REG - Robinson PLC - Half Yearly Report <Origin Href="QuoteRef">RBSN.L</Origin>

RobinsonAnnouncement

29/10/2014 14:00

RNS Number : 5569P
Robinson PLC
20 August 2014
Robinson plc
("Robinson" or the "Company)
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2014
HIGHLIGHTS
 Madrox acquisition completed on 25 June 2014
 Revenues flat after a positive first quarter
 Lower property rental income of 0.2m following sale of the Portland property in 2013
 Exceptional cost of 0.4m relating to acquisition of Madrox (2013: gain of 1.1m on sale of property)
 Underlying operating profit of the trading businesses flat and reported profit before tax 0.3m (2013: 2.2m)
 Interim dividend increased by 12% to 2.25p (2013: 2.0p)
CHAIRMAN'S STATEMENT
Revenues & Profits
In a period when we have seen both grocery and major brand sales come under pressure from discounters, I am pleased to report that, despite a weak second quarter, our turnover in the first six months of 2014 has remained at last year's level. Gross margins have slipped slightly mainly as a result of cost increases that could not be passed on to our customers. Operating costs have risen by 0.2m primarily as a consequence of non-repeating credits that benefited the prior year. Property rental income is 0.2m lower than the same period last year, following the sale of the Portland property to Sonoco. The underlying operating profit pre-exceptional, non-repeating items and the Portland factory rental income is broadly comparable with the previous year.
Madrox Acquisition
The acquisition of Madrox,completed on 25th June, has not affected the first half revenues although it has added to the costs. The addition is fully in line with our strategy to expand in Central Europe partly through selective acquisition of local plastic packaging manufacturers who supply the strong brand owners and leading private labels in our sectors. It will allow us to take a more prominent position in the growing plastic packaging markets in this region.
Madrox is based in Warsaw and is a supplier of blow, stretch-blow and injection moulded plastic packaging primarily to major brands and private label businesses operating in the household, toiletries and cosmetics sectors in Central Europe. The audited Madrox accounts for the year ended 31 December 2013 reported sales of 9.8m and a profit before tax of 2.2m. The unaudited accounts for the 6 months ended 30 June 2014 show sales of 5.0m and a profit before tax of 1.1m.
Cash & Finances
We have funded the initial 10.9m cash element for the acquisition of Madrox (with costs) from the 5.4m cash reserves held at the end of 2013, 3.5m of property backed Polish Zloty loans with the balance taken from our existing UK bank facilities. A final dividend of 2.5p was paid to shareholders on 1 June 2014 (2013: 2.25p). Total borrowings at the end of the period were 4.9m. 
Outlook and Dividend
We reported sales in the first quarter were 8% higher, so sales in the second quarter have reversed that to leave us level with the previous year at the half year stage. Trends as we begin the second half indicate some improvement and, if sustained, we expect to show growth in sales in the underlying business by the end of this year. The Madrox addition will make a significant step change in the scale of the Group. The Board has therefore approved an increased interim dividend of 2.25p (2013: 2.0p) to be paid on 1 October 2014 to shareholders on the register at 29 August 2014.
For more information please contact:
Robinson plc

Guy Robinson, Finance Director
Tel: 01246 389283

www.robinsonpackaging.com
WH Ireland

Katy Mitchell
Tel: 0161 832 2174


Robinson plc
Group Income Statement



Six months to 30.06.14

Six months to 30.06.13

Year to 31.12.13

Notes

'000 

'000 

'000 








Revenue


10,888 

10,886 

23,329 
Cost of sales


(8,812)

(8,671)

(18,148)
Gross profit


2,076 

2,215 

5,181 
Operating costs


(1,581)

(1,185)

(2,859)
Exceptional (costs)/gain


(364)

1,054 

1,054 
Operating profit


131 

2,084 

3,376 
Finance income - interest receivable


14 

2 

11 
Finance costs - bank interest payable


(1)

(1)

(1)
Finance income in respect of pension fund


165 

124 

307 
Profit before taxation


309 

2,209 

3,693 
Taxation
2 

(76)

(310)

(599)
Profit for the period


233 

1,899 

3,094 








Earnings per ordinary share (EPS)
4 

pence

pence

pence
EPS from continuing operations excluding exceptional items


3.6

5.2

12.6
EPS from continuing operations


1.4

11.7

19.2
























Diluted EPS
4 






EPS from continuing operations excluding exceptional items


3.5

5.0

12.2
EPS from continuing operations


1.4

11.3

18.5
































Statement of comprehensive income


'000 

'000 

'000 








Profit for the period


233 

1,899 

3,094 
Items that will not be reclassified subsequently to profit or loss:







Remeasurement of net defined benefit liability


- 

- 

(308)
Deferred tax relating to items not reclassified


(12)

- 

152 



(12)

- 

(156)
Items that may be reclassified subsequently to profit or loss:







Exchange differences on translation of foreign operations


(74)

(58)

3 
Other comprehensive expense for the period


(86)

(58)

(153)
Total comprehensive income for the period


147 

1,841 

2,941 


Robinson plc
Group Statement of Financial Position



30.06.14

30.06.13

31.12.13



'000 

'000 

'000 
Non-current assets







Property, plant and equipment


15,946 

8,913 

10,802 
Intangible assets


5,681 

- 

- 
Deferred tax assets


127 

111 

160 
Pension asset


4,053 

4,224 

4,053 



25,807 

13,248 

15,015 
Current assets







Inventories


2,716 

1,958 

2,150 
Trade and other receivables


7,732 

9,802 

6,565 
Cash


- 

1,055 

5,375 



10,448 

12,815 

14,090 
Non-current assets held for sale


1,250 

2,782 

1,250 
Total assets


37,505 

28,845 

30,355 








Current liabilities







Trade and other payables


(4,372)

(3,821)

(4,527)
Corporation tax payable


(181)

(211)

(130)
Loan Borrowings


(487)

-

-
Overdraft


(2,995)

- 

- 



(8,035)

(4,032)

(4,657)
Non-current liabilities







Loan Borrowings


(1,454)

- 

- 
Deferred tax liabilities


(442)

(545)

(407)
Deferred consideration


(2,520)

-

-
Provisions


(187)

(187)

(187)



(4,603)

(732)

(594)
Total liabilities


(12,638)

(4,764)

(5,251)








Net assets


24,867 

24,081 

25,104 
















Equity







Share capital


82 

80 

82 
Share premium 


610 

526 

610 
Capital redemption reserve


216 

216 

216 
Translation reserve


225 

240 

299 
Revaluation reserve


4,416 

4,371 

4,416 
Retained earnings


19,318 

18,648 

19,481 
Equity attributable to shareholders


24,867 

24,081 

25,104 


Robinson plc
Group Statement of Cash Flows


Six months to 30.06.14

Six months to 30.06.13

Year to 31.12.13


'000 

'000 

'000 
Cash flows from operating activities






Profit for the period

233 

1,899 

3,094 
Adjustments for:






Depreciation of property, plant and equipment

470 

476 

969 
Profit on disposal of other plant and equipment

(8)

(5)

(20)
Profit on sale of non-current asset

- 

- 

(1,054)
Other finance income in respect of pension fund

(165)

(128)

(307)
Finance costs

1 

1 

1 
Finance income

(14)

- 

(11)
Taxation charged

76 

310 

599 
Non-cash items:






 Pension current service cost

96 

128 

170 
 Cost of share options

25 

24 

43 
Operating cash flows before movements in working capital

714 

2,705 

3,484 
Decrease/(increase) in inventories

90

(350)

(542)
Decrease/(increase) in trade and other receivables

950

(882)

(641)
Decrease in trade and other payables

(1,062)

(587)

(25)
Cash generated by operations

692

886 

2,276 
Tax paid

(228) 

(367)

(769)
Interest received/ (paid)

13 

(2)

(3)
Net cash generated from operating activities

477

517 

1,504 
Cash flows from investing activities






Interest received

14 

- 

11 
Proceeds of disposal of non-current assets

- 

- 

4,250 
Acquisition of subsidiary

(10,346)

-

-
Acquisition of plant and equipment

(70)

(565)

(1,402)
Disposal of other plant and equipment

9 

28 

45 
Net cash (used in)/generated from investing activities

(10,393)

(537)

2,904 
Cash flows from financing activities






Loans paid

- 

(307)

(307)
Proceeds on issue of shares

- 

- 

193 
New Bank Loans raised

1,941

-

-
Dividends paid

(395)

(361)

(662)
Net cash generated from/(used in) financing activities

1,546

(668)

(776)
Net (decrease)/increase in cash and cash equivalents

(8,370)

(688)

3,632 
Cash and cash equivalents at 1 January

5,375 

1,743 

1,743 
Cash and cash equivalents at end of period

(2,995) 

1,055 

5,375 







Cash

- 

1,055 

5,375 
Overdraft

(2,995)

- 

- 
Cash and cash equivalents at end of period

(2,995)

1,055 

5,375 


Robinson plc 
Notes to the Interim Report
1. Basis of preparation
The interim report for the six month period to 30 June 2014 was approved by the directors on 19 August 2014. The interim financial information is not audited. 
The interim financial statements have been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRSs). These should be read in conjunction with the Group's annual financial statements for the year ended 31 December 2013, which have been prepared in accordance with applicable IFRSs. The information for the year ended 31 December 2013 does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The auditors reported on those accounts: their report was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under sections 498 (2) or (3) respectively of the Companies Act 2006. 
2. Taxation
The taxation charge for the six months to 30 June 2014 has been calculated on the basis of the estimated effective tax rate on profits before tax for the year to 31 December 2014.
3. Dividends

Six months to 30.06.14

Six months to 30.06.13

Year to 31.12.13
Ordinary:
'000 

'000 

'000 
 Final
395 

361 

349 
 Interim
- 

- 

313 

395 

361 

662 
4. Earnings per share
The calculation of basic and diluted earnings per ordinary share for continuing operations shown on the income statement is based on the profit after taxation of 233,000 divided by the weighted average number of shares in issue, net of treasury shares of 16,394,304: for diluted earnings per share 17,048,518.The calculation of basic and diluted earnings per ordinary share for continuing operations excluding exceptional items is based on a profit of 597,000 being the profit after taxation of 233,000 plus the exceptional item of 364,000.
5. Madrox Acquisition
On 25 June 2014 the Group acquired effective control of 100% of the share capital of MADROX Spka Jawna, a Polish based manufacturer of plastic packaging. This transaction has been accounted for using the acquisition method of accounting. The book and fair value of the net assets of the acquired business were as follows:
Net assets at date of acquisition

Book Value
Fair Value adjustments
Total Fair Value


'000
'000
'000





Intangible assets

-
5,681
5,681
Property, plant & equipment

2,881
2,669
5,550
Inventories

656

656
Trade & other receivables

2,117

2,117
Trade & other payables

-1,139

-1,139
Cash & bank balances

121

121


4,636
8,350
12,986





The adjustment to intangible assets represents customer contacts acquired and will be amortised over the life of the relationships. The adjustment to property, plant and equipment represents the difference between book value and estimated market value of the assets. The consideration paid in cash on 25 June 2014 was 10.5m and a further 2.5m accrued as the estimated value of the earnout payment due in 2016. The level of the earnout is dependent upon performance of the Madrox business prior to the payment of the earnout. In addition, acquisition costs of 0.4m have been expensed and reported as exceptional costs.
6. Going concern
The directors have considered the cash flow forecasts for the Group and the availability of facilities. As at the date of this report, the directors have a reasonable expectation that the Group has adequate resources to continue in business for the foreseeable future. Thus they continue to adopt the going concern basis of accounting.
7. Interim report
Copies of the interim report are available from Robinson plc's registered office: Field House, Wheatbridge, Chesterfield, S40 2AB, UK or from its website at www.robinsonpackaging.com.
ends
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