REG - Porvair PLC - Results for the year ended 30 November 2016 <Origin Href="QuoteRef">PORV.L</Origin> - Part 2
30/01/2017 07:06
- Part 2: For the preceding part double click ID:nRSd3769Va
Amounts due from contract customers included in other receivables 300 -
Amounts due to contract customers included in accruals and deferred income (8,208) (7,730)
Net amounts due to contract customers (7,908) (7,730)
Contract costs incurred plus recognised profits less recognised losses to date 44,854 35,160
Less: progress billings (52,762) (42,890)
Contracts in progress at 30 November (7,908) (7,730)
8. Borrowings
On 25 January 2013, the Group entered into five year banking facilities
sufficient for its foreseeable needs comprising a US $20 million revolving
credit facility, a £2.5 million amortising term loan (reduced to £nil at 30
November 2015) and a £2.5 million overdraft. At 30 November 2016, the Group
had $20 million of unused facilities (2015: $20 million of unused facilities)
and an unutilised overdraft facility of £2.5 million (2015: £2.5 million).
9. Provisions
Dilapidations Warranty Total
£'000 £'000 £'000
At 1 December 2015 150 578 728
Charged to the consolidated income statement:
Unwinding of discount 14 - 14
Warranty - 1,782 1,782
At 30 November 2016 164 2,360 2,524
10. Share capital and premium
Number of shares Ordinary shares Share premium account Total
Thousands £'000 £'000 £'000
At 1 December 2015 44,824 896 35,359 36,255
Issue of shares on exercise of share options 484 10 154 164
At 30 November 2016 45,308 906 35,513 36,419
In January 2016, 308,200 ordinary shares of 2 pence each were issued on the
exercise of Long Term Share Plan share options for a cash consideration of
£6,000. In July 2016, 25,000 ordinary shares of 2 pence each were issued on
exercise of EMI share options for a cash consideration of £18,000. In October
and November 2016, 150,928 ordinary shares of 2 pence each were issued on the
exercise of Save As You Earn share options for a cash consideration of
£140,000.
In February 2015, 441,000 ordinary shares of 2 pence each were issued on the
exercise of Long Term Share Plan share options for a cash consideration of
£9,000. In December 2014 and May 2015, 9,221 ordinary shares of 2 pence each
were issued on exercise of Save As You Earn share options for a cash
consideration of £10,000. In November 2015, 10,000 ordinary shares of 2 pence
each were issued on the exercise of EMI share options for a cash consideration
of £15,000.
The Group uses an Employee Benefit Trust (EBT) to purchase shares in the
Company to satisfy entitlements, granted since the Company's AGM in 2015,
under the Group's Long Term Incentive Plan and Save As You Earn schemes.
During the year the Group purchased 20,000 ordinary shares (2015: nil) of 2
pence for a total consideration of £77,000 (2015: £nil). The cost of the
shares held by the EBT is deducted from retained earnings. The EBT is
financed by a repayable on demand loan from the Group of £77,000 (2015: £nil).
As at 30 November 2016 the EBT held a total of 20,000 ordinary shares of 2
pence (2015: nil) at a cost of £77,000 (2015: £nil) and a market value of
£84,000 (2015: £nil).
11. Acquisition
On 4 December 2015 the Group, through its subsidiary Porvair Filtration Group,
Inc., purchased the trade and assets of TEM Filter Company. The trade is the
manufacture of specialist filters and is based in the USA. The total
consideration is $5,220,000 (£3,576,000); $4,350,000 (£2,880,000) was paid on
4 December 2015, with the balance being contingent and due for payment before
31 May 2017. The contingent consideration is estimated based on the forecast
performance of the acquired business in its first year of ownership by the
Group. At the time of acquisition this was expected to be $750,000
(£497,000). Based on the actual performance of the division, this amount is
estimated to be $870,000 (£696,000). The difference between the initial
assessment of contingent consideration and the revised estimate of $120,000
(£87,000) has been charged to the income statement in the year. The maximum
contingent consideration is $1,200,000 (£960,000). The direct costs of
acquisition, which were charged to the income statement, were $58,000
(£38,000). In the period since acquisition, the business has contributed
$3,691,000 (£2,678,000) of revenue and $916,000 (£665,000) of operating profit
to the Group results.
Total
£'000
Purchase consideration:
Cash paid 2,880
Contingent consideration provided 497
Original estimate of total purchase consideration 3,377
Fair value of net assets acquired (329)
Goodwill 3,048
Recognised amounts of identifiable assets acquired and liabilities assumed Fair value
£'000
Property plant and equipment 44
Non-compete agreement 66
Inventory 93
Trade receivables 162
Other working capital (net) (36)
Net assets acquired 329
Purchase consideration settled in cash 2,880
Cash outflow on acquisition 2,880
The goodwill attributable to the acquisition relates to the acquired customer
base and non-contractual relationships, the synergies between the business
acquired and the existing operations of the Group and the potential to develop
the acquired technologies, which do not meet the criteria for capitalisation
as intangible assets. The goodwill recognised is attributable to the
Microfiltration division and is expected to be deductible for income tax
purposes. The purchase is accounted for as an acquisition.
12. Deferred and contingent consideration on acquisitions
Fiber Ceramics TEM Filter Company
£'000 £'000 £'000
At 1 December 2015 56 - 56
Purchase consideration in the year - 3,377 3,377
Cash paid in the year (50) (2,880) (2,930)
Recognised in the income statement (7) 87 80
Exchange movements 1 112 113
At 30 November 2016 - 696 696
13. Cash generated from operations
2016£'000 2015£'000
Operating profit 10,669 9,801
Post-employment benefits 23 75
Share based payments 476 502
Depreciation, amortisation and impairment 2,553 2,156
Profit on disposal of property, plant and equipment (12) (17)
Operating cash flows before movement in working capital 13,709 12,517
Increase in inventories (1,114) (904)
(Increase)/decrease in trade and other receivables (798) 2,492
Increase/(decrease) in payables 230 (1,389)
Increase in provisions 1,337 578
(Increase)/decrease in working capital (345) 777
Cash generated from operations 13,364 13,294
14. Revenue at constant currency estimation
2016 2015 Growth
Metals Filtration £m £m %
Revenue at constant currency 30,080 29,701 1
Exchange 4,665 1,283
Revenue as reported 34,745 30,984 12
Microfiltration
Revenue at constant currency 70,765 63,950 11
Exchange 3,853 894
Revenue as reported 74,618 64,844 15
Group
Revenue at constant currency 100,845 93,651 8
Exchange 8,518 2,177
Revenue as reported 109,363 95,828 14
Revenue at constant currency is derived from translating overseas subsidiaries
at budgeted fixed exchange rates. In 2016 and 2015 the rates used were $1.6:£
and E1.4:£.
15. Basis of preparation
The results for the year ended 30 November 2016 have been prepared in
accordance with International Financial Reporting Standards (IFRSs) as adopted
by the European Union as at 30 November 2016. The financial information
contained in this announcement does not constitute statutory accounts as
defined in Section 434 of the Companies Act 2006. The financial information
has been extracted from the financial statements for the year ended 30
November 2016, which have been approved by the Board of Directors and on which
the auditors have reported without qualification. The financial statements
will be delivered to the Registrar of Companies after the Annual General
Meeting. The financial statements for the year ended 30 November 2015, upon
which the auditors reported without qualification, have been delivered to the
Registrar of Companies.
16. Annual general meeting
The Company's Annual General Meeting will be held at 10.30 a.m. on Tuesday 11
April 2017 at
Porvair Filtration Group
Limited, 1 Concorde Close, Segensworth, Fareham, Hampshire PO15 5RT.
17. Related parties
There were no related party transactions in the year ended 30 November 2016.
18. Responsibility Statement
Each of the Directors confirms that, to the best of their knowledge that:
· the financial statements, on which this announcement is based, have
been prepared in accordance with the applicable law and International
Financial Reporting Standards as adopted by the EU and give a true and fair
view of the assets, liabilities, financial position, and profit or loss of the
Company and the undertakings included in the consolidation taken as a whole;
and
· the review of the business includes a fair review of the development
and performance of the business and the position of the Company and the
undertakings included in the consolidation taken as a whole, together with a
description of the principal risks and uncertainties that they face.
The Directors of Porvair are listed in the Porvair Annual Report for the year
ended 30 November 2015. A list of current Directors is also maintained on the
Porvair website www.porvair.com.
Copies of full accounts will be sent to shareholders in March 2017. Additional
copies will be available from www.porvair.com.
This information is provided by RNS
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