REG - Porvair PLC - Half yearly results <Origin Href="QuoteRef">PORV.L</Origin> - Part 2

PorvairAnnouncement

27/06/2016 07:05

- Part 2: For the preceding part double click  ID:nRSa2712Ca 


 
                                                                                           Level 1    Level 2    Level 3    Total  
                                                                                           £'000      £'000      £'000      £'000  
 Financial liabilities at fair value through profit or loss:-       Trading derivatives    -          (354)      -          (354)  
 Contingent consideration                                                                  -          -          (515)      (515)  
 Foreign exchange contracts used for hedging                                               -          (73)       -          (73)   
 At 31 May 2016                                                                            -          (427)      (515)      (942)  
                                                                                                                                   
 Financial liabilities at fair value through profit or loss:-       Trading derivatives    -          (64)       -          (64)   
 Deferred consideration                                                                    -          -          (56)       (56)   
 Foreign exchange contracts used for hedging                                               -          (90)       -          (90)   
 At 30 November 2015                                                                       -          (154)      (56)       (210)  
                                                                                                                                   
 
 
There were no transfers between levels during the period, and there were no
changes in valuation techniques in the period. 
 
Level 2 trading and hedging derivatives comprise forward foreign exchange
contracts. These forward foreign exchange contracts have been fair valued
using forward exchange rates that are quoted in an active market.  The effects
of discounting are generally insignificant for Level 2 derivatives. 
 
A summary of the movements in deferred and contingent consideration on
acquisitions contained in Level 3 is given below: 
 
                                           Eisenmann Metallurgical    Thomas Cain    Total  
                                           £'000                      £'000          £'000  
 At 1 December 2014                        (639)                      (285)          (924)  
 Cash paid in the period                   327                        163            490    
 Recognised in the income statement        -                          129            129    
 Foreign exchange movement                 (16)                       (7)            (23)   
 At 31 May 2015                            (328)                      -              (328)  
 
 
                                                       Fiber Ceramics    TEM Filter Company    Total    
                                                       £'000             £'000                 £'000    
 At 1 December 2015                                    (56)              -                     (56)     
 Purchase consideration additions in the period        -                 (3,377)               (3,377)  
 Cash paid in the period                               50                2,880                 2,930    
 Recognised in the income statement                    7                 -                     7        
 Foreign exchange movement                             (1)               (18)                  (19)     
 At 31 May 2016                                        -                 (515)                 (515)    
 
 
Details regarding the valuation and sensitivity of the contingent
consideration are disclosed in Note 9. 
 
The fair value of the following financial assets and liabilities approximate
their carrying amount: borrowings, trade and other receivables, other current
financial assets, cash and cash equivalents, and trade and other payables. 
 
12.          Provisions for other liabilities and charges 
 
                                                      Dilapidations    Warranty    Total  
                                                      £'000            £'000       £'000  
 At 1 December 2015                                   150              578         728    
 Charged to the consolidated income statement:                                            
 -       Unwinding of discount                        7                -           7      
 -       Warranty                                     -                1,821       1,821  
 At 31 May 2016                                       157              2,399       2,556  
 
 
The provisions, all of which are non-current, arise from a discounted
dilapidations provision for leased property, which is expected to be utilised
in 2023, and sale warranties, which are utilisable before 2020. 
 
13.          Exchange rates 
 
Exchange rates for the US dollar and Euro during the period were: 
 
            Average rate to 31 May 16  Average rate to 31 May 15  Closing rate at 31 May 16  Closing rate at 30 Nov 15  
            Unaudited                  Unaudited                  Unaudited                  Unaudited                  
 US dollar  1.45                       1.53                       1.46                       1.51                       
 Euro       1.32                       1.34                       1.31                       1.43                       
 
 
14.          Revenue at constant currency estimation 
 
                                  2016    2015    Growth  
 Metals Filtration                £m      £m      %       
 Revenue at constant currency*    14.4    15.0    (4)     
 Exchange                         2.4     0.7             
 Revenue as reported              16.8    15.7    7       
                                                          
 Microfiltration                                          
 Revenue at constant currency*    35.1    30.0    17      
 Exchange                         0.2     0.6             
 Revenue as reported              35.3    30.6    15      
                                                          
 Group                                                    
 Revenue at constant currency*    49.5    45.0    10      
 Exchange                         2.6     1.3             
 Revenue as reported              52.1    46.3    13      
 
 
Revenue at constant currency is based upon fixed exchange rates in both years
of $1.6:£ and E1.4:£. 
 
15.          Seasonality 
 
The results for the six months ended 31 May 2016 are impacted by a lower
number of working days in the first six months of the year than in the second
half of the year. 
 
16.          Basis of preparation 
 
Porvair plc is a public limited company registered in the UK and listed on the
London Stock Exchange. 
 
This unaudited condensed half-yearly consolidated financial information for
the six months ended 31 May 2016 has been prepared in accordance with the
Disclosure and Transparency Rules ('DTR') of the Financial Conduct Authority
and with IAS 34, 'Interim financial reporting' as adopted by the European
Union.  The condensed half-yearly consolidated financial information should be
read in conjunction with the annual financial statements for the year ended 30
November 2015, which have been prepared in accordance with IFRSs as adopted by
the European Union. 
 
The accounting policies adopted are consistent with those of the annual
financial statements for the year ended 30 November 2015, as described in
those financial statements.  A number of amendments to IFRSs became effective
for the financial year beginning 1 December 2015.  However, the Group did not
have to change its accounting policies or make material retrospective
adjustments as a result of adopting these new standards. 
 
Taxes on income in the interim period are accrued using the tax rate that
would be applicable to expected total annual earnings. 
 
This condensed half-yearly consolidated financial information has been
prepared on a going concern basis under the historical cost convention, as
modified by the revaluation of certain current assets, financial assets and
financial liabilities held for trading and derivative contracts, which are
held at fair value. 
 
The preparation of condensed half-yearly consolidated financial information in
conformity with generally accepted accounting principles requires the use of
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the condensed half-yearly consolidated financial
information and the reported amounts of revenues and expenses during the
reporting period. Although these estimates are based on management's best
knowledge of the amount, event or actions, actual results may ultimately
differ from those estimates.  In preparing the condensed interim financial
statements, the significant judgements made by management in applying the
Group's accounting policies and the key sources of estimation uncertainty were
the same as those applied to the consolidated financial statements for the
year ended 30 November 2015, with the exception of changes in estimates that
are required in determining the provision for income taxes. 
 
After having made appropriate enquiries, including a review of progress
against the Group's budget for 2016, its medium term plans and taking into
account the banking facilities available until January 2018, the Directors
have a reasonable expectation that the Group has adequate resources to
continue in operational existence for at least twelve months from the date of
approval of the condensed half yearly consolidated financial information. 
Accordingly, they continue to adopt the going concern basis in preparing this
condensed half-yearly consolidated financial information. 
 
This condensed half-yearly consolidated financial information and the
comparative figures does not constitute full accounts within the meaning of
Section 434 of the Companies Act 2006. Statutory accounts for the year ended
30 November 2015, which were approved by the Board of Directors on 22 January
2016, and which include an unqualified audit report, no emphasis of matter
paragraph and no statements under sections 498(2) or (3) of the Companies Act
2006, have been delivered to the Registrar of Companies.  This condensed
half-yearly consolidated financial information has been reviewed, not
audited. 
 
The condensed half-yearly consolidated financial information does not include
all financial risk management information and disclosures required in the
annual financial statements; it should be read in conjunction with the Group's
annual financial statements for the year ended 30 November 2015.  There have
been no changes in any risk management policies since the year end. 
 
This report will be available at Porvair plc's registered office at 7 Regis
Place, Bergen Way, King's Lynn, PE30 2JN and on the Company's website
www.porvair.com. 
 
17.          Adoption of FRS 101 'Reduced disclosure framework - Disclosure
exemptions from EU-adopted IFRS for qualifying entities' 
 
Following the publication of FRS 100, 'Application of financial reporting
requirements', by the Financial Reporting Council, Porvair plc is required to
change its accounting framework for its entity financial statements, which is
currently UK GAAP, for its financial year commencing 1 December 2015.  The
Board considers that it is in the best interests of the Group for Porvair plc
to adopt FRS 101 'Reduced disclosure framework - Disclosure exemptions from
EU-adopted IFRS for qualifying entities'. 
 
A list of IFRS requirements where there are exemptions available under FRS 101
which are to be taken in preparation of the financial statements of the
entity, has been set out below: 
 
•    paragraphs 45(b) and 46 to 52 of IFRS 2 Share-based payment (details of
the number and weighted-average exercise prices of share options and how the
fair value of goods or services received was determined); 
 
•    paragraphs 62, B64(d), B64(e), B64(g), B64(h), B64(j) to B64(m), B64(n)
(ii), B64(o)(ii), B64(p), B64(q)(ii), B66 and B67 of IFRS 3 Business
Combinations; 
 
•    paragraph 33(c) of IFRS 5 Non-current Assets Held for Sale and
Discontinued Operations; 
 
•    IFRS 7 Financial Instruments: Disclosures; 
 
•    paragraphs 91 to 99 of IFRS 13 Fair Value Measurement (disclosure of
valuation techniques and inputs used for fair value measurement of assets and
liabilities); 
 
•    paragraph 38 of IAS 1 Presentation of Financial Statements to present
comparative information in respect of: 
 
̵ paragraph 79(a)(iv) of IAS 1; 
 
̵ paragraph 73(e) of IAS 16 Property, Plant and Equipment; 
 
̵ paragraph 118(e) of IAS 38 Intangible Assets (reconciliations between the
carrying amount at the beginning and end of the period); 
 
•    paragraphs 10(d) (statement of cash flows), 10(f) (statement of financial
position as at the beginning of the preceding period when an entity applies an
accounting policy retrospectively or makes a retrospective restatement of
items in its financial statements, or when it reclassifies items in its
financial statements), 16 (statement of compliance with all IFRSs), 38A
(requirement for minimum of two primary statements, including cash flow
statements), 38B-D (additional comparative information), 40A-D (requirements
for a third statement of financial position), 111 (cash flow statement
information) and 134 to 136 (capital management disclosures) of IAS 1
Presentation of Financial Statements; 
 
•    IAS 7 Statement of Cash Flows; 
 
•    paragraphs 30 and 31 of IAS 8 Accounting Policies, Changes in Accounting
Estimates and Errors (requirement for the disclosure of information when an
entity has not applied a new IFRS that has been issued but is not yet
effective); 
 
•    paragraph 17 of IAS 24 Related Party Disclosures (key management
compensation); 
 
•    IAS 24 Related Party Disclosures to disclose related party transactions
entered into between two or more members of a group, provided that any
subsidiary which is a party to the transaction is wholly owned by such a
member; and 
 
•    paragraphs 130(f)(ii), 130(f)(iii), 134(d) to 134(f) and 135(c) to 135
(e) of IAS 36 Impairment of Assets (disclosures when the recoverable amount is
fair value less costs of disposal, assumptions involved in estimating
recoverable amounts of cash generating units containing goodwill or intangible
assets with indefinite useful lives and management's approach to determining
these amounts). 
 
A shareholder or shareholders holding in aggregate 5% or more of the total
allotted shares in Porvair plc can serve objections to the use of the
disclosure exemptions on Porvair plc, in writing, to its registered office (7
Regis Place, Bergen Way, King's Lynn, Norfolk PE30 2JN) no later than 26
August 2016. 
 
Statement of directors' responsibilities 
 
The Directors confirm that this condensed half-yearly consolidated financial
information has been prepared in accordance with IAS 34 as adopted by the
European Union and that the interim management report herein includes a fair
review of the information required by DTR 4.2.7 and DTR 4.2.8, namely: 
 
·          an indication of important events that have occurred during the
first six months of the year, their impact on the condensed half-yearly
consolidated financial information and a description of the principal risks
and uncertainties for the remaining six months of the financial year; and 
 
·          material related party transactions in the first six months of the
year and any material changes in the related party transactions described in
the last annual report. 
 
The Directors of Porvair plc are listed in the Porvair plc Annual Report for
the year ended 30 November 2015.  A list of current Directors is maintained on
the Porvair plc website www.porvair.com. 
 
By order of the board 
 
Ben Stocks 
 
Group Chief Executive 
 
Chris Tyler 
 
Group Finance Director 
 
24 June 2016 
 
Independent review report to Porvair plc 
 
Report on the condensed half-yearly consolidated financial information 
 
Our conclusion 
 
We have reviewed Porvair plc's condensed half-yearly consolidated financial
information (the "interim financial statements") in the half-yearly results of
Porvair plc for the 6 month period ended 31 May 2016. Based on our review,
nothing has come to our attention that causes us to believe that the interim
financial statements are not prepared, in all material respects, in accordance
with International Accounting Standard 34, 'Interim Financial Reporting', as
adopted by the European Union and the Disclosure Rules and Transparency Rules
of the United Kingdom's Financial Conduct Authority. 
 
What we have reviewed 
 
The interim financial statements comprise: 
 
·      the condensed consolidated balance sheet as at 31 May 2016; 
 
·      the condensed consolidated income statement and condensed consolidated
statement of comprehensive income for the period then ended; 
 
·      the condensed consolidated cash flow statement for the period then
ended; 
 
·      the condensed consolidated statement of changes in equity for the
period then ended; and 
 
·      the explanatory notes to the interim financial statements. 
 
The interim financial statements included in the half-yearly results have been
prepared in accordance with International Accounting Standard 34, 'Interim
Financial Reporting', as adopted by the European Union and the Disclosure
Rules and Transparency Rules of the United Kingdom's Financial Conduct
Authority. 
 
As disclosed in note 16 to the interim financial statements, the financial
reporting framework that has been applied in the preparation of the full
annual financial statements of the Group is applicable law and International
Financial Reporting Standards (IFRSs) as adopted by the European Union. 
 
Responsibilities for the interim financial statements and the review 
 
Our responsibilities and those of the directors 
 
The half-yearly results, including the interim financial statements, is the
responsibility of, and has been approved by, the directors. The directors are
responsible for preparing the half-yearly results in accordance with the
Disclosure Rules and Transparency Rules of the United Kingdom's Financial
Conduct Authority. 
 
Our responsibility is to express a conclusion on the interim financial
statements in the half-yearly results based on our review. This report,
including the conclusion, has been prepared for and only for the company for
the purpose of complying with the Disclosure Rules and Transparency Rules of
the United Kingdom's Financial Conduct Authority and for no other purpose.  We
do not, in giving this conclusion, accept or assume responsibility for any
other purpose or to any other person to whom this report is shown or into
whose hands it may come save where expressly agreed by our prior consent in
writing. 
 
What a review of interim financial statements involves 
 
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information
Performed by the Independent Auditor of the Entity' issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures. 
 
A review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing (UK and Ireland) and, consequently,
does not enable us to obtain assurance that we would become aware of all
significant matters that might be identified in an audit. Accordingly, we do
not express an audit opinion. 
 
We have read the other information contained in the half-yearly results and
considered whether it contains any apparent misstatements or material
inconsistencies with the information in the interim financial statements. 
 
PricewaterhouseCoopers LLP 
 
Chartered Accountants 
 
Cambridge 
 
24 June 2016 
 
a)    The maintenance and integrity of the Porvair plc website is the
responsibility of the directors; the work carried out by the auditors does not
involve consideration of these matters and, accordingly, the auditors accept
no responsibility for any changes that may have occurred to the interim
financial statements since they were initially presented on the website. 
 
b)    Legislation in the United Kingdom governing the preparation and
dissemination of financial statements may differ from legislation in other
jurisdictions. 
 
This information is provided by RNS
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