REG - Zotefoams PLC - Half-year Report <Origin Href="QuoteRef">ZTF.L</Origin> - Part 2

ZotefoamsAnnouncement

08/08/2017 07:07

- Part 2: For the preceding part double click  ID:nRSH3392Na 

                                                                            
 Group revenue from external customers  5,684                  10,828              7,850          2,707              27,069  
 Non-current assets                     28,281                 -                   21,155         598                50,034  
 
 
8.    INCOME TAX EXPENSE 
 
                                       Six months     Six months     
                                       ended          ended          
                                       30 June 2017   30 June 2016   
                                       
                                       (unaudited)    (unaudited)    
                                       £'000          £'000          
 Current Tax:                                                        
 UK Corporation Tax                    611            433            
 Overseas taxation                     27             3              
 Adjustment in respect of prior years  -              -              
 Current taxation                      638            436            
 Deferred Tax                          (108)          86             
 Total tax charge                      530            522            
 
 
Income tax expense is recognised based on management's estimate of the
weighted average annual income tax rate expected for the full financial year.
The estimated average annual tax rate used for the six months ended 30 June
2017 was 19% (2016:19%). 
 
Tax is accrued based on an estimated tax rate applicable to estimated annual
earnings. 
 
9.    DIVIDENDS 
 
                                                                                      Six months     Six months     
                                                                                      ended          ended          
                                                                                      30 June 2017   30 June 2016   
                                                                                      
                                                                                      (unaudited)    (unaudited)    
                                                                                      £'000          £'000          
 Final dividend for the year ended 31 December 2016 of 3.90p (2015: 3.80p) per share  1,710          1,664          
 
 
The final dividend for the year ended 31 December 2016 was paid on 25 May
2017. The interim dividend of 1.91p (2016: 1.85p) per share, amounting to
£0.8m (2016: £0.8m) has not been recognised as a liability in this interim
financial information. It will be recognised in shareholders' equity in the
year to 31 December 2017. 
 
10.   EARNINGS PER SHARE 
 
Earnings per ordinary share is calculated by dividing consolidated profit
after tax attributable to equity holders of the Parent Company of £2.28m
(2016: £2.27m) by the weighted average number of shares in issue during the
period, excluding own shares held by employee trusts which are administered by
independent trustees. The number of shares held in the trust at 30 June 2017
was 549,467 (2016: 628,979). Distribution of shares from the trust is at the
discretion of the trustees. Diluted earnings per ordinary share adjusts for
the potential dilutive effect of share option schemes in accordance with IAS
33 Earnings per share. 
 
                                                      Six months     Six months     
                                                      ended          ended          
                                                      30 June 2017   30 June 2016   
                                                      
                                                      (unaudited)    (unaudited)    
                                                      £'000          £'000          
 Weighted average number of ordinary shares in issue  43,819,872     43,715,063     
 Deemed issued for no consideration                   777,305        603,994        
 Diluted number of ordinary shares issued             44,597,177     44,319,057     
 
 
11.   FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT 
 
The Group's activities expose it to a variety of financial risks including
credit risk, interest rate risk, liquidity risk and foreign currency risk. 
 
The condensed consolidated interim financial statements do not include all
financial risk management information and disclosures required in the annual
financial statements; they should be read in conjunction with the Group's
annual financial statements as at 31 December 2016. There have been no changes
in any risk management policies since the year end. 
 
Fair value estimation 
 
The table below analyses financial instruments carried at fair value, by
valuation method. The different levels have been defined as follows: 
 
·      Quoted prices (unadjusted) in active markets for identical assets or
liabilities (Level 1). 
 
·      Inputs other than quoted prices included within Level 1 that are
observable for the asset or liability, either directly (that is, as prices) or
indirectly (that is, derived from prices) (Level 2). 
 
·      Inputs for the asset or liability that are not based on observable
market data (that is, unobservable inputs) (Level 3). 
 
The following table presents the Group's financial instruments that are
measured at fair value at 30 June 2017. 
 
                             Level 1      Level 2      Level 3      Total        
                             £'000        £'000        £'000        £'000        
                             (unaudited)  (unaudited)  (unaudited)  (unaudited)  
 Assets                                                                          
 Forward exchange contracts  -            223          -            -            
 Total assets                -            223          -            -            
 Liabilities                                                                     
 Forward exchange contracts  -            (80)         -            -            
 Total liabilities           -            (80)         -            -            
 
 
The following table presents the Group's financial instruments that are
measured at fair value at 30 June 2016. 
 
                             Level 1      Level 2      Level 3      Total        
                             £'000        £'000        £'000        £'000        
                             (unaudited)  (unaudited)  (unaudited)  (unaudited)  
 Liabilities                                                                     
 Forward exchange contracts  -            (1,110)      -            (1,110)      
 Total liabilities           -            (1,110)      -            (1,110)      
 
 
The forward exchange contracts have been fair valued using forward exchange
rates that are quoted in an active market. 
 
Group's valuation process 
 
The Group's finance department performs the valuation of forward exchange
contracts required for financial reporting purposes. This is reported to the
Audit Committee. 
 
The results of the valuation processes are included in the Group's monthly
reporting to the Directors, which includes all members of the Audit
Committee. 
 
Fair value of financial assets and liabilities measured at amortised cost 
 
The fair value of borrowings (excluding bank overdraft) is as follows: 
 
              30 June 2017  30 June 2016  
              (unaudited)   (unaudited)   
              £'000         £'000         
 Current      10,251        1,146         
 Non-current  4,869         5,765         
 Total        15,120        6,911         
 
 
The fair value of the following financial assets and liabilities approximate
to their carrying amount: 
 
·      Trade and other receivables 
 
·      Other current financial assets 
 
·      Cash and cash equivalents (including bank overdraft) 
 
·      Trade and other payables 
 
·      Other current liabilities 
 
12.   RELATED PARTY TRANSACTIONS 
 
There were no material related party transactions requiring disclosure for the
periods ended 30 June 2017 and 30 June 2016. 
 
13.   BORROWINGS 
 
On 16 March 2017, the Group and Company increased its multi-currency revolving
credit facility ('RCF') by a further £2m, bringing the total to £10m, secured
on the property and book debts of the Company. This facility has financial
covenants on net debt/EBITDA and EBIT/gross financing costs ratios. During
2016 an RCF of £8m was taken out and the bank overdraft facility reduced to
£2.0m. 
 
14.   CAPITAL COMMITMENTS 
 
Capital expenditure commitments of £3.2m (2016: £9.5m) have been contracted
for at the end of the reporting period but not yet incurred, and are in
respect of Property, Plant and Equipment. 
 
15.   EXCEPTIONAL ITEMS 
 
Items that are material either because of their size or their nature, or that
are non-recurring, are considered as exceptional items and are presented
within the line items to which they best relate. During the current period,
following legal advice received by the pension trustees and an estimate
calculated by the actuaries, the Company has provided £1m for potential
additional liabilities in its Defined Benefit Pension Scheme. This cost has
been included in the condensed consolidated interim Income Statement as an
operating exceptional cost. 
 
During the prior period, the exceptional item related to redundancy costs
totalling £0.3m as a result of the efficiency improvement programme, which
have been included in the condensed consolidated interim Income Statement as
an operating exceptional cost. 
 
16.   EVENTS OCCURING AFTER THE REPORTING PERIOD 
 
An interim dividend of 1.91p per share (2016: 1.85p per share) was proposed by
the Board of Directors on 7 August 2017. It is payable on 12 October 2017 to
shareholders who are on the register at 15 September 2017. This interim
dividend has not been recognised as a liability in this interim financial
information. It will be recognised in shareholders' equity in the year to 31
December 2017.On 4 August 2017, the Group and Company raised a £7.5m debt
facility, secured on the plant and equipment, and fixtures and fittings of the
Company. 
 
This information is provided by RNS
The company news service from the London Stock Exchange