REG - TT Electronics PLC - Half Yearly Report <Origin Href="QuoteRef">TTG.L</Origin> - Part 2
20/08/2015 07:00
- Part 2: For the preceding part double click ID:nRST5554Wa
107.5 33.8 49.8 72.5 263.6
Segment operating profit before exceptional items (0.9) 6.4 3.4 1.5 10.4
Adjustments to underlying operating profit (note 4) (2.8)
Operating profit 7.6
Net finance costs (1.3)
Profit before taxation 6.3
Six months ended 30 June 2014 *
£million Transportation Sensing and Control Industrial Sensing and Control Advanced Components Integrated Manufacturing Services Total
Revenue from external customers 118.9 24.7 48.1 69.4 261.1
Segment operating profit before exceptional items 2.3 4.3 3.8 2.7 13.1
Adjustments to underlying operating profit (note 4) (12.9)
Operating profit 0.2
Net finance costs (0.6)
Loss before taxation (0.4)
*Re-presented to exclude acquisition related items from underlying operating
profit. See note 2b.
Year ended 31 December 2014
£million Transportation Sensing and Control Industrial Sensing and Control Advanced Components Integrated Manufacturing Services Total
Revenue from external customers 230.5 58.8 98.8 136.2 524.3
Segment operating profit before exceptional items 1.4 12.8 9.5 5.5 29.2
Adjustments to underlying operating profit (note 4) (33.5)
Operating profit (4.3)
Net finance costs (1.6)
Loss before taxation (5.9)
There is no significant revenue between segments.
3. Segmental reporting (continued)
b) Analysis of revenue by destination - continuing operations
£million Six months Six months Year ended
ended ended 31 December 2014
30 June 2015 30 June 2014
United Kingdom 42.4 43.4 86.4
Rest of Europe 119.1 133.4 256.0
North America 56.0 45.6 101.0
Central and South America 1.5 1.8 3.4
Asia 43.3 35.4 74.5
Rest of the World 1.3 1.5 3.0
Total continuing operations 263.6 261.1 524.3
4. Underlying measures
£million Six months Six months Year ended
ended ended 31 December 2014
30 June 2015 30 June 2014*
Restructuring
Operational Improvement Plan (1.6) (10.2) (15.0)
Other restructuring costs (0.6) (2.5) (4.8)
Charges associated with management changes - - (2.4)
(2.2) (12.7) (22.2)
Asset impairments
Impairment charges associated with capitalised development costs - - (8.4)
Other impairments - - (1.0)
- - (9.4)
Acquisition related costs
Contingent consideration (0.2) - (0.8)
Amortisation of intangible assets arising on business combinations (0.4) (0.2) (0.7)
M&A costs (included aborted deals) - - (0.4)
(0.6) (0.2) (1.9)
Total (2.8) (12.9) (33.5)
*Re-presented to exclude acquisition related items from underlying operating
profit. See note 2b.
Restructuring costs £2.2 million (June 2014: £12.7 million; December 2014:
£22.2 million)
In the six months ended 30 June 2015 total restructuring costs of £2.2 million
were incurred, of which £1.6 million related to the Operational Improvement
Plan and £0.6 million related to other restructuring costs.
In the prior period total restructuring costs of £12.7 million were incurred,
including £10.2 million relating to the Operational Improvement Plan and £2.5m
relating to other restructuring costs including UK site consolidation and
costs related to the IMS Romania facility.
4. Underlying measures (continued)
In the 12 months ended 31 December 2014 total restructuring costs of £22.2
million were incurred, including £15 million relating to Operational
Improvement Plan and £7.2 million relating to other restructuring costs
including UK site consolidation, costs related to the IMS Romania facility and
change of management structure.
Asset Impairments £nil (June 2014: £nil; December 2014 £9.4 million)
In the 12 months ended 31 December 2014 £9.4 million of costs were incurred
for the impairment of assets, relating mainly to capitalised development
expenditure. No such costs were incurred in the six months ended 30 June 2015
or six months ended 30 June 2014.
Acquisition costs £0.6 million (June 2014: £0.2 million; December 2014 £1.9
million)
In the six months ended 30 June 2015 acquisition costs amounted to £0.6
million which related principally to the amortisation of acquired intangible
assets.
In the prior period acquisition costs of £0.2 million related to the
amortisation of acquired intangible assets.
In the 12 months ended 31 December 2014 £1.9 million of acquisition related
costs were incurred, including deferred acquisition consideration of £0.8
million, £0.7 million relating to amortisation of acquired intangible assets
and M&A costs of £0.4 million.
5. Taxation
The half-year tax charge is based on a forecast effective tax rate of 26.9% on
profit excluding restructuring, asset impairments and acquisition related
costs.
The enacted UK tax rate applicable from 1 April 2015 is 20%. The UK Government
have announced, but not enacted, legislation to reduce the UK tax rate to 19%
from 1 April 2017 and 18% from 1 April 2020.
6. Earnings per share
Basic earnings/loss per share is calculated by dividing the profit/loss
attributable to the owners of the Company by the weighted average number of
shares in issue during the period. The weighted average number of shares in
issue is 159.0 million (30 June 2014: 158.2 million, 31 December 2014: 158.3
million).
Underlying earnings per share is based on profit for the period from
continuing operations before restructuring costs, asset impairments and
acquisition related costs and their associated tax effect.
Pence Six months Six months Year ended
ended ended 31 December 2014
30 June 2015 30 June 2014
Basic earnings/(loss) per share 2.6 (2.1) (6.6)
Diluted earnings/(loss) per share 2.6 (2.1) (6.6)
6. Earnings per share (continued)
The numbers used in calculating underlying earnings per share are shown
below:
£million Six months Six months Year ended
ended ended 31 December 2014
30 June 2015 30 June 2014*
Continuing operations
Profit/(loss) for the period attributable to owners of the Company 4.1 (3.3) (10.5)
Restructuring 2.2 12.7 22.2
Acquisition related costs 0.6 0.2 1.9
Asset impairments - - 9.4
Tax effect of above items (0.2) (0.1) (2.5)
Underlying earnings 6.7 9.5 20.5
Underlying earnings per share (pence) 4.2 6.0 12.9
*Re-presented to exclude acquisition related items from underlying operating
profit. See note 2b.
7. Dividends
Pence per share Six months ended Pence Year ended
30 June 2015 per share 31 December 2014
£million £million
Final dividend for prior year 3.8 6.0 3.8 6.0
Interim dividend for current year - - 1.7 2.7
3.8 6.0 5.5 8.7
The Directors have declared an interim dividend of 1.7 pence per share which
will be paid on 29 October 2015 to shareholders on the register on 16 October
2015. Shares will become ex-dividend on 15 October 2015. The Group has a
progressive dividend policy.
8. Retirement benefit schemes
The Group operates one significant defined benefit scheme in the UK and an
overseas defined benefit scheme in the USA. These schemes are closed to new
members and the UK scheme is closed to future accrual.
The amounts recognised in the Condensed consolidated balance sheet are:
£million Six months Six months Year ended
ended ended 31 December 2014
30 June 2015 30 June 2014
Fair value of assets 451.1 397.1 464.9
Present value of funded obligation (467.9) (412.9) (477.3)
Net liability recognised in the balance sheet (16.8) (15.8) (12.4)
The costs recognised in the Condensed consolidated income statement are:
£million Six months Six months Year ended
ended ended 31 December 2014
30 June 2015 30 June 2014
Scheme administration costs 0.3 0.3 0.7
Net interest on employee obligations 0.2 0.4 0.8
The triennial valuation of the UK scheme as at April 2013 showed a deficit of
£19.1 million compared with £39.4 million at April 2010. It was agreed with
the Trustee that the existing recovery plan is sufficient to address the
deficit; namely contributions of £4.3 million and £4.5 million to be paid in
respect of 2015 and 2016. £2.1 million was paid in the half-year. In addition,
the Group has set aside £3.0 million to be utilised in agreement with the
Trustee for reducing the long-term liabilities of the scheme.
9. Reconciliation of net cash flow to movement in net (debt)/funds
£million Net cash Borrowings Net
and finance (debt)/funds
leases
At 1 January 2014 54.5 (27.6) 26.9
Cash flow (25.9) (16.0) (41.9)
Non-cash items - (0.1) (0.1)
Exchange differences (0.7) 0.9 0.2
At 1 July 2014 27.9 (42.8) (14.9)
Cash flow 10.6 (8.9) 1.7
Non-cash items - (0.1) (0.1)
Exchange differences 0.9 (1.9) (1.0)
At 1 January 2015 39.4 (53.7) (14.3)
Cash flow (3.1) (7.9) (11.0)
Non-cash items - - -
Exchange differences (1.4) 1.3 (0.1)
Balance at 30 June 2015 34.9 (60.3) (25.4)
Net cash includes overdraft balances of £nil (30 June 2014: £nil, 31 December
2014: £nil).
10. Share capital
During the period the Company issued 59,391 ordinary shares as a result of
share options being exercised under the Sharesave scheme and Share Purchase
plans. The aggregate consideration received was £0.1 million, which was
represented by a £0.1 million increase in share premium.
11. Related party transactions
Transactions between the company and its subsidiaries have been eliminated on
consolidation and are not disclosed in this note.
No related party transactions have taken place during the six months ended 30
June 2015 that have affected the financial position or performance of the
Group.
12. Principal risks and uncertainties
As described on pages 20 to 21 of the 2014 Annual Report, the Group continues
to be exposed to a number of operational and financial risks and has an
established, structured approach to identifying, assessing and managing those
risks. The Directors do not believe that the risks faced by the Group have
changed significantly during the first six months of 2015, and these relate to
the following areas:
Product development; margin erosion; Operational Improvement Plan; health and
safety; people and capability; supplier resilience and continuity; product
quality, product liability and contractual risk; legal and regulatory
compliance.
This information is provided by RNS
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