCS divisions in each country. During the year, investments were also made in LCS joint ventures in the UK and Austria.
Revenue for all divisions was reduced by the economic consequences of the Covid-19 pandemic, particularly the LCS divisions. The companies have reduced costs whenever possible, and PCB divisions taken together remained profitable. However, the LCS divisions became loss making.
The directors will recommend payment of a final dividend of 0.25p per share, a total of 0.50p for the year (2019 total: 0.75p).
The results are summarised below.
2020
2019
£'000
£'000
· Revenue
PCB
7,314
8,647
LCS
2,524
3,515
Group
9,838
12,162
· Operating Profit/ (Loss)
PCB
102
230
LCS
(246)
69
Central costs
(105)
(155)
Group
(249)
144
· (Loss)/ profit before tax
Group
(264)
150
Tax (expense)/ credit
-
31
(Loss)/ profit after tax
(264)
181
· Cash Balances
Group
1,113
734
· Basic (Loss)/ earnings per Share
Group
(6.25p)
4.31p
· Diluted (Loss)/ earnings per Share
Group
(6.25p)
4.30p
This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.
For further information, contact:
Holders Technology plc
01896 758781
Rudi Weinreich, Executive Chairman
Victoria Blaisdell, Group Managing Director
Paul Geraghty, Group Finance Director
Website www.holderstechnology.com
SP Angel Corporate Finance LLP - Nominated Advisor & Broker
020 3470 0470
Matthew Johnson / Caroline Rowe
Chairman's statement
The Group principally operates from the UK and from Germany, with a PCB division and an LCS division in each country. In addition, during the year investments were made in LCS joint ventures in the UK and Austria.
Inevitably the Group results were impacted by the economic consequences of the Covid-19 pandemic. We have reduced costs in the UK and Germany wherever possible, including salary reductions for higher paid employees, and making use of government support schemes where available.
Revenue for the year was £9.8m (2019: £12.2m), with gross margins of 27.5% (2019: 27.9%). The operating loss for the year was £249,000 (2019: operating profit of £144,000), and the loss after tax was £264,000 (2019: profit of £181,000).
The PCB divisions taken together had revenue of £7.3m (2019: £8.7m) and achieved an operating profit of £102,000 (2019: profit of £230,000). PCB gross margins increased from 24.3% to 24.4%. In both the UK and Germany, PCB revenues held up well in the first half but showed a material reduction in the second half of the year.
As reported last year, the LCS sales and technical team was strengthened in the second half of 2019. Despite the exceptional economic situation in 2020, this team was retained in anticipation of an improvement in market conditions in 2021. LCS revenues overall amounted to £2.5m (2019: £3.5m) with gross margins decreasing from 36.7% to 36.5% and there was an operating loss of £246,000 (2019: profit of £69,000).
Two new 50:50 joint ventures were set up in 2020 as follows:
· Holders Technology Austria GmbH is a joint venture with a sales partner based in Austria. The new company sells wireless lighting control solutions in Austria, Switzerland, Czechia, and Slovakia. The joint venture achieved breakeven in the period.
· Holders Technology Data Analytics Ltd was set up with a data analytics company in the Netherlands. The new company has developed a data analytics platform for smart lighting and building solutions. It will commence trading in 2021.
On behalf of the Board, I would like to record our thanks to our staff for their hard work during the exceptional conditions experienced in 2020. Given the outcome for the year, the Board recommends a final dividend of 0.25p in respect of the 2020 year.
The outlook for the first half of 2021 is more positive than the second half of 2020, with increased sales levels and order books. As for many similar companies however, sustained improvement is heavily dependent on a recovery in the wider economy during 2021.
R W Weinreich
Executive Chairman
19 February 2021
Group income statement for the year ended 30 November 2020
Note
2020
2019
£'000
£'000
Revenue
9,838
12,162
Cost of sales
(7,135)
(8,770)
Gross profit
2,703
3,392
Distribution costs
(348)
(419)
Administrative expenses
(2,562)
(2,890)
Other operating (expenses)/ income
(42)
61
Operating (loss)/ profit
(249)
144
Income from joint ventures
1
-
Finance (expenses)/ income
(16)
6
(Loss)/ profit before taxation
(264)
150
Tax credit/ (expense)
2
-
31
(Loss)/ profit after taxation attributable to equity shareholders
(264)
181
Basic (loss)/ earnings per share
4
(6.25p)
4.31p
Diluted (loss)/ earnings per share
4
(6.25p)
4.30p
Group statement of comprehensive income for the year ended 30 November 2020
2020
£'000
2019
£'000
Profit for the year
(264)
181
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translating foreign operations
120
(94)
Total comprehensive income for the year
(144)
87
Statement of changes in equity for the year ended 30 November 2020
Group
Share capital
Share premium account
Capital redemption reserve
Translation reserve
Retained earnings
Total equity
£'000
£'000
£'000
£'000
£'000
£'000
Balance at 1 December 2018
416
1,590
1
222
1,870
4,099
Dividends
-
-
-
-
(32)
(32)
Shares issued
6
-
-
-
-
6
Share based payments
-
-
-
-
4
4
Transactions with owners
6
-
-
-
(28)
(22)
Profit for the year
-
-
-
-
181
181
Exchange differences on translating foreign operations
-
-
-
(94)
-
(94)
Loss and total comprehensive income for the year
-
-
-
(94)
181
87
Balance at 30 November 2019
422
1,590
1
128
2,023
4,164
Dividends
-
-
-
-
(21)
(21)
Transactions with owners
-
-
-
-
(21)
(21)
Loss for the year
-
-
-
-
(264)
(264)
Exchange differences on translating foreign operations
-
-
-
120
-
120
Loss and total comprehensive income for the year
-
-
-
120
(264)
(144)
Balance at 30 November 2020
422
1,590
1
248
1,738
3,999
Group balance sheet at 30 November 2020
2020
2019
£'000
£'000
Assets
Non-current assets
Intangible fixed assets
381
394
Property, plant and equipment
560
237
Investments in joint ventures
28
-
Deferred tax assets
12
12
981
643
Current assets
Inventories
2,340
2,530
Trade and other receivables
1,420
1,758
Cash and cash equivalents
1,113
734
4,873
5,022
Liabilities
Current liabilities
Trade and other payables
(1,274)
(1,280)
Lease liabilities
(105)
-
(1,379)
(1,280)
Net current assets
3,494
3,742
Non-current liabilities
Retirement benefit liability
(223)
(212)
Lease liabilities
(244)
-
Deferred tax liabilities
(9)
(9)
(476)
(221)
3,999
4,164
Shareholders' equity
Share capital
422
422
Share premium account
1,590
1,590
Capital redemption reserve
1
1
Retained earnings
1,738
2,023
Cumulative translation adjustment reserve
248
128
3,999
4,164
Statement of cash flows for the year ended 30 November 2020
2020
2019
£'000
£'000
Cash flows from operating activities
(Loss)/ profit before tax from continuing operations
(264)
150
Share-based payment charge
-
4
Depreciation
292
74
Decrease in inventories
284
237
Decrease/ (increase) in trade and other receivables
385
(140)
(Decrease)/ increase in trade and other payables
Interest (Income)/ Expense
(50)
16
92
(6)
Cash generated from operations
663
411
Interest paid
Income from investments
(16)
(1)
(8)
-
Net cash (used in)/ generated from operations
646
403
Cash flows from investing activities
Purchase of property, plant and equipment
(25)
(42)
Investment in Joint Venture
(27)
-
Proceeds from sale of property, plant and equipment
-
1
Net cash (used in)/generated from investing activities
(52)
(41)
Cash flows from financing activities
Sale of shares
-
6
Repayment of leases
(213)
-
Equity dividends paid
(21)
(32)
Net cash used in financing activities
(234)
(26)
Net change in cash and cash equivalents
360
336
Cash and cash equivalents at start of period
734
403
Effect of foreign exchange rates
19
(5)
Cash and cash equivalents at end of period
1,113
734
Notes
1. Basis of preparation
The Group and parent company financial statements have been prepared in accordance with EU endorsed International Financial Reporting Standards (IFRS), International Financial Reporting Interpretations Committee (IFRIC) interpretations and with those parts of the Companies Act applicable to companies reporting under IFRS. All accounting standards and interpretations issued by the International Accounting Standards Board and the International Financial Reporting Interpretations Committee effective at the time of preparing these financial statements have been applied.
2. Taxation
2020
£'000
2019
£'000
Analysis of the charge in the period
Current tax
- Current period
-
-
- Credit adjustment in respect of prior periods
-
(29)
-
(29)
Deferred tax charge/ (credit)
-
(2)
Total tax
-
(31)
Tax reconciliation
The tax for the period is lower (2019: lower) than the standard rate of corporation tax in the UK, effectively 19.0% (2019: 19.0%) for the company's financial year. The differences are explained below:
2020
£'000
2019
£'000
(Loss)/ profit before taxation
(264)
150
(Loss)/ profit before taxation multiplied by the rate of corporation tax in the UK of 19.0% (2019: 19.0%)
(50)
29
Effects of:
Adjustment from prior years
-
(29)
Taxation losses
50
(31)
Taxation
-
(31)
3. Dividends
The directors have proposed a final dividend of 0.25p per share payable on 1 June 2021 to shareholders on the register at close of business on 14 May 2021. The total dividend for the year, including the interim dividend of 0.25p (2019: 0.25p) per share paid on 6 October 2020, amounts to £21,000 (2019: £32,000), which is equivalent to 0.50p (2019: 0.75p) per share.
4. The basic earnings per share are based on the loss for the financial year of £264,000 (2019: profit of £181,000) and on ordinary shares of 4,224,164 (2019: 4,199,735 shares), the weighted average number of shares in issue during the year. Diluted earnings per share is based on 4,224,164 ordinary shares (2019: 4,207,199 shares), being the weighted average number of ordinary shares after an adjustment of £nil (2019: 7,464) in relation to share options.
5. This statement, which has been approved by the Board on 19 February 2021, is not the Company's statutory accounts. The statutory accounts for each of the two years to 30 November 2019 and 30 November 2020 received audit reports which were unqualified and did not contain statements under section 498(2) and section 498(3) of the Companies Act 2006. The 2019 accounts have been filed with the registrar of Companies, but the 2020 statutory accounts are not yet filed.
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