REG - MS International PLC - Final Results

MS InternationalAnnouncement

22/06/2021 07:00

RNS Number : 6169C
  
MS International PLC
  
22 June 2021
  
 

 
Chairman's Statement
 
 
Results and Review
 
It is both pleasing and reassuring to report that for the year ended 30th April 2021, the Company returned to profits with a pre-tax figure of £1.59m (2020 - loss £3.25m) on revenue of £61.54m (2020 - £61.15m). Basic earnings per share amounted to 7.2p, (2020 - loss per share of 15.1p). The balance sheet has strengthened, with total cash increased to £23.56m (2020 - £16.30m).
 
Exceptionally good progress has been made across the Group, despite the negative and distracting influence of the global pandemic. Furthermore, the outlook is now much brighter than we could have imagined twelve months ago. We have lost neither skills, nor potential market opportunities and are now starting to benefit from the numerous ambitious development projects and investment programmes that we have been diligently progressing over the past few years.
 
'Defence'
 
We continued to stay abreast of our obligations to our many international defence business customers, completing sales of new weapon installations, whilst fully supporting and servicing customers around the world, including twelve individual navies. International marketing activity was, by enforced necessity, sadly restrained. The home market with the UK MoD remains, disappointingly subdued.
 
Pleasingly, a request from the US Navy, that we field our 'state of the art' 30mm MSI-DS naval weapon system for an evaluation trials programme resulted in a highly positive outcome. We have since been awarded a contract for the supply of seven systems, the first of which has now been delivered directly to the US Navy. We are hopeful that these sales may well lead to follow on production orders.  In addition, following the award of that contract, we received an order from a US shipbuilder to supply eight similar weapon systems for a US government Foreign Military Sales Programme.
 
This important break-through in the United States defence market, is a direct result of our persistent and purposeful marketing effort within the US over many years and our relentless, and crucially important, investment in product development programmes for the world markets.
 
'Forgings'
 
This division started the period in a relatively weak business environment, centred around a Brexit settlement and the overhanging potential loss or reduction in fork-arm requirements from our many EU based customers; then Covid hit! The uncertainties were not helped by the growing deterioration in the availability and supply of raw materials and components and their increasing costs. Not only were our own requirements affected but also those of our customers' other material requirements.
 
Market conditions only started to improve in early 2021, after many of our existing and potential customers reverting to a 'buy-local' philosophy, rather than continuing to buy 'economic dumped' product from China, where reliability of supply had seriously deteriorated. This positive trend for us, when added to our earlier restructuring of our UK operations, at last brought some positive economic sanity into the international markets we serve through our indigenous fork-arm manufacturing plants in the UK, plus North and South America.
 
 'Petrol Station Superstructures'
 
Despite a much slowed 'pandemic induced' start to the period in the UK, once HM Government determined that petrol stations in England were deemed an essential operation and could remain open, there was a notable upturn in our business activity. Throughout the lockdowns, many of our UK customers, particularly those operating stations that included a quality convenience store and, in some cases, a food outlet, traded well, even though it is reported that fuel sales dropped by 70% at the height of the restrictions. As travel restrictions were eased, so the need for structural maintenance and new builds gained momentum and there was a pleasing marked restoration in our UK activities.
 
Unfortunately, there was not a similar freedom of movement across mainland Europe and consequently our operation in Poland - which traditionally services customers from Scandinavia and across Eastern Europe - had a much reduced, activity level throughout the period.
 
Notwithstanding the challenges, the division, led by the UK operation, achieved a marked improvement in profitability over that reported in the prior year.
 
'Corporate Branding'
 
This division, which operates primarily across western European through operations based in The Netherlands and Germany, experienced a ten per cent reduction in activity compared to the previous year, owing to local and cross border travel restrictions and vigorously enforced lockdowns across the EU. Consequently, revenue was some 30% lower than anticipated. Across the sectors we serve, petrol, hospitality, airports and automotive, people movement was intensely restricted and as a consequence many of our customers' development programmes were simply put on an 'extended hold'.
 
By contrast, our UK 'Petrol Sign' business has continued to grow and prosper, responding in line with the more positive approach taken by the UK forecourt market highlighted in my comments on 'Petrol Station Superstructures'.
 
 
Outlook
 
'Defence'
 
Our recent positive breakthrough into the western world's largest defence market is truly most encouraging and we will do our utmost to progress the many perceived opportunities that are out there. Our other product developments, aimed at opening up new global markets, are progressing to plan and once international travel arrangements can recommence this will enable the business to exploit a number of perceived and very promising opportunities.
 
Simultaneously, we are upgrading the capabilities of our existing UK manufacturing facilities and systems, to enhance further our production capabilities to meet anticipated future demand. 
 
'Forgings'
 
With our highly efficient 'local' manufacturing operations in the UK, the United States and Brazil, we are well placed to take advantage of the growing ecological and economic pressures regarding minimising long distance shipping of products around the globe.
 
'Petrol Station Superstructures'
 
The UK petrol station market has recovered strongly and very positively from the initial lock-down pressures of the pandemic.
 
There continues to be a notable, and very positive change, in the structure of petrol station ownership in the UK. The long-established ownership of stations by the large international oil companies is diminishing and passing to that of that a small number of privately owned, well- funded, entrepreneurial groups. Consequently, there is considerable investment taking place to enhance their station operations, creating what is being termed 'mobility hubs,' that will offer, not only a wide variety of fuel options, but also high quality and spacious convenience stores; fast-food outlets; rest areas and internet amenities plus superior car valeting facilities.
 
 
 
 
 
 
With our Group's extensive experience and high reputation in the construction, maintenance and, most recently, the branding of petrol stations, we aim to continue to provide a superior, high quality service to these relatively new, and progressively minded, groups.
 
Our Poland based business, that enjoys an outstanding reputation for performance amongst the many customers it regularly serves in numerous countries, is well positioned to respond once inter country travel restraints are lifted and there is a restoration of business normality.     
 
'Corporate Branding'
 
This division has still to contend with the present ongoing operational restraints on travel across international borders, necessitated by the pandemic.
 
In the meantime, we have reorganised and integrated the operations of this division to reflect the wider product and market sectors it serves. Not only have we considerably reduced costs, but it is now better focused on meeting the expectations of a broader customer market than just 'petrol', which had previously been the prime focus when we acquired the 'Petrol Sign BV' business in 2015.
 
In concluding, I thank all our employees for their support and commitment to the business in what has clearly been a most disruptive and frustrating business year for everyone.
 
Our thanks also to HM Government and to those Governments, in countries where we have operating businesses, for their 'Covid-19' support in what has been an unprecedented time.
 
Our commitment to moving the business forward remains at the forefront of our objectives after 15 months of continuous global restrictions. We remain resilient and dedicated, along with a great team of people and are well placed to achieving our aim. Most importantly, we also enjoy further enhanced strong financial resources to support and develop opportunities as they arise.
 
All matters considered the Board recommends the payment of a reinstated final dividend of 6.5p per share (2020 - 1.75p) making a total for the year of 8.25p (2020 - 3.5p). The final dividend is expected to be paid on the 10th August 2021, to those shareholders on the register at the close of business on 16th July 2021.
 
 
 
 
Michael Bell
21st June 2021
 
 
 
 



MS INTERNATIONAL plc 












Michael Bell






Tel: 01302 322133


















Shore Capital (Nominated Adviser and Broker)












Patrick Castle






Tel: 020 7408 4090




Daniel Bush












Copies of this announcement are available from the Company's registered office at MS INTERNATIONAL plc, Balby Carr Bank, Doncaster, DN4 8DH, England.  The full Annual Report and Accounts, which will include the Notice of AGM, will be posted to shareholders on 6th July, 2021, will be available on the Company's website at www.msiplc.com and will be delivered to the Registrar of Companies after it has been laid before the Company's members at the Annual General Meeting to be held on 29th July 2021 at The Holiday Inn, Warmsworth, Doncaster.






Consolidated income statement




























For the year ended 30th April, 2021












































2021






2020




Continuing operations














Total






Total




















£'000






£'000


































Revenue














61,539 






61,153 




Cost of sales














(44,218)






(48,275)




Gross profit














17,321 






12,878 


































Distribution costs














(2,581)






(3,455)




Administrative expenses














(12,954)






(12,542)


















































(15,535)






(15,997)




Group operating profit/(loss)














1,786 






(3,119)


































Share of net profit of joint venture














28 






  -  




Interest received














10 






133 




Interest paid














(92)






(103)




Other finance costs - pensions














(140)






(164)




















(222)






(134)




Profit/(loss) before taxation 














1,592 






(3,253)




Taxation














(415)






762 




Profit/(loss) for the year attributable to equity holders of the parent














1,177 






(2,491)


































Basic earnings/(loss) per share














7.2p






(15.1p)




Diluted earnings/(loss) per share














7.0p






(15.1p)
































































Consolidated statement of comprehensive income












For the year ended 30th April, 2021


































































2021






2020




















Total






Total




















£'000






£'000


































Profit/(loss) for the year attributable to equity holders of the parent














1,177 






(2,491)




Exchange differences on retranslation of foreign operations














(38)






(55)




Net other comprehensive loss to be reclassified to profit or loss in subsequent years






(38)






(55)




Remeasurement gains/(losses) on defined benefit pension scheme














1,213 






(2,197)




Deferred tax on remeasurement on defined benefit scheme














(230)






545 




Deferred tax on revaluation surplus on land and buildings














 - 






(110)




Net other comprehensive income/(loss) not being reclassified to profit or loss in subsequent years






983 






(1,762)


































Total comprehensive income/(loss) for the year attributable to equity holders of the parent






2,122 






(4,308)



 




 



Consolidated and company statement of changes in equity




For the year ended 30th April, 2021








































































Share capital






Capital redemption reserve






Other reserves






Revaluation reserve






Special reserve






Currency translation reserve






Treasury shares






Retained earnings






Total shareholders' funds
















£'000






£'000






£'000






£'000






£'000






£'000






£'000






£'000






£'000






















































































(a) Group












































































At 27th April, 2019






1,840 






901 






2,815 






6,055 






1,629 






279 






(3,059)






25,338 






35,798 




Loss for the year






-  






-  






-  






-  






-  






-  






-  






(2,491)






(2,491)




Other comprehensive loss






-  






-  






-  






-  






-  






(55)






-  






(1,762)






(1,817)




Total comprehensive loss






-  






-  






-  






-  






-  






(55)






-  






(4,253)






(4,308)




Dividends paid






-  






-  






-  






-  






-  






-  






-  






(1,362)






(1,362)




At 30th April, 2020






1,840 






901 






2,815 






6,055 






1,629 






224 






(3,059)






19,723 






30,128 




Profit for the year






-  






-  






-  






-  






-  






-  






-  






1,177 






1,177 




Other comprehensive (loss)/income






-  






-  






-  






-  






-  






(38)






-  






983 






945 




Total comprehensive (loss)/income






-  






-  






-  






-  






-  






(38)






-  






2,160 






2,122 




Dividends paid 






-  






-  






-  






-  






-  






-  






-  






(578)






(578)




Purchase of own shares 






-  






-  






-  






-  






-  






-  






(636)






-  






(636)




Cancellation of shares






(56)






56 






-  






-  






-  






-  






906 






(906)






-  




At 30th April, 2021






1,784 






957 






2,815 






6,055 






1,629 






186 






(2,789)






20,399 






31,036 




(b) Company












































































At 27th April, 2019






1,840 






901 






7,620 






-  






1,629 






-  






(3,059)






17,222 






26,153 




Profit for the year






-  






-  






-  






-  






-  






-  






-  






1,366 






1,366 




Other comprehensive loss






-  






-  






-  






-  






-  






-  






-  






(1,608)






(1,608)




Total comprehensive loss






-  






-  






-  






-  






-  






-  






-  






(242)






(242)




Dividends paid






-  






-  






-  






-  






-  






-  






-  






(1,362)






(1,362)




At 30th April, 2020






1,840 






901 






7,620 






-  






1,629 






-  






(3,059)






15,618 






24,549 




Profit for the year






-  






-  






-  






-  






-  






-  






-  






1,548 






1,548 




Other comprehensive income






-  






-  






-  






-  






-  






-  






-  






899 






899 




Total comprehensive income






-  






-  






-  






-  






-  






-  






-  






2,447 






2,447 




Dividends paid 






-  






-  






-  






-  






-  






-  






-  






(578)






(578)




Purchase of own shares






-  






-  






-  






-  






-  






-  






(636)






-  






(636)




Cancellation of shares






(56)






56 






-  






-  






-  






-  






906 






(906)






-  




At 30th April, 2021






1,784 






957 






7,620 






-  






1,629 






-  






(2,789)






16,581 






25,782 



 




 



Consolidated and company statements of financial position




At 30th April, 2021












































Group






Company












2021






2020






2021






2020












£'000






£'000






£'000






£'000




ASSETS




































Non-current assets




































Property, plant, and equipment






19,113 






20,111 






935 






1,121 




Right-of-use assets






530 






1,214 






5,486 






5,943 




Intangible assets






3,558 






4,140 






 -  






 -  




Investments in subsidiaries






 -  






 -  






17,313 






18,036 




Investment in joint venture






36 






 -  






 -  






 -  




Deferred income tax asset






1,606 






1,875 






1,600 






1,875 












24,843 






27,340 






25,334 






26,975 




Current assets




































Inventories






12,423 






15,857 






1,498 






1,543 




Trade and other receivables






9,369 






4,589 






16,135 






15,433 




Contract assets






1,998 






 -  






 -  






 -  




Income tax receivable






194 






719 






141 






139 




Prepayments






2,010 






1,775 






543 






296 




Cash and cash equivalents






17,390 






16,125 






943 






 -  




Restricted cash held in Escrow






6,165 






 -  






 -  






 -  












49,549 






39,065 






19,260 






17,411 










































TOTAL ASSETS






74,392 






66,405 






44,594 






44,386 










































EQUITY AND LIABILITIES




































Equity




































Share capital






1,784 






1,840 






1,784 






1,840 




Capital redemption reserve






957 






901 






957 






901 




Other reserves






2,815 






2,815 






7,620 






7,620 




Revaluation reserve






6,055 






6,055 






 -  






 -  




Special reserve






1,629 






1,629 






1,629 






1,629 




Currency translation reserve






186 






224 






 -  






 -  




Treasury shares






(2,789)






(3,059)






(2,789)






(3,059)




Retained earnings






20,399 






19,723 






16,581 






15,618 




TOTAL EQUITY SHAREHOLDERS' FUNDS






31,036 






30,128 






25,782 






24,549 




Non-current liabilities




































Defined benefit pension liability






7,095 






8,563 






7,095 






8,563 




Deferred income tax liability






1,553 






1,641 






 -  






 -  




Lease liabilities






380 






893 






5,214 






5,609 












9,028 






11,097 






12,309 






14,172 




Current liabilities




































Bank overdraft






 -  






 -  






 -  






391 




Trade and other payables






12,410 






11,309 






5,234 






3,854 




Contract liabilities






21,192 






13,370 






874 






1,037 




Income tax payable






561 






165 






 -  






 -  




Lease liabilities






165 






336 






395 






383 












34,328 






25,180 






6,503 






5,665 










































TOTAL EQUITY AND LIABILITIES






74,392 






66,405 






44,594 






44,386 



 




 



Consolidated and company cash flow statements








For the year ended 30th April, 2021












































Group






Company












2021






2020






2021






2020












£'000






£'000






£'000






£'000










































Profit/(loss) before taxation 






1,592 






(3,253)






92 






(1,216)




Adjustments to reconcile profit before taxation to net cash inflow/(outflow) from operating activities
































Past service pension costs






205 






  -  






205 






  -  




Depreciation charge of owned assets and right-of-use assets






1,666 






1,671 






895 






1,001 




Amortisation charge






237 






360 






  -  






  -  




Impairment of goodwill






348 






  -  






  -  






  -  




Write off of acquired goodwill






8 






271 






  -  






  -  




Profit on sale of fixed assets






(74)






(104)






(61)






(93)




Share of net profit of joint venture






(28)






  -  






  -  






  -  




Termination of lease






(7)






  -  






  -  






  -  




Finance costs






222 






134 






366 






412 




Foreign exchange gains






516 






10 






  -  






  -  




Decrease/(increase) in inventories






3,377 






(1,445)






44 






(81)




(Increase)/decrease in receivables






(6,834)






3,019 






37 






4,057 




(Increase)/decrease in prepayments






(237)






25 






(246)






3 




Increase/(decrease) in payables






1,162 






(1,021)






1,296 






(3,462)




Increase/(decrease) in progress payments






7,824 






(1,611)






(163)






571 




Pension fund payments






(600)






(600)






(600)






(600)




Cash generated from/(invested in) operating activities






9,377 






(2,544)






1,865 






592 




Net interest (paid)/received






(52)






66 






(49)






(59)




Taxation received/(paid)






460 






(848)






  -  






30 




Net cash inflow/(outflow) from operating activities






9,785 






(3,326)






1,816 






563 










































Investing activities




































Payments for acquisitions, net of cash acquired






(89)






(1,178)






  -  






  -  




Dividends received from subsidiaries






  -  






  -  






1,498 






1,895 




Purchase of property, plant, and equipment






(781)






(721)






(268)






(409)




Proceeds on disposal of property, plant, and equipment






97 






128 






62 






101 




Increase in cash held in the Escrow account maturing in more than 90 days






(6,165)






  -  






  -  






  -  




Net cash (outflow)/inflow from investing activities






(6,938)






(1,771)






1,292 






1,587 




Financing activities




































Purchase of own shares






(636)






  -  






(636)






  -  




Lease payments






(327)






(268)






(560)






(597)




Dividends paid






(578)






(1,362)






(578)






(1,362)




Net cash outflow from financing activities






(1,541)






(1,630)






(1,774)






(1,959)




Increase/(decrease) in cash and cash equivalents






1,306 






(6,727)






1,334 






191 




Opening cash and cash equivalents/(bank overdraft)






16,125 






22,886 






(391)






(582)




Exchange differences on cash and cash equivalents






(41)






(34)






  -  






  -  




Closing cash and cash equivalents/(bank overdraft)






17,390 






16,125 






943 






(391)



 
The financial information set out above does not constitute the Company's statutory accounts for the periods ended 30th April, 2021 or 30th April, 2020  but is derived from those accounts. Statutory accounts for 2020 have been delivered to the Registrar of Companies, and those for 2021 will be delivered following the Company's Annual General Meeting. The auditors have reported on those accounts; their reports were unqualified and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.




 



1.     Segment information










































































































































































The following table presents revenue and profit and certain assets and liability information regarding the Group's divisions for the years ended 30th April, 2021 and 30th April, 2020. The reporting format is determined by the differences in manufacture and services provided by the Group. The 'Defence' division is engaged in the design, manufacture, and service of defence equipment. The 'Forgings' division is engaged in the manufacture of forgings. The 'Petrol Station Superstructures' division is engaged in the design, manufacture, construction, branding, maintenance, and restyling of petrol station superstructures. The 'Corporate Branding' division is engaged in the design, manufacture, installation, and service of corporate brandings. 


























































































Management monitors the operating results of its business units separately for the purpose of making decisions about resource allocation and performance assessment. Group financing (including finance costs and finance revenue) and income taxes are managed on a group basis and are not allocated to operating segments. 



 











'Defence'






'Forgings'






'Petrol Station






'Corporate






Total












































Superstructures'






Branding'




























2021






2020






2021






2020






2021






2020






2021






2020






2021






2020












£'000






£'000






£'000






£'000






£'000






£'000






£'000






£'000






£'000






£'000




Segmental revenue




















































































Total revenue






27,078 






23,464 






9,970 






11,482 






11,774 






12,296 






12,972 






14,420 






61,794 






61,662 




Revenue from other segments






-  






-  






-  






-  






(145)






(386)






(110)






(123)






(255)






(509)




Revenue from external customers






27,078 






23,464 






9,970 






11,482 






11,629 






11,910 






12,862 






14,297 






61,539 






61,153 


























































































Segment result




















































































Operating profit/(loss)






2,570 






(289)






425 






(340)






448 






3 






(1,657)






(2,493)






1,786 






(3,119)




Share of net profit of joint venture






































































28 






-  




Net finance costs






































































(222)






(134)




Profit/(loss) before taxation






































































1,592 






(3,253)




Taxation






































































(415)






762 




Profit/(loss) for the year






































































1,177 






(2,491)


























































































Segmental assets




















































































Assets attributable to segments






35,414 






26,666 






4,066 






3,570 






8,492 






8,382 






8,468 






10,740 






56,440 






49,358 




Unallocated assets*






































































17,952 






17,047 




Total assets






































































74,392 






66,405 


























































































Segmental liabilities




















































































Liabilities attributable to segments






24,795 






16,639 






2,445 






1,285 






2,970 






2,274 






3,510 






4,922 






33,720 






25,120 




Unallocated liabilities*






































































9,636 






11,157 




Total liabilities






































































43,356 






36,277 


























































































Other segmental information




















































































Capital expenditure






440 






80 






24 






62 






131 






293 






186 






286 






781 






721 




Depreciation






176 






222 






545 






620 






377 






346 






263 






235 






1,361 






1,423 




Amortisation






-  






-  






-  






-  






55 






180 






182 






180 






237 






360 




Impairment






-  






-  






-  






-  






-  






-  






348 






-  






348 






-  



 



* Unallocated assets include certain fixed assets (including all UK properties), current assets and deferred income tax assets. Unallocated liabilities include the defined pension benefit scheme liability, the deferred income tax liability, and certain current liabilities.


























































































Assets and liabilities attributable to segments comprise the assets and liabilities of each segment adjusted to reflect the elimination of the cost of investment in subsidiaries and the provision of financing loans provided by MS INTERNATIONAL plc. 


























































































Revenue between segments is determined on an arm's length basis. Segment results, assets, and liabilities include items directly attributable to the segment as well as those that can be allocated on a reasonable basis. 


























































































Geographical analysis


















































































































































The following table presents revenue and expenditure and certain assets and liabilities information by geographical segment for the years ended 30th April, 2021 and 30th April, 2020. The Group's geographical segments are based on the location of the Group's assets.




























United Kingdom






Europe






Americas






Total




























2021






2020






2021






2020






2021






2020






2021






2020




























£'000






£'000






£'000






£'000






£'000






£'000






£'000






£'000


























































































External revenue by origin






















41,191 






39,191 






12,987 






14,538 






7,361 






7,424 






61,539 






61,153 




Non-current assets






















17,373 






17,803 






3,706 






5,017 






3,764 






4,520 






24,843 






27,340 




Current assets






















39,457 






29,004 






6,899 






8,378 






3,193 






1,683 






49,549 






39,065 




Liabilities






















32,516 






30,473 






3,729 






5,051 






7,111 






753 






43,356 






36,277 




Capital expenditure






















644 






477 






137 






244 






-  






-  






781 






721 


























































































Revenue disaggregated by destination is shown as follows:




























































2021






2020




























































£'000






%






£'000






%


























































































United Kingdom






















































22,259 






36%






21,036 






34%




Europe






















































26,574 






43%






30,748 






50%




USA & South America






















































7,361 






12%






8,401 






14%




Rest of World






















































5,345 






9%






968 






2%


























































































Total revenue






















































61,539 






100%






61,153 






100%













































The Group's largest customer, which is reported in the 'Defence' division, contributed 14.9% to the Group's revenue (2020: 20.7% in the 'Defence' division). Only one other customer, also in the 'Defence' division, contributed more than 10% to the Group's revenue with a contribution of 11.3% (2020: 13.0% in the 'Defence' division). 
 



2.     Employee information










































The average number of employees, including executive directors, during the year was as follows:




























2021






2020












Number






Number


























Production






243 






252 




Technical






72 






66 




Distribution






32 






45 




Administration






96 






85 












443 






448 


























(a)   Staff costs










































Including executive directors, employment costs were as follows:




























2021






2020












£'000






£'000


























Wages and salaries






17,420 






17,133 




Coronavirus job retention scheme income






(1,690)






(240)




Social security costs






3,263 






2,629 




Pension costs






557 






870 




Share options expense






29 






  -  












19,579 






20,392 


























The Coronavirus job retention scheme income has been received in the following countries:




























2021






2020












£'000






£'000


























UK






313 






240 




The Netherlands






1,113 






  -  




USA






254 






  -  




Poland






10 






  -  












1,690 






240 
















































(b)   Directors' emoluments




























2021






2020












£'000






£'000


























Aggregate directors' emoluments






1,570 






1,300 




Pension contributions






42 






33 




Share option expense






13 






  -  












1,625 






1,333 



 



3.     (a)   Taxation










































The charge for taxation comprises:




























2021






2020












£'000






£'000




Current tax




















United Kingdom corporation tax






410 






(510)




Adjustments in respect of previous years






25 






165 




Foreign corporation tax






30 






(203)




Group current tax expense/(credit)






465 






(548)


























Deferred tax




















Origination and reversal of temporary differences






(40)






(95)




Adjustments in respect of previous years






(10)






(153)




Difference in applicable tax rate






  -  






34 




Group deferred tax credit






(50)






(214)




Total tax expense/(credit) on profit/(loss)






415 






(762)
















































Tax relating to items charged or credited to other comprehensive income:










































Deferred tax charged/(credited) through other comprehensive income




















Deferred tax on measurement gains on pension scheme current year 






(230)






545 




Deferred tax on revaluation surplus on land and buildings






  -  






(110)




Deferred tax in the Consolidated statement of comprehensive income






(230)






435 
















































(b)   Factors affecting the tax charge for the year



















 



The tax charge/(credit) assessed for the year is higher than (2020: lower than) the standard rate of corporation tax in the UK of 19% (2020 - 19%). The differences are explained below:
























 












2021






2020


 












£'000






£'000


 
























 




Profit/(loss) before tax






1,592 






(3,253)


 




Profit/(loss) multiplied by standard rate of corporation tax of 19% (2020 - 19%)






302 






(618)


 
























 




Effects of:


















 




Expenses not deductible for tax purposes






(164)






(420)


 




Adjustments in respect of overseas tax rates






262 






230 


 




Current tax adjustment in respect of previous years






25 






165 


 




Deferred tax adjustment in respect of previous years






(10)






(153)


 




Deferred tax adjustment in respect of different applicable rates






  -  






34 


 




Total taxation expense/(credit) for the year






415 






(762)


 
























 




(c)   Factors affecting future tax charge


















 




The March 2021 Budget announced an increase in the UK standard rate of corporation tax to 25% from 1st April, 2023. The legislation received Royal Assent on 10th June, 2021 so was substantively enacted after the reporting date. Deferred tax at 30th April, 2021 has therefore been provided at 19%. 


 


























The overall effect of the forthcoming increase in the main UK corporation tax rate to 25%, had it been enacted at the reporting date, would have led to an increase in the deferred tax asset of approximately £510,000 and an increase in the deferred tax liability of approximately £450,000. The increase in the main rate of UK corporation tax from April 2023 is unlikely to have a material effect on the annual tax charge in the Group's accounts arising from the reversal of timing differences recognised through the consolidated income statement.


 


























Deferred tax in relation to intangibles recognised on the acquisition of 'MSI-Sign Group B.V.' has been provided at 25%, being the main corporation tax rate in The Netherlands.


 


















 



4.     Earnings per share










































The calculation of basic earnings per share of 7.2p (2020 - loss per share of 15.1p) is based on the profit for the year attributable to equity holders of the parent of £1,177,000 (2020 - loss of £2,491,000) and on a weighted average number of ordinary shares in issue of 16,342,816 (2020 - 16,504,491). At 30th April, 2020 there were 380,000 (2020 - 400,000) potentially dilutive shares on option with a weighted average effect of 391,667 (2020 - 400,000) giving a diluted earnings per share of 7.0p (2020 - loss per share of 15.1p). 


































2021






2020


























Number of ordinary shares in issue at start of the year 






18,396,073 






18,396,073 




Cancellation of ordinary shares during the year






(555,000)






  -  




Number of ordinary shares in issue at the end of the year






17,841,073 






18,396,073 


























Weighted average number of shares in issue






18,234,198 






18,396,073 




Less weighted average number of shared held in the ESOT






(245,048)






(245,048)




Less weighted average number of shares purchased by the Company






(1,646,334)






(1,646,334)




Weighted average number of shares to be used in basic EPS calculation






16,342,816 






16,504,691 




Weighted average number of the 380,000 (2020 - 400,000) potentially dilutive shares






391,667 






400,000 




Weighted average diluted shares






16,734,483 






16,904,691 


























Profit/(loss) for the year attributable to equity holders to the parent in £






1,177,000 






(2,491,000)




Basic earnings/(loss) per share






7.2p






(15.1p)




Diluted earnings/(loss) per share






7.0p






(15.1p)


























The prior year diluted loss per share is the same as the basic loss per share as the impact of potential dilutive shares is anti-dilutive and therefore not recognised. 
 
















































5.    Dividends paid and proposed






2021






2020












£'000






£'000




Declared and paid during the year




















Final dividend for 2020: 1.75p  (2019 - 6.50p)






289 






1,073 




Interim dividend for 2021: 1.75p (2020 - 1.75p)






289 






289 












578 






1,362 


























Proposed for approval by shareholders at the AGM 




















Final dividend for 2021: 6.5p (2020 - 1.75p)






1,073 






289 



 



6.   Trade and other receivables












































































Group






Company




























2021






2020






2021






2020




























£'000






£'000






£'000






£'000


























































Trade receivables (net of allowance for expected credit losses)






8,764 






        4,413 






2,184 






932 




Amounts owed by subsidiary undertakings






-  






                - 






13,872 






     14,422 




Amounts owed by joint venture






















150 






               - 






-  






              - 




Other receivables






















455 






176  






79 






79  




























   9,369 






       4,589 






   16,135 






 15,433 


























































(a)   Trade receivables are denominated in the following currencies:




























































Group






Company




























2021






2020






2021






2020




























£'000






£'000














£'000


























































Sterling






















6,112 






1,551 






1,675 






838 




Euro






















1,692 






2,319 






509 






94 




US dollar






















695 






349 






-  






-  




Other currencies






















265 






194 






-  






-  




























8,764  






4,413  






2,184  






932  


























































Trade receivables are non-interest bearing and are generally on 30 day terms and are shown net of provision for impairment. The aged analysis of trade receivables after impairment is as follows:


























































Group






Total






Not past due






< 30 days






30-60 days






60-90 days






> 90 days












£'000






£'000






£'000






£'000






£'000






£'000




2021






8,764  






7,268  






1,381  






102  






28  






(15) 




2020






4,413  






2,745  






343  






211  






327  






787  


























































As at 30th April, 2021 trade receivables at a nominal value of £43,000 (2020 - £109,000) were impaired and fully provided. Bad debts of £81,000 (2020 - £62,000) were recovered and bad debts of £16,000 (2020 - £68,000) were incurred.


























































Company






Total






Not past due






< 30 days






30-60 days






60-90 days






> 90 days












£'000






£'000






£'000






£'000






£'000






£'000




2021






2,184  






2,033  






122  






28  






-  






1  




2020






932  






865  






54  






3  






7  






3  


























































As at 30th April, 2021 trade receivables at a nominal value of £11,000 (2020 - £73,000) were impaired and fully provided. Bad debts of £69,000 (2020 - £33,000) were recovered and bad debts of £7,000 (2020 - £55,000) were incurred.


























































(c)   Intercompany receivables










































































































All amounts due from Group companies are repayable on demand and are not charged interest. The majority of intercompany balances are to group entities with liquid assets and are capable of being repaid on demand. There has been no impairment recognised on intercompany receivables (2020 - £nil). 


























































There are loans to 'MS INTERNATIONAL Estates Limited', which although repayable on demand, are supported by properties which will not be immediately realisable. The directors have assessed the likelihood of default and the loss in the event of default as well as the balance at the reporting date and conclude that there is no material impairment of the receivable.










The amounts receivable at the reporting date can be categorised as:




































































2021






2020












































£'000






£'000


























































Amounts due from companies backed by liquid assets






















7,587 






7,530 




Amounts due from 'MS INTERNATIONAL Estates Limited'
 






















6,285 






6,892 












































13,872 






14,422 



 



7.   Cash and cash equivalents / bank overdraft












































































Group






Company




























2021






2020






2021






2020




























£'000






£'000






£'000






£'000


























































Cash at bank and in hand






















17,390 






16,125 






943 






 -  




Bank overdraft






















  -  






  -  






  -  






(391)




Cash and cash equivalents






















         17,390 






          16,125 






943 






(391)




Restricted cash held in Escrow - maturing in more than 90 days














           6,165 






                    - 






 -  






 -  




Total cash 






















         23,555 






          16,125 






              943 






(391)


























































The balance held in Escrow provides security to Lloyds Bank plc in respect of any guarantees, indemnities, and performance bonds given by the group in the ordinary course of business. 


























































8.   Net funds










































































































Analysis of net funds






















Group






Company




























2021






2020






2021






2020




























£'000






£'000






£'000






£'000




Cash and cash equivalents






















17,390 






16,125 






943 






  -  




Bank overdraft






















  -  






  -  






  -  






(391)




Restricted cash held in Escrow






















6,165 






  -  






  -  






  -  




Lease liabilities






















(545)






(1,229)






(5,609)






(5,992)




























23,010 






14,896 






(4,666)






(6,383)


























































Group movement in net funds












































































Cash/bank overdraft






Restricted cash held in Escrow






Lease liabilities






Total


























































Net funds as at 27th April, 2019






















22,886 






  -  






  -  






22,886 




Recognised on adoption of IFRS 16






















  -  






  -  






(781)






(781)




Cash flows






















(6,727)






  -  






268 






(6,459)




Foreign exchange adjustments






















(34)






  -  






6 






(28)




Leases on acquisition






















  -  






  -  






(501)






(501)




New leases






















  -  






  -  






(185)






(185)




Other changes






















  -  






  -  






(36)






(36)




Net funds as at 30th April, 2020


 
 


















16,125 






  -  






(1,229)






14,896 




Cash flows






















1,306 






6,165 






327 






7,798 




Foreign exchange adjustments






















(41)






  -  






(16)






(57)




Lease cancellation






















  -  






  -  






402 






402 




Other changes






















  -  






  -  






(29)






(29)




Net funds as at 30th April, 2021






















17,390 






6,165 






(545)






23,010 


























































Company movement in net funds












































































Cash/bank overdraft






 Restricted cash held in Escrow 






Lease liabilities






Total


























































Net funds as at 27th April, 2019






















(582)






  -  






  -  






(582)




Recognised on adoption of IFRS 16






















  -  






  -  






(6,400)






(6,400)




Cash flows






















191 






  -  






597 






788 




Other changes






















  -  






  -  






(189)






(189)




Net funds as at 30th April, 2020






















(391)






  -  






(5,992)






(6,383)




Cash flows






















1,334 






  -  






560 






1,894 




Other changes






















  -  






  -  






(177)






(177)




Net funds as at 30th April, 2021






















943 






  -  






(5,609)






(4,666)

























































 



9.   Reserves










































































































Share capital




















































The balance classified as share capital includes the nominal value on issue of the Company's equity share capital, comprising 10p ordinary shares.


























































Capital redemption reserve




















































The balance classified as capital redemption reserve represents the nominal value of issued share capital of the Company, repurchased.


























































Other reserves




















































Following the transfer of assets held at valuation by the Company to a subsidiary company, a reserve has been created which is non-distributable. This is equal to the revaluation reserve previously arising.


























































Additionally, it includes the non-distributable retained reserve for the revaluation reserve previously showing in the Company for properties now transferred to other members of the Group.


























































Revaluation reserve




















































The asset revaluation reserve is used to record increases in the fair value of land and buildings and decreases to the extent that such decrease relates to an increase on the same assets previously recognised in equity. 


























































Special reserve




















































The special reserve is a distributable reserve created following the cancellation of a share premium account by way of court order in March 1993. 


























































Currency translation reserve




















































The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements of foreign subsidiaries. It is also used to record the effect of hedging net investments in foreign operations.


























































Treasury shares




























































































2021






2020












































£'000






£'000




Employee Share Ownership Trust






































100 






100 




Shares in treasury (see below)






































2,689 






2,959 












































2,789 






3,059 


























































During 1991 the Company established an Employee Share Ownership Trust ("ESOT"). The trustee of the ESOT is Appleby Trust (Jersey) Ltd, an independent company registered in Jersey. The ESOT provides for the issue of options over ordinary shares in the Company to Group employees, including executive directors, at the discretion of the Remuneration Committee.


























































The trust has purchased an aggregate 245,048 (2020 - 245,048) ordinary shares, which represents 1.5% (2020 - 1.3%) of the issued share capital of the Company at an aggregate cost of £100,006. The market value of the shares at 30th April, 2021 was £380,000 (2020 - £338,000). The Company has made payments of £nil (2020 - £nil) into the ESOT bank accounts during the period. During the year, no options have been granted over shares (2020 - 1,575,000). Details of the outstanding share options for directors are included in the Directors' remuneration report.


























































The assets, liabilities, income, and costs of the ESOT have been incorporated into the Company's financial statements. Total ESOT costs charged to the income statement in the period amounts to £3,000 (2020 - £8,000). During the year, no options on shares were exercised (2020 - nil) and no shares were purchased (2020 - nil).


























































On 11th December, 2013 the Company purchased 1,000,000 of its shares with a further 646,334 shares being purchased on 30th January, 2014. 




On 15th January, 2021 the Company purchased 555,000 of its own 10p ordinary shares for a consideration of £636,000. The shares were cancelled on the same date at a weighted average price of £163.33 per share, totalling £906,000. 


























































The Company made the following purchases and cancellations of its own 10p ordinary shares to be held in Treasury: 












































Number






£'000




Purchase of 1,000,000 shares from the Group's pension scheme on 11th December, 2013






1,000,000 






1,722 




Purchase of 646,334 shares on 30th January, 2014






































646,334 






1,237 




Purchase of 555,000 shares on 15th January, 2021






































555,000 






636 




Consideration paid for purchase of own shares






































2,201,334 






3,595 




Cancellation of 555,000 shares at weighted average rate






(555,000)






(906)




Net value of treasury shares






































1,646,334 






2,689 

























































 

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