TIDMTCN
RNS Number : 7090Q
Tricorn Group PLC
23 June 2020
23 June 2020
Tricorn Group plc
Interim Results
For the six months ended 31 March 2020
Tricorn Group plc ('Tricorn' or the 'Group') , (AIM: TCN.L) the
tube manipulation specialist, announces its unaudited interim
results for the six months ended 31 March 2020. These results are
further to Tricorn's announcement on 2 April 2020 of a change in
its year end from 31 March to 30 September.
Summary
-- Results significantly impacted by COVID-19 pandemic
-- Successfully completed a Placing and Open Offer of new
ordinary shares at 10p per share on 5 February 2020 raising net
proceeds of GBP1.335m
-- Cash headroom GBP1.8m at 1 June 2020
-- All Group facilities operational from 20 April 2020 onwards
Financial Summary
Unaudited Unaudited Audited
six months six months 12 months
31 March 31 March 31 March
2020 2019 2019
Restated*** Restated***
GBP'000 GBP'000 GBP'000
Revenue 8,453 11,348 22,763
EBITDA* 118 1,120 2,250
(Loss)/Profit before tax* (572) 511 1,041
Cashflow generated by operations (802) 1,060 1,566
Cash & cash equivalents 766 493 493
Net Borrowing ** (3,628) (3,112) (3,112)
(Loss)/Earnings per share - basic* (1.51)p 1.44p 2.89p
Dividend - 0.2p 0.2p
*All references to EBITDA, operating profit, profit before tax
and EPS are before intangible asset amortisation, share based
payment charges and Rabun Gap start up costs
** Net Borrowing excludes the impact of finance lease
liabilities and operating lease liabilities as defined by IFRS
16
*** Comparative periods' profit, EPS and cashflow generated by
operations have been restated for the impact of IFRS 16 Leases
Commenting on the results and the Group's prospects, Andrew
Moss, Chairman of Tricorn, said:
"This has been an extremely challenging period, during which our
operations worldwide have been significantly impacted by COVID-19.
During March, our facilities in the USA and UK were temporarily
closed due to issues with customer demand, supply chains and
concerns for employee safety.
Throughout, the Board has remained focused on the safety of our
employees, supporting our customers, with whom we continue to work
closely, and mitigating the impact of the lower revenues on the
Group's profitability and cash flow.
I am pleased to report that all of our facilities were
operational from 20 April 2020 onwards. Our Chinese joint venture
continues to operate normally, and, trading at our UK Malvern
facility has returned to pre-COVID-19 levels. However, whilst
demand has started to increase at the UK West Bromwich and USA
facilities, it is still at significantly lower levels than compared
to earlier in the year.
At this time, as for many businesses, the outlook remains
uncertain. We are, however, pleased that as a result of a focused
plan of action, as at 1 June 2020, the Company had, as reported,
cash headroom of GBP1.8m. This positions us well to weather these
exceptional times and to capitalise on growth opportunities as we
move forward.
Enquiries:
Tricorn Group plc Tel +44 (0)1684 569956
Mike Welburn, Chief Executive www.tricorn.uk.com
Phil Lee, Group Finance Director corporate@tricorn.uk.com
Shore Capital Tel + 44 (0)20 7408
4080
Tom Griffiths/David Coaten (Corporate
Advisory)
Henry Willcocks (Corporate Broking)
Notes to Editors:
Tricorn is a value added manufacturer and specialist manipulator
of pipe and tubing assemblies to niche markets worldwide.
Headquartered in Malvern, UK, Tricorn employs around 300
employees and has five manufacturing facilities in the UK, USA and
China.
Chairman's and Chief Executive's statement
Performance in the six months ended 31 March 2020
The results of the Group for the six months ended 31 March 2020
(the "period") were significantly impacted by the COVID-19
pandemic. Whilst the Group had been able to re-open its Chinese
joint venture in mid-February, following a brief period of closure,
significant disruption, as detailed in the Group's announcement on
20 March 2020, has been experienced elsewhere in the Group's
facilities.
Both Tricorn's UK facilities were temporarily closed on 25 March
2020 amidst safety concerns for employees and following serious
disruption to supply chains and numerous customer closures. The
Group's USA facilities closed a few days later with similar
concerns and challenges. Most of the Group's UK and US employees
were furloughed from the end of March, with the remaining key staff
focused on ensuring that the Group's facilities were in full
compliance with the latest Government guidelines to allow an early
and safe restart once supply chains and customer demand were
re-established.
The Group's UK and US facilities reopened from 20 April 2020
onwards, albeit with reduced staffing levels and employees
continuing to work from home wherever possible.
Revenue and profit before tax* were significantly impacted.
Revenue at GBP8.453m for the period was 25.6% lower than the six
months ended 31 March 2019 (the "corresponding period") (2019:
GBP11.348m). Loss before tax was GBP0.572m (2019: profit
GBP0.511m).
The UK Job Retention Scheme and the USA furlough scheme have,
and continue to be, utilised by the Group and GBP0.55m has also
been obtained through the USA Payroll Protection Program. The Group
has also secured an additional GBP1.0m of funding through the UK
Government's Coronavirus Business Interruption Loan Scheme
("CBILS") facility from its existing bank, HSBC. This loan has a
6-year term with the first year being free of interest and capital
repayments and an annual interest rate thereafter of 3.99% over the
Bank of England's base rate. Combined with the other measures
taken, this provided the Group, as of 1 June 2020, with cash
headroom of GBP1.8m.
Operational Review
The Group has five manufacturing facilities across the UK, USA
and China. These locations make it ideally positioned to support
its blue-chip OEM customer base, many of whom are seeking to
localise supply and technical support for their facilities in these
key regions. At the start of the year, the Group consolidated its
brands with Franklin Tubular Products and the more recently
announced expansion at Rabun Gap operating as Tricorn USA and
Malvern Tubular Components and Maxpower Automotive as Tricorn UK.
The joint venture in China remains as Minguang-Tricorn Tubular
Products. Reporting is now on a geographic segment basis.
UK
The Group has two manufacturing facilities in the UK located in
West Bromwich and Malvern. The Malvern facility specialises in the
design and manufacture of larger tubular assemblies and
fabrications for engine, cooling and generator set applications.
Its customer base serves the power generation, oil and gas, mining
and marine applications markets. The West Bromwich site is focused
on rigid, nylon and hybrid tubular products for engines, hydraulic
actuation, transmission lubrication and fuel sender sub-systems.
Key end markets are on and off road applications including
construction, trucks and agriculture.
Demand had slowed in the UK compared to the previous six months
with a further softening through February 2020 as some customers
experienced supply shortages from China. However, the situation
deteriorated rapidly through March. As set out above, both Tricorn
UK facilities were temporarily closed on 25 March 2020 amidst
safety concerns for employees and following serious disruption to
supply chains and numerous customer closures.
Revenue at GBP5.125m was 27.3% down on the corresponding period
(2019: GBP7.047m). Segmental loss was GBP0.208m (2019: profit
GBP0.596m).
USA
In the USA, in May 2019, the Group had extended its capabilities
with the purchase of a custom built, powder coat and wet spray
painting line located in leased premises at Rabun Gap, Georgia, a
short distance from its manufacturing facilities at Franklin, North
Carolina. This facility has allowed previously sub-contracted
processes to be brought in-house as well as providing for further
expansion of manufacturing facilities when market conditions
improve.
Market demand slowed in the period when compared to the previous
six months with this reduction escalating through March 2020 due to
the impact of COVID-19. Revenue at GBP3.328m was down 22.6% on the
corresponding period (2019: GBP4.301m). Segmental loss in the
period was GBP0.360m (2019: loss GBP0.146m).
Joint Venture
Our Chinese joint venture, Minguang-Tricorn Tubular Products,
performed well. The facility was re-opened in mid-February 2020
following a brief period of closure and has remained operational
since that time. The Group's share of profit for the six months
ended 31 March 2020 was GBP0.087m (2019: GBP0.132m).
Financial Review
As stated above, the results for the six months ended 31 March
2020 were significantly affected by the impact of COVID-19. In
China, following the Chinese Spring Festival, the majority of
businesses, including our joint venture were not allowed to reopen.
Our management worked closely with the local government and agreed
a range of measures that allowed our facility to be reopened within
2 weeks. Through February and into March, the UK and US divisions
of the Group were experiencing a level of volatility in customer
schedules brought about by the impact on customers' schedules and
supply chains as COVID-19 started to spread beyond China.
Subsequently, towards the end of March, the Group closed its UK
facilities, with the US following suit soon afterwards.
All of the Group's manufacturing facilities were reopened and
operational from 20 April 2020 onwards, albeit at reduced
volumes.
As a result of the impact of, and uncertainty around COVID-19,
and, in particular, the impact on the movement of people and social
distancing, the Group announced on 2 April 2020, after consultation
with its auditors, that the required timescales in which to
complete its year end audit were unachievable and, as a result,
that it would change its accounting reference date from 31 March to
30 September. These results are therefore unaudited interim results
for the six months to 31 March 2020 and audited accounts for the 18
month period to 30 September 2020 will be released during December
2020.
As reported in its interim results statement for the six months
to 30 September 2019, the Group has adopted IFRS 16 Leases under
the modified approach. Using this approach, the Group is not
required to restate the detailed financial statements for prior
periods. However, where it is appropriate for comparative purposes,
key performance indicators used in the highlights and commentaries
have been restated.
Interim results are shown for the six months to 31 March 2020
with comparatives to the same period in the prior year.
As a result of the impact of COVID-19 towards the end of the
current period, the Group's EBITDA for the current period was
GBP0.118m (2019 Restated: GBP1.120m) and underlying loss before tax
was GBP0.572m (2019 Restated: profit GBP0.511m).
Income Statement
Revenue for the current period, at GBP8.453m, decreased by 25.6%
over the corresponding period (2019: GBP11.348m). While the Group
had previously indicated lower revenues were expected for the six
months to 31 March 2020, predominantly through weaker US markets,
COVID-19 impacted heavily the 1 January 2020 to 31 March 2020
quarter. All of the Group's divisions were affected. In line with
Group policy when reporting the results for its joint venture in
China, the Group has reported its share of the profit before tax
whilst the revenue figure for the joint venture is not reported in
the Group's consolidated income statement.
Gross margins were broadly in line with the corresponding period
at 37.9% (2019: 38.3%) and the Group managed to reduce its
distribution costs to GBP0.357m (2019: GBP0.512m). However, the
Group's administration costs at GBP3.324m (2019: GBP3.327m) were
largely unchanged as a result of the volatility and speed with
which business was impacted by COVID-19 related circumstances
towards the end of the period.
The Group's Chinese joint venture, Minguang-Tricorn Tubular
Products, managed to put in place cost saving measures during the
planned Chinese Spring Festival shutdown, to minimise the financial
impact of COVID-19 through February. As a result, the Group's share
of profit for the period was GBP0.087m (2019: GBP0.132m).
As previously indicated, the Group has now adopted IFRS 16
Leases. The impact on the Group has been largely immaterial in the
current period, with a reduction to underlying PBT in the period of
GBP0.024m. After finance charges, the Group underlying loss before
tax was GBP(0.572)m (2019 Restated: profit GBP0.511m).
After deducting intangible asset amortisation and share based
payment charges, the loss before tax for the current period was
GBP0.774m (2019 Restated: profit GBP0.450m).
Basic loss per share for the current period was 2.20p (2019
Restated: EPS 1.33p) and after adjusting for non-underlying items,
the underlying loss per share was 1.65p (2019 Restated: EPS 1.44p).
For the 12 month cumulative period to 31 March 2020, the underlying
loss per share was 0.88p (2019 Restated: EPS 2.89p).
The Board is not recommending the payment of a dividend.
Cash Flow
As indicated in the Group's announcement of its interim results
for the six months to 30 September 2019, cash generated by Group
operations was impacted by softer market conditions coupled with
the introduction of additional tariffs on imported goods causing US
suppliers to shorten credit terms, which put pressure on the
Group's cash generation. This credit tightening within the supply
chain also became apparent in the UK in the current period. In
addition, the inload of new business deferred from the six months
ended 30 September 2019 was impacted towards the end of the period
by COVID-19.
On 5 February 2020, and prior to the full impact of COVID-19
being realised, the Group successfully completed a Placing and Open
Offer of new ordinary shares at 10p per share. A total of
14,924,285 new ordinary shares were issued, with net proceeds,
after legal, professional and listing costs, of GBP1.335m being
received by the Company.
The Group's cash outflow from operations in the current period
was GBP0.802m (2019 Restated: GBP1.060m). The major contributors to
the outflow were the tightening of credit terms within the supply
chain, the delay in receipts from customers at the end of March as
a result of COVID-19 related factory shutdowns, which were
subsequently received in late April, and higher inventory at the
end of the period, again as a result of customers closing due to
COVID-19 and not accepting planned deliveries.
The Group's investment in capital expenditure reduced
significantly in the current period to GBP0.161m, (2019:
GBP0.396m). There was no expenditure on new product introduction
related intangible assets in the current period (2019:
GBP0.202m).
Net borrowing, which excludes finance leases and operating
leases as defined by IFRS 16 Leases, was GBP3.628m (2019:
GBP3.112m), with the Group being impacted at the period end by
adverse exchange rate movements and major customers delaying
payments as indicated above. Gearing was up slightly on the
corresponding period to 45.4% (2019: 42.6%).
COVID-19
As a result of the impact of COVID-19, the Group has put a
number of measures in place and utilised UK and US Government
support in order to retain its employees and protect the Group.
These include:-
-- Accessing the UK and US Government furlough schemes
-- Utilising the UK Government's Time To Pay scheme, deferring PAYE payment liabilities
-- Deferring UK VAT payments, in line with UK Government guidance
-- Successfully applying for funding through the UK Government's
CBILS programme, raising GBP1.0m of additional funds (further
details of which are set out above)
-- Successfully applying for funding through the US Government's
Payroll Protection Programme, raising GBP0.55m of additional
funds
With the additional funding secured, the Group is in a much
stronger position, with cash headroom of GBP1.8m as of 1 June 2020
, as the economy begins to recover.
Balance Sheet
Total assets at 31 March 2020 were GBP18.587m after recognising
an asset of GBP3.062m relating to operating leases in line with
IFRS 16. To partially offset this, both current and non-current
liabilities now recognise total obligations under leases of
GBP3.109m, which represents the present value of the Group's future
finance and operating lease commitments. Net assets are impacted
only to the extent of the impact on profitability of GBP0.047m for
the 12 months to 31 March 2020.
Net working capital at 31 March 2020 was GBP5.164m, which was
GBP1.124m higher than at 31 March 2019 of GBP4.040m. This increase
is a result of the delay in customer receipts at the end of March,
resulting from COVID-19 related factory shutdowns and the
tightening of terms within the supply chain, which has subsequently
unwound, as highlighted previously.
People
The Board would like to take the opportunity to thank all our
employees for their hard work and support throughout the current
period and especially in the last few months. Their commitment and
dedication has ensured that we continue to support our customers
through these challenging times. The Board would also like to thank
Phillip Lee for his significant contribution to Tricorn during his
time as Group Finance Director and wish him well in his new
venture.
Outlook
This has been an extremely challenging period, during which our
operations worldwide have been significantly impacted by COVID-19.
During March, our facilities in the USA and UK were temporarily
closed due to issues with customer demand, supply chains and
concerns for employee safety.
Throughout, the Board has remained focused on the safety of our
employees, supporting our customers, with whom we continue to work
closely, and mitigating the impact of the lower revenues on the
Group's profitability and cash flow.
I am pleased to report that all of our facilities were
operational from 20 April 2020 onwards. Our Chinese joint venture
continues to operate normally, and, trading at our UK Malvern
facility has returned to pre-COVID-19 levels. However, whilst
demand has started to increase at the UK West Bromwich and USA
facilities, it is still at significantly lower levels than compared
to earlier in the year.
At this time, as for many businesses, the outlook remains
uncertain. We are, however, pleased that as a result of a focused
plan of action, as at 1 June 2020, the Company had, as reported,
cash headroom of GBP1.8m. This positions us well to weather these
exceptional times and to capitalise on growth opportunities as we
move forward.
Andrew Moss Mike Welburn
Chairman Chief Executive
Group income statement
For the six months ended 31 March 2020
Note Unaudited Audited
Unaudited Unaudited six Unaudited year
six months six months months to six months ended 31
to 31 to 31 March 31 March to 31 March March
March 2020 2020 2020 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Underlying Non-Underlying Group
Revenue 3 8,453 - 8,453 11,348 22,763
Cost of sales (5,252) - (5,252) (7,009) (14,025)
------------ -------------- ----------- ----------- -----------
Gross profit 3,201 - 3,201 4,339 8,738
Distribution costs (357) - (357) (512) (1,022)
Administration costs
* General administration costs (3,324) - (3,324) (3,327) (6,701)
* Rabun Gap start up costs - (115) (115)
* Intangible asset amortisation - (74) (74) (43) (102)
* Share based payment charge - (13) (13) (18) (36)
Total administration costs (3,324) (202) (3,526) (3,388) (6,839)
Operating (Loss)/profit (480) (202) (682) 439 877
------------ -------------- ----------- ----------- -----------
Share of profit from joint venture 87 - 87 132 282
Finance costs (179) - (179) (97) (209)
(Loss)/Profit before tax 3 (572) (202) (774) 474 950
Income tax expense (14) - (14) (25) (66)
(Loss)/Profit for the year and total
comprehensive (expense)/income (586) (202) (788) 449 884
============ ============== =========== =========== ===========
Attributable to:
Equity holders of the parent company (586) (202) (788) 449 884
============ ============== =========== =========== ===========
Continuing Operations
(Loss)/Earnings per share:
Basic (Loss)/earnings per share 4 (2.03)p 1.33p 2.62p
Diluted (Loss)/earnings per share 4 (2.03)p 1.23p 2.39p
Group statement of changes in equity
For the period ended 31 March 2020
Share
based
Share Share Merger Translation payment Retained
capital premium reserve Reserve Reserve earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 30 September
2018 3,379 1,692 1,388 (23) 367 4 6,807
(unaudited)
Share based payment
charge - - - - 18 - 18
----------------------------------------- ------------------------------------------- ------------------------------------------- ----------------------------------------------- ------------------------------------------ ------------------------------------------- -------------------------------------
Total transactions with
owners - - - - 18 - 18
Foreign exchange loss
on translation of
Reserves - - - 37 - - 37
Total comprehensive
expense - - - - - 449 449
----------------------------------------- ------------------------------------------- ------------------------------------------- ----------------------------------------------- ------------------------------------------ ------------------------------------------- -------------------------------------
Balance at 31 March
2019 3,379 1,692 1,388 14 385 453 7,311
(audited)
Issue of new shares 50 - - - - - 50
Share based payment
charge - - - - 14 - 14
----------------------------------------- ------------------------------------------- ------------------------------------------- ----------------------------------------------- ------------------------------------------ ------------------------------------------- -------------------------------------
Total transactions with
owners 50 - - - 14 - 64
Foreign exchange gain
on translation of
Reserves - - - (46) - - (46)
Total comprehensive
expense - - - - - 170 170
----------------------------------------- ------------------------------------------- ------------------------------------------- ------------------------------------------------ ------------------------------------------ ------------------------------------------- -------------------------------------
Balance at 30 September
2019 3,429 1,692 1,388 (32) 399 623 7,499
(unaudited)
Issue of new shares 1,493 - - - - - 1,493
Cost of new share issue - - - - - (158) (158)
Share based payment
charge - - - - 13 - 13
Dividends paid - - - - - (69) (69)
----------------------------------------- ------------------------------------------- ------------------------------------------- ----------------------------------------------- ------------------------------------------ ------------------------------------------- -------------------------------------
Total transactions with
owners 1,493 - - - 13 (227) 1,279
Foreign exchange loss
on translation of
Reserves - - - 1 - - 1
Total comprehensive
income - - - - - (788) (788)
----------------------------------------- ------------------------------------------- ------------------------------------------- --------------------------------------------- ------------------------------------------ ------------------------------------------- -------------------------------------
Balance at 31 March
2020 4,922 1,692 1,388 (31) 412 (392) 7,991
(unaudited)
========================= ========================= =========================== ========================= ============================ ========================= =====================
Group statement of financial position
At 31 March 2020
Unaudited Audited
31 March 31 March
2020 2019
GBP'000 GBP'000
Assets
Non current
Goodwill 391 391
Intangible assets 271 401
Property, plant and equipment 7,927 4,668
Investment in joint venture 1,219 1,191
---------- ---------
9,808 6,651
Current
Inventories 3,120 3,040
Trade and other receivables 4,893 4,854
Cash and cash equivalents 766 493
Corporation tax - 6
---------- ---------
8,779 8,393
Total assets 18,587 15,044
========== =========
Liabilities
Current
Trade and other payables (2,849) (3,854)
Borrowings (4,394) (3,675)
Obligations under leases (585) -
Corporation tax (61) (70)
(7,889) (7,599)
Non-current
Obligations under leases (2,682) (109)
Deferred tax (25) (25)
---------- ---------
(2,707) (134)
Total liabilities (10,596) (7,733)
Net assets 7,991 7,311
========== =========
Equity attributable to owners of the parent
Share capital 4,922 3,379
Share premium account 1,692 1,692
Merger reserve 1,388 1,388
Translation reserve (31) 14
Share based payment reserve 412 385
Profit and loss account (392) 453
Total equity 7,991 7,311
========== =========
Group statement of cash flows
For the period ended 31 March 2020
Unaudited Unaudited Audited
six months six months year ended
to to
31 March 31 March 31 March
2020 2019 2019
GBP'000 GBP'000 GBP'000
Cash flows from operating activities
Profit after taxation (788) 449 884
Adjustment for:
Depreciation 511 297 575
Net finance costs in statement of comprehensive
income 179 97 209
Amortisation charge 74 43 102
Share based payment charge 13 18 36
Share of joint venture operating profit (87) (132) (282)
Taxation expense recognised in statement
of comprehensive income 14 25 66
Decrease in trade and other receivables 72 306 229
Decrease in trade payables and other
payables (1,003) (195) (542)
Decrease/(Increase) in inventories 213 (39) (88)
----------- ----------- ----------
Cash generated by operations (802) 869 1,189
Interest paid (179) (109) (246)
Net cash generated by operating activities (981) 760 943
=========== =========== ==========
Cash flows from investing activities
Purchase of plant and equipment (161) (396) (723)
Purchase of intangible assets - (202) (278)
Net cash used by investing activities (161) (598) (1,001)
=========== =========== ==========
Cash flows from financing activities
Issue of new shares 1,493 - -
Costs of Issue of ordinary share capital (158) - -
Dividends received from investments 172 - -
Dividends paid (68) - -
Proceeds of overseas short term borrowing - 304 304
Movement in short term borrowings 365 (574) (361)
Payment of finance lease liabilities (322) (42) (84)
----------- ----------- ----------
Net cash generated by/(absorbed by) financing
activities 1,482 (312) (141)
Net decrease in cash and cash equivalents 340 (150) (199)
Cash and cash equivalents at beginning
of period 426 643 692
----------- ----------- ----------
Cash and cash equivalents at end of period 766 493 493
=========== =========== ==========
1 General information
Tricorn Group plc and subsidiaries' (the 'Group') principal
activities comprise high precision tube manipulation, systems
engineering and specialist fittings.
The Group's customer base includes major blue chip companies
with world-wide activities in key market sectors, including Power
Generation, Oil & Gas, Off Highway, Commercial Vehicles,
Agriculture and Automotive.
Tricorn Group plc is the Group's ultimate parent company. It is
incorporated and domiciled in the United Kingdom. The address of
Tricorn Group plc's registered office, which is also its principal
place of business, is Spring Lane, Malvern, Worcestershire, WR14
1DA. The Group's shares are admitted to trading on the Alternative
Investment Market of the London Stock Exchange.
These unaudited interim consolidated financial statements have
been approved for issue on 23 June 2020 by the Board of Directors.
Amendments to the financial statements are not permitted after they
have been approved. Copies of this announcement are available on
the Company's website, www.tricorn.uk.com.
The financial information set out in this interim report does
not constitute statutory accounts as defined in the Companies Act
2006. The Group's statutory financial statements for the year ended
31 March 2019 have been filed with the Registrar of Companies. The
auditor's report on those financial statements was unqualified and
did not contain a statement under Section 498(2) or (3) of the
Companies Act 2006.
2 Accounting policies
Basis of preparation
These unaudited interim consolidated financial statements are
for the six months ended 31 March 2020. They have been prepared in
accordance with IAS 34 "Interim Financial Reporting" as adopted by
the European Union. They do not include all of the information
required for full annual financial statements and should be read in
conjunction with the consolidated financial statements of the Group
for the year ended 31 March 2019, which have been prepared in
accordance with International Financial Reporting Standards.
The same accounting policies and methods of computation are
followed in the interim financial statements as compared with the
most recent annual financial statements.
IFRS16 Leases - Overview
IFRS 16 replace IAS 17 and provides a single lease accounting
model, requiring lessees to recognise right of use assets and lease
liabilities in the balance sheet for all relevant leases.
The Group has now adopted IFRS 16 Leases under the modified
retrospective approach. The adoption of IFRS 16 under the modified
retrospective approach affects only the current reporting period
and does not require restatement of comparative half and full year
financial statements. In addition, the Board has decided to measure
right-of-use assets by reference to the measurement of the lease
liability on 1 April 2019 and therefore there is no immediate
change to net assets at this date. After 1 April 2019 instead of
recognising operating lease costs within operating profit in the
Statement of Comprehensive Income the Group will recognise
depreciation of the right of use asset within operating profit and
interest costs of the lease liability within finance costs. This
will result in a decrease in profit before tax reported of
approximately GBP0.047m. Where appropriate and to provide
comparison in the narrative, comparatives have been restated for
key financial indicators.
3 Segmental reporting
As announced at the time of the final results for the year ended
31 March 2019, the Group has carried out a review of its
organisation structure and concluded that segmental results will
now be reported on a geographic basis as follows:
-- UK - Comprising all UK based trading divisions
-- US - Comprising all North America based trading divisions
-- The joint venture in China will continue to be reported
separately
The financial information detailed below is frequently reviewed
by the Chief Operating Decision maker.
6 months to 31 March 2020 (unaudited)
UK US Unallocated Joint Venture Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue
- From external customers 5,125 3,328 - - 8,453
- From other segments - - - - -
5,125 3,328 - - 8,453
Segmental (loss)/profit before tax (208) (360) (91) 87 (572)
Rabun Gap start up costs (115)
Intangible asset amortisation (74)
Share based payment charge (13)
________
Profit before tax (774)
Segmental total assets 10,371 6,738 1,478 - 18,587
6 months to 31 March 2019 (unaudited)
UK US Unallocated Joint Venture Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue
- From external customers 7,047 4,301 - - 11,348
- From other segments 59 - (59) - -
7,106 4,301 (59) - 11,348
Segmental profit/(loss) before tax 596 (146) (47) 132 535
Intangible asset amortisation (43)
Share based payment charge (18)
_________
Profit before tax 474
Segmental total assets 6,993 6,171 1,880 - 15,044
3 Segmental reporting (continued)
Year ended 31 March 2019
UK US Unallocated Joint Venture Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue
- From external customers 14,022 8,741 - - 22,763
- From other segments 59 - (59) - -
14,081 8,741 (59) - 22,763
Segmental profit/(loss) before tax 980 46 (220) 282 1,088
Intangibles amortisation (102)
Share based payment charge (36)
_________
Profit before tax 950
Segmental total assets 6,993 6,171 1,880 - 15,044
4 Earnings per share
The calculation of the basic earnings per share is based on the
earnings attributable to ordinary shareholders divided by the
weighted average number of shares in issue during the year.
The calculation of diluted earnings per share is based on the
basic earnings per share, adjusted to allow for the issue of shares
and the post tax effect of dividends and/or interest, on the
assumed conversion of all dilutive options and other dilutive
potential ordinary shares.
Reconciliations of the earnings and weighted average number of
shares used in the calculations are set out below:
Six months ended 31 March 2020
Weighted average
Profit number of shares Earnings per
share
GBP'000 Number '000 Pence
Basic loss per share (788) 38,862 (2.03)
-------- ----------------- --------------
Dilutive shares -
Diluted loss per share (788) 38,862 (2.03)
-------- ----------------- --------------
Six months ended 31 March 2019
Weighted average
Profit number of shares Earnings per
share
GBP'000 Number '000 Pence
Basic earnings per share 449 33,795 1.33p
-------- ----------------- --------------
Dilutive shares 2,745
Diluted earnings per share 449 36,540 1.23p
-------- ----------------- --------------
4 Earnings per share (continued)
31 March 2019
Weighted average
Profit number of shares Earnings per
share
GBP'000 Number '000 Pence
Basic earnings per share 884 33,795 2.62p
-------- ----------------- --------------
Dilutive shares 3,248
Diluted earnings per share 884 37,043 2.39p
-------- ----------------- --------------
The directors consider that the following adjusted earnings per
share calculation is a more appropriate reflection of the Group's
performance.
Six months ended 31 March 2020
Weighted
average
number of
Loss shares Loss per
share
GBP'000 Number '000 Pence
Basic loss per share (788) 38,862 (2.03)
----------------- ------------ -------------------
Amortisation of intangible asset 74
Rabun Gap start up costs 115
Share based payment charge 13
Adjusted loss per share (586) 38,862 (1.51)
----------------- ------------ -------------------
Dilutive shares -
Diluted loss earnings per share (586) 38,862 (1.51)
----------------- ------------ -------------------
Six months ended 31 March 2019
Weighted average
Profit number of shares Earnings per
share
GBP'000 Number '000 Pence
Basic earnings per share 449 33,795 1.33p
----------------------- ------------------------------- -------------------
Intangible asset amortisation 43
Share based payment charge 18
Adjusted earnings per share 510 33,795 1.50p
----------------------- ------------------------------- -------------------
Dilutive shares 2,745
Diluted adjusted earnings
per share 510 36,540 1.40p
----------------------- ------------------------------- -------------------
31 March 2019
Weighted average
Profit number of shares Earnings per
share
GBP'000 Number '000 Pence
Basic earnings per share 884 33,795 2.62p
----------------------- ------------------------------- -------------------
Intangible asset amortisation 102
Share based payment charge 36
Adjusted earnings per share 1,022 33,795 3.02p
----------------------- ------------------------------- -------------------
Dilutive shares 3,248
Diluted adjusted earnings
per share 1,022 37,043 2.76p
----------------------- ------------------------------- -------------------
There is no dilution to the basic or adjusted loss per share in
the current year owing to a loss being reported in the year.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR PPUWGQUPUGQP
(END) Dow Jones Newswires
June 23, 2020 02:00 ET (06:00 GMT)
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