TIDMWTM
RNS Number : 6444N
Waterman Group PLC
23 February 2009
WATERMAN DELIVERS CONSISTENT PERFORMANCE
IN CHALLENGING TRADING CONDITIONS
Waterman Group plc, the international engineering and environmental consultancy,
today announces its interim results for the six months to 31 December 2008.
* 12% increase in revenue to GBP71.1m (2007: GBP63.6m)
* EBITDA of GBP5.0m (2007: GBP5.1m)
* Adjusted* operating profit of GBP3.8m (2007: GBP4.1m)
* Adjusted* profit before tax of GBP3.3m (2007: GBP3.5m)
* Adjusted* basic earnings per share of 6.9p (2007: 8.2p)
* Net asset value per share of 133p (2007: 117p)
* Interim dividend per share of 1.3p (2007: 2.5p)
Statutory disclosures:
* Operating profit of GBP3.6m (2007: GBP4.0m)
* Profit before tax of GBP3.1m (2007: GBP3.3m)
* Basic earnings per share of 6.3p (2007: 7.8p)
*Adjusted business performance excludes the amortisation of acquired intangible
assets.
The reported profits include a foreign exchange gain of GBP1.45m and a charge of
GBP0.92m for restructuring and redundancy costs, of which 45% will be paid in
the second half of the financial year.
Commenting on the results, Nick Taylor, Chief Executive said:
" Trading conditions in the first half of the financial year proved challenging.
Group revenue has, however, increased by 12% and our overseas operations
increased revenue by 45%, accounting for 33% of total Group turnover."
" As is well documented, certain sectors and economies in various countries are
showing significant signs of slowing which is providing uncertainty to our
future workload and in particular Dubai is of concern to our business. As a
measure of prudent management, reductions to temporary and permanent staff have
been made in the first half of the financial year and these actions will result
in annual cost savings of GBP9.0m."
" We continue with our plans for geographical diversification and good progress
has been made on the 582,000 sq m mixed use Abu Dhabi Plaza development in
Astana, Kazakhstan which is being developed by Aldar Properties PJSC. In Russia,
we have been appointed as lead engineering consultant by IKEA to work on their
expansion programme and in Brussels we have commenced detailed design on the
30,000 sq m Flemish Parliament offices."
" The Group is not immune from the turmoil in the financial markets and great
challenges remain. Waterman's financial gearing remains low. The Group's strong
balance sheet provides stability and a sound basis to invest in new markets and
geographic locations to broaden further the client base of the company when
opportunities present themselves."
-ends-
Date: 23rd February 2009
For further information contact:
Waterman Group plc City Profile
Nick Taylor, Chief Executive Jonathan Gillen
Graham Hiscocks, Finance Director William Attwell
020-7928-7888 020-7448-3244
web: www.watermangroup.com
INTERIM MANAGEMENT REPORT
I am pleased to report that in the six months to December 2008, Waterman Group
achieved an increased revenue to GBP71.1m (2007: GBP63.6m). Adjusted pre tax
profit stands at GBP3.32m (2007: GBP3.51m) with pre tax profit of GBP3.08m
(2007: GBP3.33m). The statutory and adjusted pre tax profits include a foreign
exchange gain of GBP1.45m and a charge of GBP0.92m for restructuring and
redundancy costs of which 45% will be paid in the second half of the financial
year. Adjusted basic earnings per share are 6.9p (2007: 8.2p) and basic earnings
per share are 6.3p (2007: 7.8p).
Group Activities - UK
In the UK during the first six months of the financial year, Waterman achieved a
turnover consistent with the same period last year. Overall profit margins have
reduced, however, following a transfer from private sector to public sector
workload in the building and property related markets.
Waterman's Structures and Building Services companies provide planning and
design services to the property and development market. Fees generated in this
sector represent 35% of UK turnover. In addition, the London based team have
been providing technical support to our international operations on several
overseas projects in China, Kazakhstan, Russia and Bahrain.
During the first half, several of the UK's largest urban regeneration projects
designed by Waterman were completed on site. These include Liverpool One in
Liverpool, Cabot Circus in Bristol, Westfield London in White City and Highcross
in Leicester. Similar sized projects are currently being designed by Waterman in
Leeds and Peterborough. In London, Waterman has recently been appointed on two
projects with the Crown Estate and these are in addition to two previous
projects with the same client for developments in Regent Street. In December the
contractor was appointed for a high quality residential development next to the
Tate Modern Gallery for Native Land and Grosvenor. Work has commenced on site
and Waterman has been appointed for the detailed design of the buildings.
The Scottish office is currently providing design services on the Turnberry
Hotel refurbishment, including a Combined Heat and Power (CHP) on-site energy
centre and the first phase is programmed to be complete for hosting the British
Open Golf championship in July 2009. At Cambuslang Investment Park, which is to
be developed as part of a Scottish Enterprise Business Park, Waterman is
carrying out investigations as part of an independent validation exercise for
mineral stabilisation works previously completed on the site.
The Government's Building Schools for the Future programme and the education
sector in general is generating an increase in workload. Waterman is providing
consultancy services on 35 schools, colleges and universities and is also
bidding for GBP400m of future education related projects. Health projects are
also an expanding sector for Waterman and we are involved in the design of 16
primary care centres, hospitals and research facilities. Waterman has been
supplying Building Services consultancy services since 2005 on the Allenby
Connaught Ministry of Defence project for Aspire Defence Ltd which is the
largest PFI project commissioned to date and involves the redevelopment of
Salisbury and Aldershot Garrisons.
The Group's civil engineering companies now generate 48% of UK turnover. Current
projects include highways and infrastructure work on the strategic rail freight
interchange at the former Parkside colliery in St. Helens and a site close to
East Midlands Airport. Long term framework contracts continue to provide a
significant workload with ongoing agreements with Network Rail, London
Underground Infracos, British Airways, Highways Agency and many Local
Authorities. New commissions have been secured for the M60 Managed Motorway
feasibility study and the National Station Improvement Programme in East Anglia
for Network Rail.
The civil engineering outsourcing company which seconds engineers into the
public sector within the UK has achieved a 21% growth in seconded staff to 410
employees. Staff are seconded into many large public organisations such as the
Highways Agency, the Environment Agency, Transport Scotland, over 20 City
Councils and motorway management companies such as Optima and A One Plus.
Waterman's specialist highways transportation planning group has been continuing
its involvement on regional strategies for the identification of housing
allocation sites, mainly based around residential or mixed use regeneration
schemes. These include the Welsh Development Agency's "Northern Gateway", which
is a 203 hectare scheme and for Royal London Asset Management a GBP100m mixed
use scheme in the London Borough of Brent. Additional recent project
appointments include the strategic regeneration masterplan for Redcar and
Cleveland.
Waterman's Energy, Environment and Design company is involved in many long
running major projects including a power station decontamination at Lots Road
Chelsea, one of the UK's largest regeneration schemes at Wirral Waters
Birkenhead for Peel Holdings and Victoria Interchange for Land Securities.
Recent appointments include environmental advisory services on the incinerator
upgrade for London Waste at Edmonton, an Eco Park for Oaktech at Eccles,
Cambuslang Investment Park in Scotland and Gatwick airport vendor due diligence
for BAA.
Corporate Management services focusing on Environmental and Occupational Health
and Safety Systems support are being provided to a growing range of major
clients including Shell, Chevron, GKN, GE, Petroplus, Virgin Media, Goodyear
Dunlop, Britvic, G4S and Kraft. The scope of such services is growing following
the launch of "Greenspace" in October 2008 which is accessed via Waterman's new
corporate sustainability platform (www.legalregister.co.uk).
Our landscape, ecology and archaeology teams have continued to provide expert
advice for the planning and public consultations process at several projects
such as the Long Marston/Middle Quinton Ecotown, Dreamland Margate and the North
Devon wind farm development adjacent to Exmoor National Park.
I am pleased to be able to report that in November, Waterman won the
"Environmental Impact Award" category and the presentation was made by HRH the
Duke of Gloucester who is President of British Expertise at The British
Expertise International Awards 2008. In addition, Cabot Circus, the urban
regeneration development in Bristol designed by Waterman, won the British
Council of Shopping Centres "Supreme Gold Award."
Group Activities - Overseas
Waterman's revenue from overseas operations has continued to grow and now
generates 33% of the Group's total turnover. The established Waterman offices in
Russia, Poland, Belgium, Romania, China and Australia have continued to gain
significant new commissions, however the global economy has affected certain
countries more severely than others and this has impacted on our forward order
book. We experienced a noticeable slowdown towards the end of 2008 with
deferrals of certain projects in the UAE and in particular, Dubai.
In Poland, we have been appointed by Ghelamco, a Belgium client, for the design
of a 100,000m2 commercial and mixed use development in Warsaw which will involve
the construction of the tallest building in the city. We have also recently been
appointed for the detailed design phase of a 126,000m2 retail and mixed use
development at Bialystok for KeyInvest/IDG. Designs have continued during the
period on a 102,000m2 retail and residential development at Walbryzych.
Waterman's Belgium and Romania offices have been particularly busy during 2008
and have won several new commissions for projects not only in their own
countries but also in Hungary. Current major projects being designed in the
regions include the MG Tower in Ghent, Belgium which is a 25 storey tower
providing 30,000m2 of commercial space. This building is designed by the Belgian
architect Jaspers and Eyers who we are also working with on several other
projects in Poland. We have been appointed by Codic to design a 56,000m2 office
development in Hungary which follows on from the recently completed Zenith Tower
for the same client. Detailed design has commenced on the 30,000m2 Flemish
Parliament building.
Scheme design has progressed well on the 582,000m2 mixed use Abu Dhabi Plaza
development in Astana, Kazakhstan which is being developed by Aldar Properties
PJSC. In November 2008 we were appointed as lead engineering consultant by IKEA
to work on their Russian expansion programme. Design work has progressed on
Moscow Ocean Park which is a 200,000m2 leisure project in the city centre.
We have designed a 20 storey 5 star hotel for Hilton which is being constructed
in Kampala, Uganda and work has progressed up to the 10th floor. We are also
providing site supervision for this project during the construction phase. In
Dublin, we have been appointed as lead consultant on the implementation study
for the Docklands Rapid Transit bus system.
Our Middle East and Asia region includes our offices in UAE, India, China and
Australia and projects and resources are shared between the various offices. In
Abu Dhabi we were appointed in November 2008 to provide a Facilities Management
Strategy for a portfolio of over 2,000 government owned buildings. We have also
expanded our environmental group in the UAE and they are providing LEED
(Leadership in Energy and Environmental Design) consultancy services to many
clients and projects. Waterman has recently been appointed for the design of the
building services fit out for the 7,000m2 Nokia Siemens Network new regional
headquarters at Dubai Knowledge Village.
The contractor for the 450,000m2 Al Muneera mixed use development at Al Raha
Beach, Abu Dhabi has now been appointed and construction work has commenced on
this project. Waterman is the lead consultant on this project and we have a
large team based on site. Al Bustan Hotel in Oman was completed in 2008 for IHG
Group and is now operating again as one of the pre-eminent hotels in the Middle
East. The structural work on the Crowne Plaza and Staybridge hotels at Yas
Island, an Aldar development in Abu Dhabi, has now been completed and the
building services design and installation is being progressed in preparation for
the completion of the hotels for the first Formula 1 race in the region in
November 2009.
In China, the construction of the Tianjin Binhai open bridge over the River
Haihe is progressing well and we have recently completed the simulation study
for the operation of the bridge. Waterman was appointed in January 2009 for the
concept masterplan design of Tianjin Binhai Ecology Wetlands Park which covers
an area of 20km2.
Our Melbourne office in Australia has been extremely busy on several Healthcare
projects and is currently overseeing the construction phase of the AU$ 1.0bn
Royal Children's Hospital for the State Government of Victoria. In Sydney,
Waterman is providing ESD (Ecologically Sustainable Development) consultancy
services on the AU$ 200m 100 Mount Street commercial project, which is being
developed by the joint venture between Delmege Constructions and Laing O'Rourke
Australia. Current projects on site in Sydney include the Western Plains Zoo
development and Dee Why Hotel.
In 2008, Waterman Australia won an award for Export Services from the Australian
Institute of Export in recognition of providing a competitive range of
consulting services on projects in Dubai, Abu Dhabi, Romania, Kazakhstan and
Poland. The Waterman Group philosophy is to develop professional teams which are
able to provide consulting engineering services on an international basis and
this award is a testament to the success of our global diversification and
response to the needs of our clients.
Acquisitions
There have been several acquisition opportunities considered by the Group during
the last six months, however in view of the volatility of the global economy the
Board has deemed it inappropriate to proceed with any of these opportunities at
this time. An important part of our long term growth strategy will involve the
acquisition of complementary, earnings enhancing businesses in the UK and
overseas as and when the time arises.
Dividend
In light of the prevailing economic climate, the Board has decided to reduce the
level of the dividend payment. This will now be established at a sustainable
level with the annual dividend per share to be covered at least 4 times by
earnings per share (before amortisation and non-recurring items). The Board has
therefore decided to declare an interim dividend of 1.3p per share (2007: 2.5p)
payable on 21 April 2009 to shareholders on the register on 20 March 2009.
Outlook
Over the last six months the average monthly turnover has been broadly in line
with the average monthly turnover from the last quarter of the previous
financial year. However, certain sectors and economies in various countries are
showing signs of slowing which is providing uncertainty to our future workload.
In particular, projects are being deferred in the UAE, however, new
opportunities are being discussed with clients operating in Libya, Qatar and
Syria.
In response to changing circumstances, reductions to temporary and permanent
staff have been made in the first half of the financial year and these actions
will result in annual cost savings of GBP9.0m. Furthermore, the Board is closely
monitoring the economy and the Group's forward workload and when necessary, will
take further action to align costs with expected revenue.
Our financial gearing remains low and the Group's strong balance sheet provides
stability and a sound basis to invest in organic growth and earnings enhancing
acquisition opportunities in the future. Cash collection will remain a focus of
the business with an emphasis on reducing the debtors days and maximising
working capital efficiency.
The Group is not immune from the turmoil in the financial markets and challenges
remain. The future of public sector work in the UK and economies in developing
countries is unpredictable, however, the Board is exploring new opportunities in
diverse markets and geographic locations to broaden further the client base of
the company.
Roger Fidgen
Chairman
23rd February 2009
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | |
| Consolidated Income Statement | | | |
| for the six months ended | | | |
| 31 December 2008 | | | |
+---------------------------------------------+--------------------+--------------------+--------------------+
| | | Unaudited | Unaudited | Audited |
| | | Six months to 31 | Six months to 31 | Twelve months to |
| | | December 2008 | December 2007 | 30 June 2008 |
| | Notes | GBP'000 | GBP'000 | GBP'000 |
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Revenue-Continuing operations | | | | |
| | 4 | 71,140 | 63,633 | 136,418 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Employee benefits expense | | (42,018) | (34,447) | (71,192) |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Other operating charges | | (24,130) | (24,084) | (54,394) |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Operating expenses | | (66,148) | (58,531) | (125,586) |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Earnings before interest, taxes, | | | | |
| depreciation and amortisation | | | | |
| (EBITDA) | | 4,992 | 5,102 | 10,832 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Depreciation of property, plant | | | | |
| and equipment | | (974) | (819) | (1,694) |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Amortisation of other intangible | | | | |
| assets | | (447) | (333) | (824) |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Operating profit | 4 | 3,571 | 3,950 | 8,314 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Interest payable | | (747) | (839) | (1,694) |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Interest receivable | | 255 | 214 | 371 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Profit before taxation | | 3,079 | 3,325 | 6,991 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Taxation | 5 | (923) | (974) | (2,386) |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Profit for the financial period | | | | |
| from continuing operations | | 2,156 | 2,351 | 4,605 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Profit attributable to Equity | | | | |
| shareholders | | 1,858 | 2,250 | 3,756 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Profit attributable to Minority | | | | |
| Interests | | 298 | 101 | 849 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | 2,156 | 2,351 | 4,605 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Basic earnings per share | 6 | 6.3p | 7.8p | 12.9p |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Diluted earnings per share | 6 | 6.2p | 7.6p | 12.6p |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Dividend paid per share | 7 | 3.8p | 3.6p | 6.1p |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Dividend proposed per share | 7 | 1.3p | 2.5p | 3.8p |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| |
| Included within amortisation of other intangible assets is a charge of GBP242,000 (2007: GBP184,000) in |
| respect of acquired intangible assets, a non-cash item. The write back of this expense would, after |
| taxation, increase basic earnings per share by 0.6p to 6.9p (2007: 8.2p) and diluted earnings per share by |
| 0.5p to 6.7p (2007: 8.0p). |
+----------------------------------+----------+--------------------+--------------------+--------------------+
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Consolidated Balance Sheet |
| as at 31 December 2008 |
+------------------------------------------------------------------------------------------------------------+
| | | Unaudited | Unaudited | Audited |
| | | Six months to 31 | Six months to 31 | Twelve months to |
| | | December 2008 | December 2007 | 30 June 2008 |
| | | GBP'000 | GBP'000 | GBP'000 |
| | Notes | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Assets | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Non-current assets | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Goodwill | | 17,187 | 16,942 | 17,186 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Other intangible assets | 8 | 2,827 | 2,366 | 3,021 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Property, plant and equipment | 8 | 14,886 | 14,500 | 14,787 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Loan and receivables | | 10 | 10 | 10 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Deferred tax asset | | 363 | 411 | 363 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | 35,273 | 34,229 | 35,367 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Current assets | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Trade and other receivables | 9 | 73,813 | 56,048 | 61,430 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Cash and cash equivalents | | 5,516 | 8,385 | 5,929 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | 79,329 | 64,433 | 67,359 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Total assets | | 114,602 | 98,662 | 102,726 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Liabilities | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Current liabilities | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Trade and other payables | | 50,015 | 39,193 | 40,617 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Financial liabilities - | 10 | 4,609 | 3,528 | 3,891 |
| borrowings | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Current tax liability | | 564 | 1,068 | 861 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | 55,188 | 43,789 | 45,369 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Non-current liabilities | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Financial liabilities - | 10 | 13,341 | 14,958 | 14,535 |
| borrowings | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Provisions | 11 | 4,923 | 3,549 | 4,340 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Deferred tax liability | | 1,994 | 1,766 | 1,983 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | 20,258 | 20,273 | 20,858 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Total liabilities | | 75,446 | 64,062 | 66,227 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Net assets | | 39,156 | 34,600 | 36,499 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Shareholders' equity | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Share capital | 12 | 2,952 | 2,906 | 2,910 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Share premium reserve | | 11,857 | 11,816 | 11,832 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Merger reserve | 13 | 2,789 | 2,358 | 2,358 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Revaluation reserve | | 1,491 | 1,491 | 1,491 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Profit and loss reserve | | 18,263 | 15,041 | 16,250 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Total shareholders' equity | | 37,352 | 33,612 | 34,841 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| | | | | |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Minority interest | | 1,804 | 988 | 1,658 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
| Total equity | | 39,156 | 34,600 | 36,499 |
+----------------------------------+----------+--------------------+--------------------+--------------------+
+-------------------------------------------+--------+----------------+----------------+--------------------+
| |
| Consolidated Cash Flow Statement |
| for the six months ended 31 December 2008 |
+-----------------------------------------------------------------------------------------------------------+
| | | | | |
| | | Unaudited | Unaudited | Audited |
| | | Six months to | Six months to | Twelve months to |
| | | 31 December | 31 December | 30 June |
| | | 2008 | 2007 | 2008 |
| | Notes | GBP'000 | GBP'000 | GBP'000 |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Cash flows from operating activities | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Cash generated from operations | 14a | 3,613 | 5,747 | 8,386 |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Interest paid | | (630) | (378) | (1,012) |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Interest received | | 255 | 214 | 371 |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Tax paid | | (1,191) | (521) | (2,083) |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Net cash from operating activities | | 2,047 | 5,062 | 5,662 |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Cash flows from investing activities | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Acquisition of subsidiary undertakings | | - | (1,302) | (1,571) |
| net of cash acquired | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Deferred consideration paid | | (831) | (1,511) | (1,521) |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Purchase of other intangible assets | | (258) | (145) | (780) |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Purchase of property, plant and equipment | | (750) | (1,286) | (2,184) |
| (PPE) | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Proceeds from sale of PPE and other | | 5 | 4 | 18 |
| intangible assets | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Net cash used in investing activities | | (1,834) | (4,240) | (6,038) |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Cash flows from financing activities | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Share issues | | 32 | 67 | 87 |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Net proceeds from issue of new bank loans | | - | 2,000 | 2,000 |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Repayment of borrowing | | (382) | (501) | (856) |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Repayments on finance leases | | (20) | (7) | (41) |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Equity dividends paid | | (1,356) | (1,296) | (2,071) |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Purchase of shares by Waterman Trustees | | (349) | (213) | (269) |
| Limited | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Net cash from financing activities | | (2,075) | 50 | (1,150) |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Net (decrease) / increase in cash and | | (1,862) | 872 | (1,526) |
| cash equivalents | | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Effect of exchange rate changes | | 450 | 190 | 323 |
+-------------------------------------------+--------+----------------+----------------+--------------------+
| Net increase in cash and cash equivalents | | (1,412) | 1,062 | (1,203) |
| | 14b | | | |
+-------------------------------------------+--------+----------------+----------------+--------------------+
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Consolidated Statement of Changes in Shareholders' Equity |
| as at 31 December 2008 |
+---------------------------------------------------------------------------------------------------------------------------------+
| | | | | | | Total | | |
| | | Share | | | Profit | share- | | |
| | Share | premium | Merger | Revaluation | and loss | holders' | Minority | Total |
| | capital | reserve | reserve | reserve GBP'000 | reserve | equity | Interest | equity |
| | GBP'000 | GBP'000 | GBP'000 | | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Balance at 1 July 2007 | 2,879 | 11,764 | 2,170 | 1,491 | 13,180 | 31,484 | 864 | 32,348 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| | | | | | | | | |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Currency translation | - | - | - | - | 505 | 505 | 32 | 537 |
| adjustments | | | | | | | | |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Share based payments charge | - | - | - | - | 121 | 121 | - | 121 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Adjustment in respect of Share | - | - | - | - | 98 | 98 | - | 98 |
| Incentive Plan | | | | | | | | |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Loss on disposal of own shares | - | - | - | - | (21) | (21) | - | (21) |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Minority interest share of | | | | | | | | |
| intangibles acquired on AHW | | | | | | | | |
| (Victoria) Pty Ltd acquisition | - | - | - | - | - | - | 195 | 195 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Net income recognised directly | - | - | - | - | 703 | 703 | 227 | 930 |
| in equity | | | | | | | | |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| New ordinary shares issued | 27 | 52 | 188 | - | - | 267 | - | 267 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Profit for the financial period | - | - | - | - | 2,250 | 2,250 | 101 | 2,351 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Dividend | - | - | - | - | (1,092) | (1,092) | (204) | (1,296) |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Balance at 31 December 2007 | 2,906 | 11,816 | 2,358 | 1,491 | 15,041 | 33,612 | 988 | 34,600 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| | - | - | - | - | 449 | 449 | 215 | 664 |
| Currency translation | | | | | | | | |
| adjustments | | | | | | | | |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Deferred tax charge for the | - | - | - | - | (158) | (158) | - | (158) |
| period | | | | | | | | |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Share based payments charge | - | - | - | - | 146 | 146 | - | 146 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Adjustment in respect of Share | - | - | - | - | (56) | (56) | - | (56) |
| Incentive Plan | | | | | | | | |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Loss on disposal of own shares | - | - | - | - | (1) | (1) | - | (1) |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Derecognition of minority | - | - | - | - | - | - | (195) | (195) |
| interest share of intangibles | | | | | | | | |
| acquired on acquisition of AHW | | | | | | | | |
| (Victoria) Pty Ltd. | | | | | | | | |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Net income recognised directly | - | - | - | - | 380 | 380 | 20 | 400 |
| in equity | | | | | | | | |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| New ordinary shares issued | 4 | 16 | - | - | - | 20 | - | 20 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Profit for the financial period | - | - | - | - | 1,506 | 1,506 | 748 | 2,254 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Dividend | - | - | - | - | (677) | (677) | (98) | (775) |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Balance at 30 June 2008 | 2,910 | 11,832 | 2,358 | 1,491 | 16,250 | 34,841 | 1,658 | 36,499 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| | - | - | - | - | 1,362 | 1,362 | 97 | 1,459 |
| Currency translation | | | | | | | | |
| adjustments | | | | | | | | |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Share based payments charge | - | - | - | - | 140 | 140 | - | 140 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Adjustment in respect of Share | - | - | - | - | (182) | (182) | - | (182) |
| Incentive Plan | | | | | | | | |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Loss on disposal of own shares | - | - | - | - | (58) | (58) | - | (58) |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Net income recognised directly | - | - | - | - | 1,262 | 1,262 | 97 | 1,359 |
| in equity | | | | | | | | |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| New ordinary shares issued | 42 | 25 | 431 | - | - | 498 | - | 498 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Profit for the financial period | - | - | - | - | 1,858 | 1,858 | 298 | 2,156 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Dividend | - | - | - | - | (1,107) | (1,107) | (249) | (1,356) |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| Balance at 31 December2008 | 2,952 | 11,857 | 2,789 | 1,491 | 18,263 | 37,352 | 1,804 | 39,156 |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
| | | | | | | | | |
+---------------------------------+----------+----------+----------+------------------+----------+----------+----------+----------+
Notes to Financial Information
for the six months ended 31 December 2008
1. General information
The company is a limited liability company incorporated and domiciled in the UK.
The address of its registered office is Pickfords Wharf, Clink Street, London
SE1 9DG.The company has its listing on the London Stock Exchange.
This condensed consolidated half-yearly financial information was approved for
issue on 23 February 2009.
These interim financial results do not comprise statutory accounts within the
meaning of Section 240 of the Companies Act 1985.Statutory accounts for the year
ended 30 June 2008 were approved by the Board of Directors on 22 October 2008
and delivered to the Registrar of Companies. The report of the auditors on those
accounts was unqualified, did not contain an emphasis of matter paragraph and
did not contain any statement under Section 237 of the Companies Act 2005.
2. Basis of preparation
This condensed unaudited consolidated financial information for the half year
ended 31 December 2008 has been prepared in accordance with the Disclosure and
Transparency Rules of the Financial Services Authority and with IAS 34 'Interim
Financial Reporting ' as adopted by the European Union (EU).The half year
condensed consolidated financial report should be read in conjunction with the
annual financial statements for the year ended 30 June 2008, which have been
prepared in accordance with International Financial Reporting Standards (IFRS)
as adopted by the EU.
The condensed unaudited consolidated half yearly financial statements have been
prepared in accordance with IFRS as adopted by the EU, and those parts of the
Companies Act 1985 related to reporting under IFRS that the directors expect to
be applicable as at 30 June 2009. IFRS are subject to amendment or
interpretation by the International Accounting Standards Board and there is an
ongoing process of review and endorsement by the EU. For these reasons, it is
possible that the information presented in this report may be subject to change.
The preparation of financial statements in conformity with generally accepted
accounting principles requires the use of estimates and assumptions that affect
the reported amounts of assets and liabilities at the dates of the financial
statements and the reported amounts of revenue and expenses during the reported
period. Although these estimates are based on management's best knowledge of the
amount, events or actions, actual results ultimately may differ from those
estimates.
3. Accounting policies
The accounting policies adopted are consistent with those of the annual
financial statements for the year ended 30 June 2008, as described in those
annual financial statements.
The Group intends to finalise any fair value adjustments in accordance with IFRS
3 within one year of the relevant acquisition date and any adjustments required
will be reported in the annual financial statements.
4. Segmental information
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Six months ended 31 December 2008 |
| Consolidated Income Statement |
| |
+----------------------------------------------------------------------------------------------------------+
| | Building | Civil and | Environmental | Structures | International | Total |
| | services | transportation | consultancy | GBP '000 | multi-disciplinary | GBP'000 |
| | GBP '000 | GBP '000 | GBP '000 | | GBP '000 | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Revenue - total | 7,141 | 23,665 | 7,721 | 12,155 | 38,003 | 88,685 |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Revenue- | (410) | (752) | (850) | (1,261) | (14,272) | (17,545) |
| internal | | | | | | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Revenue | 6,731 | 22,913 | 6,871 | 10,894 | 23,731 | 71,140 |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| EBITDA | 321 | 2,022 | (219) | 955 | 1,913 | 4,992 |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Depreciation | (64) | (295) | (63) | (97) | (455) | (974) |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Amortisation | (45) | (226) | (22) | (25) | (129) | (447) |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Operating | 212 | 1,501 | (304) | 833 | 1,329 | 3,571 |
| profit | | | | | | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Net finance | | | | | | (492) |
| costs | | | | | | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Profit before | | | | | | 3,079 |
| taxation | | | | | | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Taxation | | | | | | (923) |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Profit | | | | | | (298) |
| attributable to | | | | | | |
| minority | | | | | | |
| interests | | | | | | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Profit | | | | | | 1,858 |
| attributable to | | | | | | |
| equity | | | | | | |
| shareholders | | | | | | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Six months ended 31 December 2007 |
| Consolidated Income Statement |
| |
+----------------------------------------------------------------------------------------------------------+
| | Building | Civil and | Environmental | Structures | International | Total |
| | services | transportation | consultancy | GBP '000 | multi-disciplinary | GBP'000 |
| | GBP '000 | GBP '000 | GBP '000 | | GBP '000 | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Revenue - total | 5,984 | 22,489 | 8,119 | 14,266 | 19,981 | 70,839 |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Revenue - | (37) | (766) | (781) | (2,014) | (3,608) | (7,206) |
| internal | | | | | | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Revenue | 5,947 | 21,723 | 7,338 | 12,252 | 16,373 | 63,633 |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| EBITDA | 414 | 2,143 | 455 | 1,192 | 898 | 5,102 |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Depreciation | (65) | (256) | (78) | (112) | (308) | (819) |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Amortisation | (9) | (182) | (19) | (30) | (93) | (333) |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Operating | 340 | 1,705 | 358 | 1,050 | 497 | 3,950 |
| profit | | | | | | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Net finance | | | | | | (625) |
| costs | | | | | | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Profit before | | | | | | 3,325 |
| taxation | | | | | | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Taxation | | | | | | (974) |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Profit | | | | | | (101) |
| attributable to | | | | | | |
| minority | | | | | | |
| interests | | | | | | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
| Profit | | | | | | 2,250 |
| attributable to | | | | | | |
| equity | | | | | | |
| shareholders | | | | | | |
+-----------------+----------+----------------+---------------+------------+--------------------+----------+
5. Taxation
Taxation for the six months ended 31 December 2008 has been calculated at 30%
(2007: 29.2%) of the profit before taxation being the estimated effective rate
for the year. The effective rate for the period has increased due to the change
in the mix of the profits between the different jurisdictions in which the Group
operates.
6. Earnings per share
The basic earnings per share has been calculated on the profit attributable to
shareholders and based on the weighted average of 29,475,159 shares in issue
during the period and ranking for dividend (31 December 2007: 28,950,581 and 30
June 2008: 29,017,933).The fully diluted earnings per share also takes account
of unexercised options potentially convertible into new ordinary shares and
shares conditionally awarded in accordance with the Long Term Incentive
Plan. The calculation is based on a weighted average of 29,982,886 shares during
the period (31 December 2007: 29,636,167 and 30 June 2008: 29,733,287).
7. Dividends
The directors propose an interim dividend of 1.3p per share (December 2007: 2.5p
per share).The shares become ex-dividend on 18 March 2009 and the dividend will
be paid on 21 April 2009 to those shareholders on the register at the close of
business on 20 March 2009.
+---------------------------------+--+--------------+--------------+---------------+
| | | Unaudited | Unaudited | Audited |
| | | Six months | Six months | Year ended 30 |
| | | to | to | June |
| | | 31 December | 31 December | 2008 |
| | | 2008 | 2007 | GBP'000 |
| | | GBP'000 | GBP'000 | |
+---------------------------------+--+--------------+--------------+---------------+
| Dividends charged to equity in | | 1,108 | 1,092 | 1,769 |
| the period | | | | |
+---------------------------------+--+--------------+--------------+---------------+
| Dividend per ordinary share | | 3.8p | 3.6p | 6.1p |
| paid in period | | | | |
+---------------------------------+--+--------------+--------------+---------------+
8. Capital expenditure
+-----------------------------------------------------------+---------------------+
| | PPE and Other |
| | intangible assets |
| | GBP'000 |
+-----------------------------------------------------------+---------------------+
| Six months ended 31 December 2008 | |
+-----------------------------------------------------------+---------------------+
| Opening net book amount at 1 July 2008 | 17,808 |
+-----------------------------------------------------------+---------------------+
| Additions | 1,008 |
+-----------------------------------------------------------+---------------------+
| Disposals | - |
+-----------------------------------------------------------+---------------------+
| Exchange rate adjustments | 318 |
+-----------------------------------------------------------+---------------------+
| Depreciation and amortisation | (1,421) |
+-----------------------------------------------------------+---------------------+
| Closing net book amount at 31 December 2008 | 17,713 |
+-----------------------------------------------------------+---------------------+
| | |
+-----------------------------------------------------------+---------------------+
| Six months ended 31 December 2007 | |
+-----------------------------------------------------------+---------------------+
| Opening net book amount at 1 July 2007 | 16,482 |
+-----------------------------------------------------------+---------------------+
| Additions | 1,431 |
+-----------------------------------------------------------+---------------------+
| Disposals | - |
+-----------------------------------------------------------+---------------------+
| Acquisitions through business combinations | 34 |
+-----------------------------------------------------------+---------------------+
| Exchange rate adjustments | 71 |
+-----------------------------------------------------------+---------------------+
| Depreciation and amortisation | (1,152) |
+-----------------------------------------------------------+---------------------+
| Closing net book amount at 31 December 2007 | 16,866 |
+-----------------------------------------------------------+---------------------+
| | |
+-----------------------------------------------------------+---------------------+
9. Trade and other receivables
As of 31 December 2008, trade receivables, net of provisions were GBP45.4m (30
June 2008: GBP40.6m) of which GBP33.1m (30 June 2008: GBP24.1m) were more than
30 days old but not impaired. These relate to a number of independent UK and
overseas customers for whom there is no recent history of default.
10. Financial liabilities-borrowings
+-------------------------------------+------------------------+----------------------+---+----------------+
| | 31 December 2008 | 31 December 2007 | | 30 June 2008 |
| | GBP'000 | GBP'000 | | GBP'000 |
+-------------------------------------+------------------------+----------------------+---+----------------+
| Current | | | | |
+-------------------------------------+------------------------+----------------------+---+----------------+
| Bank loans | 1,060 | 970 | | 990 |
+-------------------------------------+------------------------+----------------------+---+----------------+
| Bank overdrafts | 2,334 | 1,526 | | 1,335 |
+-------------------------------------+------------------------+----------------------+---+----------------+
| Finance leases | 51 | 6 | | 45 |
+-------------------------------------+------------------------+----------------------+---+----------------+
| Deferred consideration | 1,164 | 1,026 | | 1,521 |
+-------------------------------------+------------------------+----------------------+---+----------------+
| | 4,609 | 3,528 | | 3,891 |
+-------------------------------------+------------------------+----------------------+---+----------------+
| | | | | |
+-------------------------------------+------------------------+----------------------+---+----------------+
| Non-current | | | | |
+-------------------------------------+------------------------+----------------------+---+----------------+
| Bank loans | 11,983 | 12,699 | | 12,353 |
+-------------------------------------+------------------------+----------------------+---+----------------+
| Finance leases | 120 | 1 | | 113 |
+-------------------------------------+------------------------+----------------------+---+----------------+
| Deferred consideration | 1,238 | 2,258 | | 2,069 |
+-------------------------------------+------------------------+----------------------+---+----------------+
| | 13,341 | 14,958 | | 14,535 |
+-------------------------------------+------------------------+----------------------+---+----------------+
| | 17,950 | 18,486 | | 18,426 |
| Total | | | | |
+-------------------------------------+------------------------+----------------------+---+----------------+
Movements in financial liabilities-borrowings are analysed as follows:
+----------------------------------------------------------+-------------------+
| | GBP'000 |
+----------------------------------------------------------+-------------------+
| Six months ended 31 December 2008 | |
+----------------------------------------------------------+-------------------+
| Opening amount as at 1 July 2008 | 18,426 |
+----------------------------------------------------------+-------------------+
| Increase in bank overdrafts | 999 |
+----------------------------------------------------------+-------------------+
| Net repayment of borrowing | (402) |
+----------------------------------------------------------+-------------------+
| Settlement of deferred consideration arising on | (15) |
| acquisition of Furness Green Ltd. | |
+----------------------------------------------------------+-------------------+
| Settlement of part of deferred consideration arising on | (1,283) |
| acquisition of Waterman Boreham Ltd and AHW (Victoria) | |
| Pty Ltd. | |
+----------------------------------------------------------+-------------------+
| Unwinding of discount on deferred consideration | 103 |
+----------------------------------------------------------+-------------------+
| Exchange rate adjustments | 122 |
+----------------------------------------------------------+-------------------+
| Closing amount as at 31 December 2008 | 17,950 |
+----------------------------------------------------------+-------------------+
| | |
+----------------------------------------------------------+-------------------+
| Six months ended 31 December 2007 | |
+----------------------------------------------------------+-------------------+
| Opening amount as at 1 July 2007 | 16,771 |
+----------------------------------------------------------+-------------------+
| Increase in bank overdrafts | 1,102 |
+----------------------------------------------------------+-------------------+
| New bank loans | 2,000 |
+----------------------------------------------------------+-------------------+
| Net repayment of borrowing | (186) |
+----------------------------------------------------------+-------------------+
| Finance leases acquired through business combinations | - |
+----------------------------------------------------------+-------------------+
| Deferred consideration arising on acquisition of Furness | 310 |
| Green Ltd | |
+----------------------------------------------------------+-------------------+
| Settlement of part of deferred consideration arising on | (1.511) |
| acquisition of Waterman Boreham Ltd and AHW (Victoria) | |
| Pty Ltd. | |
+----------------------------------------------------------+-------------------+
| Closing amount as at 31 December 2007 | 18,486 |
+----------------------------------------------------------+-------------------+
11. Provisions
+------------------------------------------------------------------------------+----------------------------+
| | Liability insurance |
| | provision |
| | GBP'000 |
+------------------------------------------------------------------------------+----------------------------+
| Six months ended 31 December 2008 | |
+------------------------------------------------------------------------------+----------------------------+
| Opening amount as at 1 July 2008 | 4,340 |
+------------------------------------------------------------------------------+----------------------------+
| Charged to the consolidated income statement | 880 |
+------------------------------------------------------------------------------+----------------------------+
| Utilised | (296) |
+------------------------------------------------------------------------------+----------------------------+
| Released | (91) |
+------------------------------------------------------------------------------+----------------------------+
| Unwinding of discount | 90 |
+------------------------------------------------------------------------------+----------------------------+
| Closing amount as at 31 December 2008 | 4,923 |
+------------------------------------------------------------------------------+----------------------------+
| | |
+------------------------------------------------------------------------------+----------------------------+
| Six months ended 31 December 2007 | |
+------------------------------------------------------------------------------+----------------------------+
| Opening amount as at 1 July 2007 | 2,915 |
+------------------------------------------------------------------------------+----------------------------+
| Charged to the consolidated income statement | 3,064 |
+------------------------------------------------------------------------------+----------------------------+
| Utilised | (430) |
+------------------------------------------------------------------------------+----------------------------+
| Released | (2,043) |
+------------------------------------------------------------------------------+----------------------------+
| Unwinding of discount | 43 |
+------------------------------------------------------------------------------+----------------------------+
| Closing amount as at 31 December 2007 | 3,549 |
+------------------------------------------------------------------------------+----------------------------+
| | |
+------------------------------------------------------------------------------+----------------------------+
12. Share capital
The share capital of the Company comprises ordinary shares of 10p each. Shares
were issued during the period at an issue price ranging from 44.5p to
164.5p (2006: 44.5p to 50p) and a weighted average share price of 120.7p (2007:
98.9p).
+------------------------------------------------+--------+---------+--------+---------+
| Six months ended 31 December 2008 | Authorised | Issued and |
| | | fully paid |
+------------------------------------------------+------------------+------------------+
| | No | GBP'000 | No | GBP'000 |
| | '000 | | '000 | |
+------------------------------------------------+--------+---------+--------+---------+
| At 1 July 2008 | 41,000 | 4,100 | 29,104 | 2,910 |
+------------------------------------------------+--------+---------+--------+---------+
| Issued during the year in respect of share | - | - | 65 | 7 |
| option schemes | | | | |
+------------------------------------------------+--------+---------+--------+---------+
| Issued as part of the deferred consideration | - | - | 348 | 35 |
| for the | | | | |
| acquisition of Waterman Boreham Ltd. | | | | |
+------------------------------------------------+--------+---------+--------+---------+
| At 31 December 2008 | 41,000 | 4,100 | 29,517 | 2,952 |
+------------------------------------------------+--------+---------+--------+---------+
+------------------------------------------------+--------+----------+--------+---------+
| Six months ended 31 December 2007 | Authorised | Issued and |
| | | fully paid |
+------------------------------------------------+-------------------+------------------+
| | No | GBP'000 | No | GBP'000 |
| | '000 | | '000 | |
+------------------------------------------------+--------+----------+--------+---------+
| At 1 July 2007 | 41,000 | 4,100 | 28,791 | 2,879 |
+------------------------------------------------+--------+----------+--------+---------+
| Issued during the year in respect of share | - | - | 149 | 15 |
| option schemes | | | | |
+------------------------------------------------+--------+----------+--------+---------+
| Issued as part of the deferred consideration | - | - | 121 | 12 |
| for the | | | | |
| acquisition of Furness Green Ltd | | | | |
+------------------------------------------------+--------+----------+--------+---------+
| At 31 December 2007 | 41,000 | 4,100 | 29,061 | 2,906 |
+------------------------------------------------+--------+----------+--------+---------+
13. Merger Reserve
The merger reserve arises from the issue of shares at a premium in accordance
with S.131 of Companies Act 1985. Included within the profit and loss reserve
balance brought forward is an amount of GBP1,133,000 (2007: GBP1,133,000)
relating to the write off of purchased goodwill prior to the introduction of FRS
10.
14. Notes to the Consolidated Cash Flow Statement
+-----------------------------------------+--------------+--------------+-------------+
| a) Reconciliation of profit for the financial period to cash generated from |
| operations |
+-------------------------------------------------------------------------------------+
| | Unaudited | Unaudited | Audited |
| | Six months | Six months | Twelve |
| | to | to | months to |
| | 31 December | 31 December | 30 June |
| | 2008 | 2007 | 2008 |
| | GBP'000 | GBP'000 | GBP'000 |
| | | | |
+-----------------------------------------+--------------+--------------+-------------+
| Profit for the financial period | 2,156 | 2,351 | 4,605 |
+-----------------------------------------+--------------+--------------+-------------+
| Taxation | 923 | 974 | 2,386 |
+-----------------------------------------+--------------+--------------+-------------+
| Interest payable | 747 | 839 | 1,694 |
+-----------------------------------------+--------------+--------------+-------------+
| Interest receivable | (255) | (214) | (371) |
+-----------------------------------------+--------------+--------------+-------------+
| Amortisation of other intangible assets | 447 | 333 | 824 |
+-----------------------------------------+--------------+--------------+-------------+
| Depreciation | 974 | 819 | 1,694 |
+-----------------------------------------+--------------+--------------+-------------+
| Profit on disposal of PPE and other | (5) | (4) | (9) |
| intangible assets | | | |
+-----------------------------------------+--------------+--------------+-------------+
| Shares granted under the Share | - | 290 | 290 |
| Incentive Plan | | | |
+-----------------------------------------+--------------+--------------+-------------+
| Share based payments charge | 140 | 121 | 267 |
+-----------------------------------------+--------------+--------------+-------------+
| Changes in working capital | | | |
+-----------------------------------------+--------------+--------------+-------------+
| Increase in Trade and other | (9,402) | (3,123) | (8,091) |
| receivables | | | |
+-----------------------------------------+--------------+--------------+-------------+
| Increase in Trade and other payables | 7,319 | 2,883 | 3,906 |
+-----------------------------------------+--------------+--------------+-------------+
| Increase in Provisions | 569 | 478 | 1,191 |
| | | | |
+-----------------------------------------+--------------+--------------+-------------+
| Cash generated from operations | 3,613 | 5,747 | 8,386 |
+-----------------------------------------+--------------+--------------+-------------+
+-------------------+------------+----------+----------+----------+-----------+------------+
| b) Analysis of net debt |
+------------------------------------------------------------------------------------------+
| | 31 | 30 June | | Other | | 31 |
| | December | 2008 | Cash | non-cash | Exchange | December |
| | 2007 | GBP'000 | flow | changes | movements | 2008 |
| | GBP'000 | | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
| | | | | | | |
+-------------------+------------+----------+----------+----------+-----------+------------+
| Cash balances | 8,385 | 5,929 | (863) | - | 450 | 5,516 |
+-------------------+------------+----------+----------+----------+-----------+------------+
| Bank overdrafts | (1,526) | (1,335) | (999) | - | - | (2,334) |
+-------------------+------------+----------+----------+----------+-----------+------------+
| Cash and cash | 6,859 | 4,594 | (1,862) | - | 450 | 3,182 |
| equivalents | | | | | | |
| | | | | | | |
+-------------------+------------+----------+----------+----------+-----------+------------+
| Current | | | | | | |
+-------------------+------------+----------+----------+----------+-----------+------------+
| Bank loans | (970) | (990) | 382 | (370) | (82) | (1,060) |
+-------------------+------------+----------+----------+----------+-----------+------------+
| Finance leases | (6) | (45) | 20 | (11) | (15) | (51) |
+-------------------+------------+----------+----------+----------+-----------+------------+
| Deferred | (1,026) | (1,521) | 831 | (467) | (7) | (1,164) |
| consideration | | | | | | |
+-------------------+------------+----------+----------+----------+-----------+------------+
| | | | | | | |
+-------------------+------------+----------+----------+----------+-----------+------------+
| Non-current | | | | | | |
+-------------------+------------+----------+----------+----------+-----------+------------+
| Bank loans | (12,699) | (12,353) | - | 370 | - | (11,983) |
+-------------------+------------+----------+----------+----------+-----------+------------+
| Finance leases | (1) | (113) | - | 11 | (18) | (120) |
+-------------------+------------+----------+----------+----------+-----------+------------+
| Deferred | | | | | | |
| consideration | (2,258) | (2,069) | - | 831 | - | (1,238) |
+-------------------+------------+----------+----------+----------+-----------+------------+
| | | | | | | |
+-------------------+------------+----------+----------+----------+-----------+------------+
| Net debt | (10,101) | (12,497) | (629) | 364 | 328 | (12,434) |
+-------------------+------------+----------+----------+----------+-----------+------------+
15. Related party transactions
The directors have identified 19 (2007: 19) key management personnel whose
compensation was as follows: -
+------------------------------------------------+--------------+---------------+
| | 2008 | 2007 |
| | GBP'000 | GBP'000 |
+------------------------------------------------+--------------+---------------+
| Short term benefits | 1,464 | 1,416 |
+------------------------------------------------+--------------+---------------+
| Charge in respect of share based payments | 82 | 59 |
+------------------------------------------------+--------------+---------------+
| Post employment benefits | 101 | 94 |
+------------------------------------------------+--------------+---------------+
| | 1,647 | 1,569 |
+------------------------------------------------+--------------+---------------+
16. Going concern
The group's business activities, together with the factors likely to affect its
future development, performance and position are set out in the Interim
Management Statement. The financial position of the group, its cash flows,
liquidity position and borrowing facilities are described in the financial
statements and notes.
The group has considerable financial resources together with long term contracts
with a number of customers and suppliers across different geographic areas and
industries. As a consequence, the directors believe that the group is well
placed to manage its business risks successfully despite the current uncertain
economic outlook.
After making enquiries, the directors have a reasonable expectation that the
company and the group have adequate resources to continue in operational
existence for the foreseeable future. Accordingly, they continue to adopt the
going concern basis in preparing the interim report and financial statements.
17. Principal risks and uncertainties
The principal risks and uncertainties affecting the business activities of the
Group remain broadly the same as at 30 June 2008 which are disclosed within note
1 to the Waterman Group plc Annual Report and Financial Statement 2008.
18. Further information
Copies of the Interim Report will be sent to shareholders. Additional copies
will be available from the Company's registered office at Pickfords Wharf, Clink
Street, London SE1 9DG. In addition, electronic copies of the Interim Report
will be made available on the Group's website and the 30 June 2008 financial
statements can be viewed on the Group's website www.watermangroup.com
The directors are responsible for the maintenance and integrity of the Group's
website on the internet. However, information is accessible in many different
countries where legislation governing the preparation and dissemination of
financial information may differ to that applicable to the United Kingdom.
Statement of Directors' Responsibilities
The directors confirm that this condensed set of financial statements has been
prepared in accordance with IAS 34 as adopted by the European Union, and that
the Interim Management Report herein includes a fair review of the information
required by DTR 4.2.7 and DTR 4.2.8.
The directors of Waterman Group plc are listed in the Waterman Group plc Annual
Report and Financial Statement 2007.There have been no changes of directors
since the Annual Report. A list of current directors is maintained on the
Waterman Group website www.watermangroup.com
By order of the Board
Graham R Hiscocks
Company Secretary
23 February 2009
Independent review report to Waterman Group plc
For the six months ending 31 December 2008
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 31
December 2008, which comprises the consolidated income statement, consolidated
balance sheet, consolidated statement of changes in equity, consolidated cash
flow statement and related 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.
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 Disclosure and Transparency Rules of the
United Kingdom's Financial Services Authority.
As disclosed in note 2, the annual financial statements of the group are
prepared in accordance with IFRSs as adopted by the European Union. The
condensed set of financial statements included in this half-yearly financial
report has been prepared in accordance with International Accounting Standard
34, "Interim Financial Reporting", as adopted by the European Union.
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. This report, including the conclusion, has been prepared for and only
for the company for the purpose of the Disclosure and Transparency Rules of the
Financial Services Authority and for no other purpose. We do not, in producing
this report, accept or assume responsibility for any other purpose or to any
other person to whom this report is shown or into whose hands it may come save
where expressly agreed by our prior consent in writing.
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 United Kingdom. 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 31 December 2008 is not prepared, in all
material respects, in accordance with International Accounting Standard 34 as
adopted by the European Union and the Disclosure and Transparency Rules of the
United Kingdom's Financial Services Authority.
PricewaterhouseCoopers LLP
Chartered Accountants
London
23 February 2009
This information is provided by RNS
The company news service from the London Stock Exchange
END
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