REG - London Security PLC - Half Yearly Report <Origin Href="QuoteRef">LSC.L</Origin>

London SecurityAnnouncement

11/09/2015 07:00

RNS Number : 7494Y
London Security PLC
11 September 2015
11 September 2015
LONDON SECURITY PLC
INTERIM RESULTS
Chairman's statement
Financial highlights
Revenue
50.2m
2014: 51.3m
Operating profit
7.9m
2014: 9.4m
TRADING
The financial highlights illustrate that the Group's revenue decreased by 1.1 million (2.1%) to 50.2 million. However these results are impacted by the movement in the Euro to Sterling average exchange rate which has increased from 1.22 to 1.36. This movement in exchange rates had an adverse effect of 4.3 million on reported turnover. If the 2015 results had been translated at 2014 rates, revenue would have been 54.5 million instead of 50.2 million, an increase of 6.2%. This real growth has come from acquisitions made in the second half of 2014 and first half of 2015, principally Pyrotec and Manus, which recorded turnover of 4.2 million. 
Operating profit decreased by 1.5 million (16.0%) to 7.9 million. Adjusting for the change in exchange rates on the same basis as above, operating profit would have been 8.7 million instead of 7.9 million (an adjusted decrease of 7.4%). This is covered by increased competition and downward pressure on prices being experienced in our market.
ACQUISITIONS
In the six months to the end of June the Group has acquired a total of six well established businesses at a cost of 1.4 million (2014: five businesses at a cost of 0.6 million). The integration of these businesses into the Group has, so far, been successful and results are in line with expectations. It remains a principal aim of the Group to grow through acquisition. Acquisitions are being sought throughout Europe and the Group will invest at the upper end of the price spectrum where an adequate return is envisaged by the Board.
PROSPECTS
Economic growth in the Group's market has been depressed 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 customer base, the Board is optimistic for further success in 2015 as growth improves.
DIVIDENDS
A final dividend in respect of 2014 of 0.31 per ordinary share was paid to shareholders on 8 July 2015.
J.G. Murray
Chairman
11 September 2015


Consolidated income statement
for the six months ended 30 June 2015
Unaudited
Unaudited
Audited
six months
six months
year
ended
ended
ended
30 June
30 June
31 December
2015
2014
2014
Note
'000
'000
'000
Revenue
50,191
51,279
100,876
Cost of sales
(10,105)
(9,840)
(18,638)
Gross profit
40,086
41,439
82,238
Distribution costs
(19,297)
(19,585)
(38,106)
Administrative expenses
(12,872)
(12,430)
(24,451)
Operating profit
7,917
9,424
19,681
EBITDA*
10,341
11,544
23,938
Depreciation and amortisation
(2,424)
(2,120)
(4,257)
Operating profit
7,917
9,424
19,681
Finance income
84
93
188
Finance costs
(208)
(435)
(832)
Finance costs - net
(124)
(342)
(644)
Profit before income tax
7,793
9,082
19,037
Income tax expense
(2,561)
(2,907)
(6,362)
Profit for the period attributable to equity shareholders of the Company
5,232
6,175
12,675
Earnings per share


Basic and diluted
3
42.7p
50.4p
103.4p
Dividends


Dividends paid per share
Nil
Nil
62p
* Earnings before interest, taxation, depreciation, amortisation and impairment charges.
The above are all as a result of continuing operations.


Consolidated statement of comprehensive income
for the six months ended 30 June 2015
Unaudited
Unaudited
Audited
six months
six months
year
ended
ended
ended
30 June
30 June
31 December
2015
2014
2014
'000
'000
'000
Profit for the financial period
5,232
6,175
12,675
Other comprehensive (expense)/income:

Items that will not be reclassified subsequently toprofit or loss

- currency translation differences on foreign operation consolidation, net of tax
(2,194)
(1,108)
(1,955)
- actuarial gain recognised in the Nu-Swift pensionscheme
-
-
127
- movement on deferred tax relating to the Nu-Swift pension scheme surplus
-
-
(518)
- actuarial loss recognised in the Ansul pensionscheme
-
-
(191)
- movement on deferred tax relating to the Ansulpension scheme
-
-
69
Other comprehensive expense fortheperiod, net of tax
(2,194)
(1,108)
(2,468)
Total comprehensive income for the period
3,038
5,067
10,207


Consolidated statement of changes in equity
for the six months ended 30 June 2015
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 2014
123
344
1
2,033
5,713
74,597
82,811
Comprehensive income for the period







- profit for the period
-
-
-
-
-
6,175
6,175
- exchange adjustments
-
-
-
-
(1,108)
-
(1,108)
Total comprehensive income fortheperiod
-
-
-
-
(1,108)
6,175
5,067
At 30 June 2014
123
344
1
2,033
4,605
80,772
87,878
Comprehensive income for the period







- profit for the period
-
-
-
-
-
6,500
6,500
- exchange adjustments
-
-
-
-
(847)
-
(847)
- actuarial loss on pension schemes
-
-
-
-
-
(64)
(64)
- movement on deferred tax relating topensionschemes
-
-
-
-
-
(449)
(449)
Total comprehensive income fortheperiod
-
-
-
-
(847)
5,987
5,140
Contributions by and distributions toowners oftheCompany:







- dividends
-
-
-
-
-
(7,602)
(7,602)
Total contributions by and distributions toowners ofthe Company
-
-
-
-
(7,602)
(7,602)
At 31 December 2014
123
344
1
2,033
3,758
79,157
85,416
Comprehensive income for the period







- profit for the period
-
-
-
-
-
5,232
5,232
- exchange adjustments
-
-
-
-
(2,194)
-
(2,194)
Total comprehensive income fortheperiod
-
-
-
-
(2,194)
5,232
3,038
At 30 June 2015
123
344
1
2,033
1,564
84,389
88,454


Consolidated statement of financial position
for the six months ended 30 June 2015
Unaudited
Unaudited
Audited
as at
as at
as at
30 June
30 June
31 December
2015
2014
2014
'000
'000
'000
Assets
Non-current assets
Property, plant and equipment
9,335
9,751
9,747
Intangible assets
60,603
57,468
61,400
Deferred tax asset
699
604
753
Retirement benefit surplus
3,283
2,469
3,283

73,920
70,292
75,183
Current assets
Inventories
8,885
9,221
9,494
Trade and other receivables
19,953
20,117
19,573
Cash and cash equivalents
22,696
26,203
20,978

51,534
55,541
50,045
Total assets
125,454
125,833
125,228
Liabilities
Current liabilities
Trade and other payables
(18,279)
(17,617)
(18,232)
Income tax liabilities
(636)
(383)
(1,389)
Borrowings
(1,659)
(1,823)
(1,782)
Provision for liabilities and charges
-
(4)
-

(20,574)
(19,827)
(21,403)
Non-current liabilities
Trade and other payables
(703)
(535)
(739)
Borrowings
(11,965)
(14,890)
(13,678)
Derivative financial instruments
(163)
(86)
(227)
Deferred income tax liabilities
(1,667)
(987)
(1,701)
Retirement benefit obligations
(1,687)
(1,630)
(1,843)
Provision for liabilities and charges
(241)
-
(221)

(16,426)
(18,128)
(18,409)
Total liabilities
(37,000)
(37,955)
(39,812)
Net assets
88,454
87,878
85,416
Shareholders' equity
Ordinary shares
123
123
123
Share premium
344
344
344
Capital redemption reserve
1
1
1
Merger reserve
2,033
2,033
2,033
Other reserves
1,564
4,605
3,758
Retained earnings
84,389
80,772
79,157
Total shareholders' equity
88,454
87,878
85,416


Consolidated statement of cash flow
for the six months ended 30 June 2015
Unaudited
Unaudited
Audited
six months
six months
year
ended
ended
ended
30 June
30 June
31 December
2015
2014
2014
'000
'000
'000
Cash flows from operating activities
Cash generated from operations
9,865
11,764
24,338
Interest paid
(208)
(239)
(472)
Income tax paid
(3,560)
(2,676)
(5,218)
Net cash generated from operating activities
6,097
8,849
18,648
Cash flows from investing activities

Acquisition of subsidiary undertakings
(902)
-
(2,164)
Purchases of property, plant and equipment
(1,125)
(1,126)
(2,304)
Proceeds from sale of property, plant andequipment
91
133
242
Purchases of intangible assets
(373)
(667)
(3,519)
Proceeds from sale of intangible assets
-
39
-
Interest received
20
48
68
Net cash used in investing activities
(2,289)
(1,573)
(7,677)
Cash flows from financing activities

Repayments of borrowings
(844)
(914)
(1,855)
Dividends paid to Company's shareholders
-
-
(7,602)
Net cash used infinancingactivities
(844)
(914)
(9,457)
Effects of exchange rates oncashandcashequivalents
(1,246)
(724)
(1,101)
Net increase in cash in the period
1,718
5,638
413
Cash and cash equivalents at beginning of the period
20,978
20,565
20,565
Cash and cash equivalents at end of the period
22,696
26,203
20,978


Notes to the financial statements
for the six months ended 30 June 2015
1 Nature of information
The financial information contained in this Interim Statement has been neither audited nor reviewed by the auditor and does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. The financial information for the six months ended 30 June 2015 has been prepared applying the accounting policies and presentation that were applied in the preparation of the Group's published consolidated financial statements for the year ended 31 December 2014. The principal risks and uncertainties as disclosed in the year end accounts are considered to be consistent with those that are still applicable now.
Comparative figures for the year ended 31 December 2014 have been extracted from the statutory accounts for the year ended 31 December 2014 which have been delivered to the Registrar of Companies. The Independent Auditor's Report on those accounts was unqualified and did not contain an emphasis of matter paragraph orany statement under Section 498 of the Companies Act 2006.
2 Basis of preparation
The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.
3 Earnings per share
The calculation of basic earnings per ordinary share is based on the profit on ordinary activities after taxation of 5,232,000 (2014: 6,175,000) and on 12,261,477 (2014: 12,261,477) ordinary shares, being the weighted average number of ordinary shares in issue during the period.
For diluted earnings per ordinary share, the weighted average number of shares in issue is adjusted to assume conversion of all potentially dilutive 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.
Unaudited
Unaudited
Audited
six months
six months
year
ended
ended
ended
30 June
30 June
31 December
2015
2014
2014
'000
'000
'000
Profit on ordinary activities after taxation
5,232
6,175
12,675
Basic earnings per ordinary share
42.7p
50.4p
103.4p
4 Actuarial valuation of the pension scheme
As permitted under IAS 19 the Group has not prepared an actuarial valuation of the pension scheme assets and liabilities for the Interim Statement 2015. In accordance with IAS 19 such a valuation will be prepared for the purposes of the Group's Annual Report and Accounts 2015.
For further information, please contact:
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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