REG - Trifast PLC - Half Yearly Report - six months ended 30.9.15 <Origin Href="QuoteRef">TRFT.L</Origin> - Part 2
10/11/2015 07:01
- Part 2: For the preceding part double click ID:nRSJ1087Fa
Depreciation and amortisation 106 395 10 409 32 952
Assets and liabilities
Segment assets 39,944 33,877 2,309 45,970 24,631 146,731
Segment liabilities (21,902) (9,952) (332) (9,606) (33,421) (75,213)
September 2014 UK£000 Europe£000 USA£000 Asia£000 Central costs,assets andliabilities£000 Total£000
Revenue*
Revenue from external customers 31,989 21,171 1,903 18,970 - 74,033
Inter segment revenue 929 184 25 2,868 - 4,006
Total revenue 32,918 21,355 1,928 21,838 - 78,039
Underlying operating result 2,920 2,877 193 2,661 (1,577) 7,074
Net financing costs (147) (46) (1) (38) (215) (447)
Underlying segment result 2,773 2,831 192 2,623 (1,792) 6,627
Separately disclosed items(see note 2) (1,688)
Profit before tax 4,939
Specific disclosure items
Depreciation and amortisation 79 74 7 426 234 820
Assets and liabilities
Segment assets 38,016 29,768 1,728 47,148 20,548 137,208
Segment liabilities (22,616) (9,159) (300) (11,081) (27,403) (70,559)
* Revenue is derived from the manufacture and logistical supply of industrial
fasteners and category 'C' components.
4. Taxation
Six monthsended30 September2015£000 Six monthsended30 September2014£000 Year ended31 March2015£000
Current tax on income for the period
UK tax 616 (69) 580
Foreign tax 1,636 1,562 3,223
Deferred tax expense (285) (50) (473)
Adjustments in respect of prior years 17 10 125
1,984 1,453 3,455
5. Dividend
The dividend payable of £1.7m represents the final dividend recommended for
the year ended 31 March 2015, approved by shareholders at the AGM on 16
September 2015 and paid to shareholders on the Register on 13 October 2015.
6. Earnings per share
The calculation of earnings per 5 pence ordinary share is based on profit for
the period after taxation and the weighted average number of shares in the
period of 116,198,101 (HY2015: 113,495,406; FY2015: 113,540,187).
The calculation of the fully diluted earnings per 5 pence ordinary share is
based on profit for the period after taxation. In accordance with IAS 33 the
weighted average number of shares in the period has been adjusted to take
account of the effects of all dilutive potential ordinary shares. The number
of shares used in the calculation amount to 119,967,521 (HY2015: 117,436,525;
FY2015: 118,768,522).
The underlying diluted earnings per share, which in the Directors' opinion
best reflects the underlying performance of the Group, is detailed below:
Six monthsended30 September2015£000 Six monthsended30 September2014£000 Year ended31 March2015£000
Profit after tax for the period 5,125 3,486 8,394
Net acquisition costs 252 1,200 750
Intangible amortisation 302 238 551
Costs on exercise of executive share options - 228 511
Release of closure provision for TR Formac (Suzhou) Co. Ltd - - (94)
IFRS 2 share based payment charge 608 22 741
Tax adjustment (232) (354) (541)
Underlying profit after tax 6,055 4,820 10,312
Basic EPS 4.41p 3.10p 7.39p
Diluted EPS 4.27p 2.97p 7.07p
Underlying diluted EPS 5.05p 4.10p 8.68p
7. Analysis of net debt
At30 September2015£000 At30 September2014£000 At31 March2015£000
Cash and cash equivalents 20,889 13,596 15,453
Bank overdraft (1) (47) (439)
Net cash and cash equivalents 20,888 13,549 15,014
Debt due within one year (20,268) (11,691) (11,906)
Debt due after one year (16,882) (19,389) (16,523)
Gross debt (37,150) (31,080) (28,429)
Net debt (16,262) (17,531) (13,415)
8. Reconciliation of net cash flow to movement in net debt
Six monthsended30 September2015£000 Six monthsended30 September2014£000 Year ended31 March2015£000
Net increase/(decrease) in cash and cash equivalents 6,536 (1,861) (521)
Net increase in borrowings (8,354) (18,420) (17,021)
(1,818) (20,281) (17,542)
Exchange rate differences (1,029) 720 2,097
Movement in net debt (2,847) (19,561) (15,445)
Opening net (debt)/cash (13,415) 2,030 2,030
Closing net debt (16,262) (17,531) (13,415)
9. Subsequent event - Acquisition of Kuhlmann Befestigungselemente GmbH & Co.
KG ('Kuhlmann')
On 1 October 2015, Trifast acquired Kuhlmann for a total consideration of
E8.5m (£6.2m). The initial amount of E6.8m (£4.9m) was paid on completion in
cash and E0.04m (£0.03m) was satisfied by the allotment of 29,350 ordinary
shares in the Company. Consideration of E1.7m (£1.2m) will be deferred for 12
months and is to serve as a retention against which any potential warranty and
indemnity claims will be offset. The cash consideration will be met from the
Company's existing bank facilities.
Trifast will be investing into Kuhlmann to further develop the opportunities
in the German market and expect the acquisition of Kuhlmann to be earnings
enhancing in the first full year of ownership.
Based in Verl, close to Bielefeld, Germany, Kuhlmann was founded in 1996 and
employs 18 staff. It is a well-respected highly efficient distributor of
industrial fastenings within the domestic German market. Its emphasis is on
delivering high quality products and services to its well-established
longstanding customer base in the principal sectors of machinery and plant
engineering, sheet metal processing and industrial. Kuhlmann's management team
and previous owners, Frank Niggebrügge, Eric Hütter and Peter Henning, will
continue to run the business with the support of the operational management
team and staff who will remain within the business.
For the year ended 31 December 2014, Kuhlmann reported revenue of E6.7m
(£5.4m) and profit before tax of E1.7m (£1.4m). Gross assets at the same date
were E1.4m (£1.1m).
As the acquisition completed so close to the 30 September 2015, the values
disclosed below are all considered provisional and are given for information
purposes only. Prior to consolidation in to the Group numbers, all amounts
will be subject to a full fair value assessment as part of the completion
accounts process. Updated consolidated values will be disclosed in the Report
and Accounts for the year 31 March 2016.
Effect of Acquisition Provisionalvalues onacquisition£000
Property, plant and equipment 176
Intangible assets 3,651
Inventory 463
Trade and other receivables 420
Cash and cash equivalents 583
Trade and other payables (297)
Deferred tax liabilities (1,011)
Net identifiable assets and liabilities 3,985
Consideration paid:
Initial cash price paid 4,897
Deferred consideration at fair value 1,232
Equity instruments issued 31
Total consideration 6,160
Goodwill on acquisition 2,175
Intangible assets that arose on the acquisition include the following:
· £3.3m of customer relationships, with an amortisation period deemed to
be ten years
· £0.4m of other intangibles, with an amortisation period deemed to be
under one year
Goodwill is the excess of the purchase price over the fair value of the net
assets acquired and is not deductible for tax purposes. It mostly represents
potential synergies, e.g. cross-selling opportunities between Kuhlmann and
Trifast Group and Kuhlmann's assembled workforce.
Effect of Acquisition
The Group estimates that it will incur costs of £0.3m in relation to the
acquisition of Kuhlmann. These estimated costs have been included as
separately disclosed items in administrative expenses in the Group's
consolidated statement of comprehensive income.
INDEPENDENT REVIEW REPORT BY KPMG LLP TO TRIFAST PLC
Introduction
We have been engaged by the company to review the condensed set of financial
statements in the half-yearly financial report for the six months ended 30
September 2015 which comprises the consolidated income statement, the
consolidated statement of comprehensive Income, the consolidated statement of
changes in equity, the consolidated statement of financial position, the
consolidated statement of cash flows and the related explanatory notes. We
have read the other information contained in the half-yearly financial report
and considered whether it contains any apparent misstatements or material
inconsistencies with the information in the condensed set of financial
statements.
This report is made solely to the company in accordance with the terms of our
engagement to assist the company in meeting the requirements of the Disclosure
and Transparency Rules ("the DTR") of the UK's Financial Conduct Authority
("the UK FCA"). Our review has been undertaken so that we might state to the
company those matters we are required to state to it in this report and for no
other purpose. To the fullest extent permitted by law, we do not accept or
assume responsibility to anyone other than the company for our review work,
for this report, or for the conclusions we have reached.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been
approved by, the directors. The directors are responsible for preparing the
half-yearly financial report in accordance with the DTR of the UK FCA.
As disclosed in note 1, the annual financial statements of the Group are
prepared in accordance with IFRSs as adopted by the EU. The condensed set of
financial statements included in this half-yearly financial report has been
prepared in accordance with IAS 34 Interim Financial Reporting as adopted by
the EU.
Our responsibility
Our responsibility is to express to the company a conclusion on the condensed
set of financial statements in the half-yearly financial report based on our
review.
Scope of review
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 UK. 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.
Conclusion
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 30 September 2015 is not prepared,
in all material respects, in accordance with IAS 34 as adopted by the EU and
the DTR of the UK FCA.
Derek McAllan
for and on behalf of KPMG LLP
Chartered Accountants
1 Forest Gate
Brighton Road
Crawley
West Sussex
RH11 9PT
9 November 2015
Electronic Communications
The Company is not proposing to bulk print and distribute hard copies of this half-yearly financial report for the six months ended 30 September 2015 unless specifically requested by individual shareholders. News updates, Regulatory News, and Financial statements, can be viewed and downloaded from the Group's website, www.trifast.com. Copies can also be requested via corporate.enquiries@trifast.com r, in writing to, The Company Secretary, Trifast plc, Trifast House, Bellbrook Park, Uckfield, East Sussex,
TN22 1QW.
This information is provided by RNS
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