REG - London Security PLC - Final Results <Origin Href="QuoteRef">LSC.L</Origin>

London SecurityAnnouncement

15/07/2015 16:12

RNS Number : 2734M
London Security PLC
06 May 2015
London Security plc
Annual Report and Accounts 2014
CHAIRMAN'S STATEMENT
FINANCIAL HIGHLIGHTS
Financial highlights of the audited results for the year ended 31 December 2014 compared with the year ended 31 December 2013 are as follows:
 revenue of 100.9 million (2013: 101.4 million);
 operating profit before depreciation and amortisation of 23.9 million (2013: 24.1 million);
 operating profit of 19.7 million (2013: 20.0 million); and
 profit after income tax of 12.7 million (2013: 13.7 million).
TRADING REVIEW
The financial highlights illustrate that the Group's revenue decreased by 0.5 million (0.5%) to 100.9 million. However, these results are impacted by the movement in the Euro to Sterling average exchange rate which has increased from 1.18 to 1.24. This movement in exchange rates had an adverse effect of 4.0 million on reported turnover. If the 2014 results had been translated at 2013 rates, revenue would have been 104.9 million instead of 100.9 million (increase of 3.5% on the prior year).
Operating profit decreased by 0.3 million (1.5%) to 19.7 million. Adjusting for the change in the exchange rate on the same basis as above, operating profit would have been 20.6 million instead of 19.7 million (increase of 3.0%). This performance is very satisfactory and whilst the trading environment remains difficult we are hopeful of growth returning to our market.
A more detailed review of this year's performance is given in the Financial Review and Strategic Report.
ACQUISITIONS
It remains a principal aim of the Group to grow through acquisition. Acquisitions are being sought throughout Europe and the Group will invest at prices where an adequate return is envisaged by the Board. In the year under review the Group has consolidated its presence, particularly in Austria and the UK with the incorporation of PMP Manus G.m.b.H., and the acquisition of Tunbridge Wells Fire Protection Limited and the Pyrotec businesses, Pyrotec Fire Protection Limited and Pyrotec Fire Detection Limited. In addition a further seven acquisitions of service contracts were concluded for smaller, well established businesses for integration into the Group's existing subsidiaries.
MANAGEMENT AND STAFF
2014 was a year in which the staff performed well and, on your behalf, I would like to express thanks and appreciation for their contribution.
DIVIDENDS
A final dividend in respect of 2013 of 0.31 per ordinary share was paid to shareholders on 8 July 2014.
An interim dividend in respect of 2014 of 0.31 per ordinary share was paid to shareholders on 19 December 2014.
The Board is recommending the payment of a final dividend in respect of 2014 of 0.31 per ordinary share to be paid on 8 July 2015 to shareholders on the register on 12 June 2015. The shares will be marked ex-dividend on 10 June 2015.
FUTURE PROSPECTS
Economic growth in the Group's market has been depressed in 2014 but our business remains strong, cash generative and well developed, with positive net funds. There are signs of a slow recovery and, as a leading provider in this market with a well-diversified and loyal customer base, the Board is optimistic for further success in 2015 as growth improves.
ANNUAL GENERAL MEETING
The Annual General Meeting will be held at 10 Bruton Street, 5th Floor, London W1J 6PX on 17 June 2015 at 11 am. You will find enclosed a form of proxy for use at that Meeting which you are requested to complete and return in accordance with the instructions on the form. Your Directors look forward to meeting you at that time.
J.G. Murray
Chairman
5 May 2015


Consolidated income statement
for the year ended 31 December 2014
2014
2013
Note
'000
'000
Revenue
100,876
101,362
Cost of sales
(18,638)
(19,785)
Gross profit
82,238
81,577
Distribution costs
(38,106)
(37,894)
Administrative expenses
(24,451)
(23,729)
Operating profit
19,681
19,954
EBITDA*
23,938
24,059
Depreciation and amortisation
(4,257)
(4,105)
Operating profit
19,681
19,954
Finance income
188
377
Finance costs
(832)
(475)
Finance costs - net
(644)
(98)
Profit before income tax
19,037
19,856
Income tax expense
(6,362)
(6,148)
Profit for the year attributable to equity shareholders of the Company
12,675
13,708
Earnings per share
Basic and diluted
1
103.4p
111.8p
* Earnings before interest, tax, depreciation and amortisation.


Consolidated statement of comprehensive income
for the year ended 31 December 2014
2014
2013
'000
'000
Profit for the financial year
12,675
13,708
Other comprehensive income:
Items that will not be reclassified subsequently to profit or loss
- currency translation differences on foreign currency net investments, net of tax
(1,955)
331
- actuarial gain/(loss) recognised in the Nu-Swift pension scheme
127
(72)
- movement on deferred tax relating to Nu-Swift pension scheme surplus
(518)
(485)
- Nu-Swift pension scheme surplus recognised
-
1,794
- actuarial loss recognised in the Ansul pension scheme
(191)
(381)
- movement on deferred tax relating to Ansul pension scheme deficit
69
166
Other comprehensive (loss)/gain for the year, net of tax
(2,468)
1,353
Total comprehensive income for the year
10,207
15,061


Consolidated statement of changes in equity
for the year ended 31 December 2014
Profit
Share
Share
Capital
Merger
Other
and loss
capital
premium
redemption
reserve
reserve
account
Total
'000
'000
'000
'000
'000
'000
'000
At 1 January 2013
123
344
1
2,033
5,382
69,136
77,019
Total comprehensive income for the year
Profit for the financial period
-
-
-
-
-
13,708
13,708
Other comprehensive income:
- exchange adjustments
-
-
-
-
331
-
331
- actuarial loss on pension scheme
-
-
-
-
-
(453)
(453)
- net movement on deferred tax relating to pension asset
-
-
-
-
-
(319)
(319)
- brought forward pension surplus recognised
-
-
-
-
-
1,794
1,794
Total comprehensive income for the year
-
-
-
-
331
14,730
15,061
Contributions by and distributions
to owners of the Company:
- dividends
-
-
-
-
-
(9,319)
(9,319)
- release of provision for unclaimed dividends
-
-
-
-
-
50
50
Total contributions by and distributions to owners of the Company
-
-
-
-
-
(9,269)
(9,269)
At 1 January 2014
123
344
1
2,033
5,713
74,597
82,811
Total comprehensive income for the year
Profit for the financial period
-
-
-
-
-
12,675
12,675
Other comprehensive income:
- exchange adjustments
-
-
-
-
(1,955)
-
(1,955)
- actuarial loss on pension schemes
-
-
-
-
-
(64)
(64)
- net movement on deferred tax relating to pension asset
-
-
-
-
-
(449)
(449)
Total comprehensive income for the year
-
-
-
-
(1,955)
12,162
10,207
Contributions by and distributions to owners of the Company:
- dividends
-
-
-
-
-
(7,602)
(7,602)
Total contributions by and distributions to owners of the Company
-
-
-
-
-
(7,602)
(7,602)
At 31 December 2014
123
344
1
2,033
3,758
79,157
85,416
The merger reserve is not a distributable reserve. The other reserve relates entirely to the effects of changes in foreign currency exchange rates.


Consolidated statement of financial position
as at 31 December 2014
2014
2013
'000
'000
Assets
Non-current assets
Property, plant and equipment
9,747
9,973
Intangible assets
61,400
58,325
Deferred tax asset
753
632
Retirement benefit surplus
3,283
2,424
Derivative financial instruments
-
92
75,183
71,446
Current assets
Inventories
9,494
8,826
Trade and other receivables
19,573
21,153
Cash and cash equivalents
20,978
20,565
50,045
50,544
Total assets
125,228
121,990
Liabilities
Current liabilities
Trade and other payables
(18,232)
(16,992)
Income tax liabilities
(1,389)
(866)
Borrowings
(1,782)
(1,878)
Provision for liabilities and charges
-
(4)
(21,403)
(19,740)
Non-current liabilities
Trade and other payables
(739)
(509)
Borrowings
(13,678)
(16,261)
Derivative financial instruments
(227)
-
Deferred tax liabilities
(1,701)
(991)
Retirement benefit obligations
(1,843)
(1,678)
Provision for liabilities and charges
(221)
-
(18,409)
(19,439)
Total liabilities
(39,812)
(39,179)
Net assets
85,416
82,811
Shareholders' equity
Ordinary shares
123
123
Share premium
344
344
Capital redemption reserve
1
1
Merger reserve
2,033
2,033
Other reserves
3,758
5,713
Retained earnings
79,157
74,597
Total shareholders' equity
85,416
82,811
Consolidated statement of cash flow
for the year ended 31 December 2014
2014
2013
'000
'000
Cash flows from operating activities
Cash generated from operations
24,338
22,913
Interest paid
(472)
(418)
Income tax paid
(5,218)
(5,625)
Net cash generated from operating activities
18,648
16,870
Cash flows from investing activities
Acquisition of subsidiary undertakings (net of cash acquired)
(2,164)
(3,002)
Purchases of property, plant and equipment
(2,304)
(2,537)
Proceeds from sale of property, plant and equipment
242
275
Proceeds from sale of intangible assets
-
33
Purchases of intangible assets
(3,519)
(2,575)
Interest received
68
96
Net cash used in investing activities
(7,677)
(7,710)
Cash flows from financing activities
Repayments of borrowings
(1,855)
(16,610)
New borrowings
-
19,675
Associated loan arrangement fees
-
(488)
Dividends paid to Company's shareholders
(7,602)
(9,319)
Net cash used in financing activities
(9,457)
(6,742)
Effects of exchange rates on cash and cash equivalents
(1,101)
286
Net increase in cash in the year
413
2,704
Cash and cash equivalents at beginning of the year
20,565
17,861
Cash and cash equivalents at end of the year
20,978
20,565


Notes to the financial statements
for the year ended 31 December 2014
1 Earnings per share
The calculation of basic earnings per ordinary share ("EPS") is based on the profit on ordinary activities after taxation of 12,675,000 (2013: 13,708,000) and on 12,261,477 (2013: 12,261,477) ordinary shares, being the weighted average number of ordinary shares in issue during the year.
For diluted EPS, the weighted average number of shares in issue is adjusted to assume conversion of all dilutive potential ordinary shares. There was no difference in the weighted average number of shares used for the calculation of basic and diluted earnings per share as there are no potentially dilutive shares outstanding.
2014
2013
'000
Pence
'000
Pence
Profit on ordinary activities after taxation
12,675
103.4
13,708
111.8
2This preliminary announcement does not constitute the Company's statutory accounts within the meaning of Section 434 of the Companies Act 2006.
The results for the year ended 31 December 2014 have been extracted from the full accounts of the Group for that year which received an unqualified auditor's report and which have not yet been delivered to the Registrar of Companies. The financial information for the year ended 31 December 2013 is derived from the statutory accounts for that year, which have been delivered to the Registrar of Companies. The report of the auditor on those filed accounts was unqualified. The accounts for the year ended 31 December 2014 and 31 December 2013 did not contain a statement under s498 (1) to (4) of the Companies Act 2006 or under s237(1) to (4) of the Companies Act 1985.
This preliminary announcement has been prepared in accordance with International Financial Reporting Standards. The Group will post its annual report and accounts to shareholders on 15 May 2015. A copy of the annual report and accounts can be found on the company's webpage (www.londonsecurity.org). 
Enquiries: London Security plc
 Richard Pollard
 Company Secretary Tel: 01422 372852
WH Ireland Limited
  Andrew Kitchingman   Tel: 0113 394 6600
 Liam Gribben

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