RNS Number : 9170X
Latham(James) PLC
30 November 2017
James Latham plc
("James Latham" or the "Company")
HALF YEARLY RESULTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017
Chairman's statement
Unaudited results for the six months trading to 30 September 2017
Revenue for the six months ended 30 September 2017 was 107.3m, up 7% on 100.3m for the same period last year. We have seen volumes continue to grow especially through our own warehouses where they are up nearly 8%. The cost price of our products overall continues to increase in comparison to the comparative six months. This is in part down to the weakening of sterling following the European Union Referendum, but also in this six months we have seen manufacturers increasing prices, and we have not been able to pass all these increases onto our customers.
Gross margin for the six month period ended 30 September 2017 was 17.3% compared with 18.7% in the comparative six months. This gross margin is similar to the 17.6% achieved in the second half of 2016/7, and we believe margins are starting to stabilise. We were also affected in this half year by some disruption to supplies from some of our key suppliers' manufacturing facilities, which are now getting back to normal.
Selling and distribution costs were 6.4% higher than last year. Distribution costs rise in line with volumes, and we monitor costs per tonne which are up by less than 2%. We have also invested in new specialist sales staff to develop the markets where we see potential for good future growth.
In July we successfully completed the move of our Yate depot to a new modern facility. I am very grateful to all of the staff involved in the move, who were very effective at minimising the disruption to the business and I am pleased to report the new facility is already performing ahead of our expectations. In this half year we incurred approximately 100,000 of one off costs relating to the move.
Profit before tax was 6.7m, down 12.2% on the comparative period's profit of 7.7m. Earnings per ordinary share were 27.8p (2016: 31.2p) a decrease of 10.9%.
As at 30 September 2017 net assets have increased to 83.8m (30.9.16: 64.5m). Fixed assets have increased by 5.6m from 31 March 2017, the majority of this being the remaining cost of the new warehouse at Yate and the start of the investment in the new warehouse at Leicester. Stock levels have remained stable throughout the period. Trade Receivables have continued to show good debtors day figures with there being another low bad debt charge of under 0.15% of turnover in the first six months. Cash and cash equivalents of 12.6m (30.9.16: 16.1m), remain strong with strong cash flows from operating activities.
The calculation of the pension deficit remains very sensitive to changes in assumptions, and the pension deficit under IAS19 is now calculated as decreasing from 16.6m at 31 March 2017 to 8.5m. This is largely due to updated membership data and an increase in the discount rate. Positive asset performance and changes to the mortality base tables also reduced the net liability. The triennial actuarial valuation as at 31 March 2017 is currently being calculated.
Interim dividend
The Board has declared an interim dividend of 4.5p per Ordinary Share (2016: 4.5p), which is covered 6.2 times (2016: 6.9 times). The dividend is payable on 26 January 2018 to ordinary shareholders on the Company's Register at close of business on 5 January 2018. The ex-dividend date will be 4 January 2018.
Current and future trading
The second half of 2017/18 has started well with growing revenues at slightly higher margins. Trading conditions continue to be mixed, but despite the uncertainties in the economy, we and our customers remain busy. We are confident in the long term prospects of our key product drivers, and this underpins our plan to continue to invest in our business to further improve the offering to our customers. Following the successful relocation of our Yate depot, we are looking forward to a relocation of our Wigston depot to a site closer to the motorway network in Leicester ahead of schedule in January 2018.
Nick Latham
Chairman
30 November 2017
This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No 596/2014.
Enquiries
James Latham plc
Tel: 01442 849 100
Nick Latham, Chairman
David Dunmow, Finance Director
Northland Capital Partners Limited Nominated Adviser and Broker
Tel: 020 3861 6625
Matthew Johnson / Edward Hutton (Corporate Finance) Bob Pountney / John Howes (Corporate Broking)
JAMES LATHAM PLC
CONSOLIDATED INCOME STATEMENT
For the six months to 30 September 2017
Six months to 30 Sept. 2017 unaudited
Six months to 30 Sept. 2016 unaudited
Year to 31 March 2017 audited
000
000
000
Revenue
107,335
100,334
198,808
Cost of sales (including warehouse costs)
(88,810)
(81,582)
(162,709)
Gross profit
18,525
18,752
36,099
Selling and distribution costs
(8,391)
(7,889)
(15,457)
Administrative expenses
(3,178)
(3,027)
(6,463)
Operating profit
6,956
7,836
14,179
Finance income
15
33
56
Finance costs
(248)
(209)
(408)
Profit before tax
6,723
7,660
13,827
Tax expense
(1,262)
(1,545)
(2,846)
Profit after tax attributable to owners of the parent company
5,461
6,115
10,981
Earnings per ordinary share (basic)
27.8p
31.2p
56.0p
Earnings per ordinary share (diluted)
27.7p
31.1p
55.8p
All results relate to continuing operations.
JAMES LATHAM PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six months to 30 September 2017
Six months to 30 Sept. 2017 unaudited
Six months to 30 Sept. 2016 unaudited
Year to 31 March 2017 audited
000
000
000
Profit after tax
5,461
6,115
10,981
Other Comprehensive income
Actuarial gains/(losses) on defined benefit pension scheme
8,515
(13,313)
(7,543)
Deferred tax relating to components of other comprehensive income
(1,430)
2,396
1,362
Other comprehensive income for the period, net of tax
7,085
(10,917)
(6,181)
Total comprehensive income, attributable to owners of the parent company
12,546
(4,802)
4,800
JAMES LATHAM PLC
CONSOLIDATED BALANCE SHEET
At 30 September 2017
As at 30 Sept. 2017 unaudited
As at 30 Sept. 2016 unaudited
As at 31 March 2017 audited
000
000
000
ASSETS
Non-current assets
Goodwill
237
237
237
Intangible assets
1
89
1
Property, plant and equipment
31,939
25,315
26,312
Deferred tax asset
1,546
4,245
2,904
Total non-current assets
33,723
29,886
29,454
Current assets
Inventories
35,915
35,065
35,508
Trade and other receivables
43,523
38,003
40,076
Cash and cash equivalents
12,585
16,102
17,246
Non-current assets held for sale
641
-
-
Total current assets
92,664
89,170
92,830
Total assets
126,387
119,056
122,284
Current liabilities
Trade and other payables
28,961
25,730
27,063
Current tax payable
1,332
1,590
1,517
Total current liabilities
30,293
27,320
28,580
Non-current liabilities
Interest bearing loans and borrowings
987
987
987
Retirement and other benefit obligation
8,470
23,208
16,625
Other payables
320
377
349
Deferred tax liabilities
2,485
2,686
2,485
Total non-current liabilities
12,262
27,258
20,446
Total liabilities
42,555
54,578
49,026
Net assets
83,832
64,478
73,258
Capital and reserves
Issued capital
5,040
5,040
5,040
Share-based payment reserve
153
70
108
Own shares
(180)
(344)
(291)
Capital reserve
3
3
3
Retained earnings
78,816
59,709
68,398
Total equity attributable to shareholders of the parent company
83,832
64,478
73,258
JAMES LATHAM PLC
CONSOLIDATED CASH FLOW STATEMENT
For the six months to 30 September 2017
Six months to 30 Sept 2017 unaudited
Six months to 30 Sept 2016 unaudited
Year to 31 March 2017 audited
000
000
000
Net cash flow from operating activities
Cash generated from operations
6,155
6,665
11,902
Interest paid
(2)
(2)
(2)
Income tax paid
(1,517)
(1,376)
(2,646)
Net cash inflow from operating activities
4,636
5,287
9,254
Cash flows from investing activities
Interest received and similar income
15
33
56
Purchase of property, plant and equipment
(7,163)
(4,035)
(6,045)
Proceeds from sale of property, plant and equipment
19
41
122
Net cash outflow from investing activities
(7,129)
(3,961)
(5,867)
Cash flows before financing activities
Equity dividends paid
(2,129)
(2,017)
(2,894)
Preference dividend paid
(39)
(39)
(79)
Net cash outflow from financing activities
(2,168)
(2,056)
(2,973)
(Decrease)/increase in cash and cash equivalents for the period
(4,661)
(730)
414
Cash and cash equivalents at beginning of the period
17,246
16,832
16,832
Cash and cash equivalents at end of the period
12,585
16,102
17,246
JAMES LATHAM PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Attributable to owners of the parent company
Issued capital 000
Share-based payment reserve 000
Own shares 000
Capital reserve 000
Retained earnings 000
Total equity 000
As at 1 April 2016 (audited)
5,040
56
(441)
3
66,525
71,183
Profit for the period
-
-
-
-
6,115
6,115
Other comprehensive income:
Actuarial loss on defined benefit pension scheme
-
-
-
-
(13,313)
(13,313)
Deferred tax relating to components of other comprehensive income
-
-
-
-
2,396
2,396
Total comprehensive income for the period
-
-
-
-
(4,802)
(4,802)
Transaction with owners:
Dividends
-
-
-
-
(2,017)
(2,017)
Exercise of options
-
(3)
-
-
3
-
Change in investment in ESOP shares
-
-
97
-
-
97
Share-based payment expense
-
17
-
-
-
17
Total transactions with owners
-
14
97
-
(2,014)
(1,903)
Balance at 30 September 2016 (unaudited)
5,040
70
(344)
3
59,709
64,478
Profit for the period
-
-
-
-
4,866
4,866
Other comprehensive income:
Actuarial gain on defined benefit pension scheme
-
-
-
-
5,770
5,770
Deferred tax relating to components of other comprehensive income
-
-
-
-
(1,034)
(1,034)
Total comprehensive income for the period
-
-
-
-
9,602
9,602
Transactions with owners:
Dividends
-
-
-
-
(877)
(877)
Exercise of options
-
(16)
-
-
16
-
Write down on conversions of ESOP shares
-
-
52
-
(52)
-
Change in investment in ESOP shares
-
-
1
-
-
1
Share-based payment expense
-
54
-
-
-
54
Total transactions with owners
-
38
53
-
(913)
(822)
Balance at 31 March 2017 (audited)
5,040
108
(291)
3
68,398
73,258
Profit for the period
-
-
-
-
5,461
5,461
Other comprehensive income:
Actuarial gain on defined benefit pension scheme
-
-
-
-
8,515
8,515
Deferred tax relating to components of other comprehensive income
-
-
-
-
(1,430)
(1,430)
Total comprehensive income for the period
-
-
-
-
12,546
12,546
Transactions with owners:
Dividends
-
-
-
-
(2,129)
(2,129)
Exercise of options
-
(3)
-
-
3
-
Write down on conversions of ESOP shares
-
-
2
-
(2)
-
Change in investment in ESOP shares
-
-
109
-
-
109
Share-based payment expense
-
48
-
-
-
48
Total transactions with owners
-
45
111
-
(2,128)
(1,972)
Balance at 30 September 2017 (unaudited)
5,040
153
(180)
3
78,816
83,832
JAMES LATHAM PLC
NOTES TO THE HALF YEARLY REPORT
1. The results presented in this report are unaudited and they have been prepared in accordance with the recognition and measurement of International Financial Reporting Standards ('IFRS') as adopted by the EU that are expected to be applicable to the financial statements for the year ending 31 March 2018 and on the basis of the accounting policies to be used in those financial statements. The figures for the year ended 31 March 2017 are extracted from the statutory accounts of the group for that period.
2. The directors propose an interim dividend of 4.5p per ordinary share which will absorb 880,000 (2017: 4.5p absorbing 880,000), payable on 26 January 2018 to shareholders on the Register at the close of business on 5 January 2018. The ex-dividend date is 4 January 2018.
3. This half yearly report does not constitute financial statutory accounts within the meaning of section 434 of the Companies Act 2006. The statutory accounts for the year ended 31 March 2017 were filed with the Registrar of Companies. The audit report on those financial statements was not qualified and did not contain a reference to any matters which the auditor drew attention by way of emphasis without qualifying the report and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. The half yearly report has not been audited by the company's auditor.
4. Earnings per ordinary share is calculated by dividing the net profit for the year attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the year.
Six months to 30 Sept 2017 unaudited
Six months to 30 Sept 2016 unaudited
Year to 31 March 2017 audited
000
000
000
Net profit attributable to ordinary shareholders
5,461
6,115
10,981
Number '000
Number '000
Number '000
Weighted average share capital
19,629
19,590
19,601
Add: diluted effect of share capital options issued
108
85
82
Weighted average share capital for diluted earnings per ordinary share calculation
19,737
19,675
19,683
5. Net cash flow from operating activities
Six months to 30 Sept 2017 unaudited
Six months to 30 Sept 2016 unaudited
Year to 31 March 2017 audited
Profit before tax
6,723
7,660
13,827
Adjustment for finance income and expenditure
233
176
352
Depreciation and amortisation
885
829
1,822
Profit on disposal of property, plant and equipment
(9)
(35)
(95)
Write down of intangible asset
-
-
86
Increase in inventories
(407)
(1,662)
(2,105)
Increase in receivables
(3,447)
(2,715)
(4,788)
Increase in payables
1,867
2,228
3,536
Own shares non cash amounts
109
97
98
Retirement benefits non cash amounts
153
70
(902)
Share-based payments non cash amounts
48
17
71
Cash generated from operations
6,155
6,665
11,902
6. Copies of this statement will be posted on our website, www.lathams.co.uk. A copy can be emailed or posted upon application to the Company Secretary, James Latham plc, Unit 3 Swallow Park, Finway Road Hemel Hempstead, Herts, HP2 7QU, or by email to plc@lathams.co.uk
This information is provided by RNS
The company news service from the London Stock Exchange
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