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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Trifast Plc | LSE:TRI | London | Ordinary Share | GB0008883927 | ORD 5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 76.00 | 75.20 | 77.00 | 77.00 | 76.00 | 76.00 | 73,887 | 16:35:25 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Manufacturing Industries,nec | 244.39M | -2.87M | -0.0213 | -36.15 | 103.68M |
From Apr 2019 to Apr 2024
TIDMTRI
RNS Number : 6526W
Trifast PLC
11 November 2014
Hot Features
Premium
Tuesday, 11 November
2014
Immediate release
Half-yearly financial report for the six months ended 30 September 2014
"Solid underlying organic growth - best trading period ever"
"The Board remains optimistic about the Group's outlook
and expects trading to exceed its expectations for the financial year"
Key financials Change Half-year Half-year Full year
Continuing operations HY 2014 30.9.14 30.9.13 31.3.14
v
HY 2013
Ø Group revenue +13.4% GBP74.03m GBP65.26m GBP129.78m
Ø Gross profit % +130bps 29.0% 27.7% 27.7%
Ø Operating profit +45.6% GBP7.07m GBP4.86m GBP9.70m
before separately disclosed
items
Ø Operating profit +15.9% GBP5.39m GBP4.65m GBP9.41m
Ø Pre-tax profit before +45.6% GBP6.63m GBP4.55m GBP9.16m
separately disclosed items
Ø Pre-tax profit +13.8% GBP4.94m GBP4.34m GBP8.87m
Ø Adjusted diluted
earnings per share +39.5% 4.10p 2.94p 5.95p
Ø Basic earnings per
share +1.3% 3.10p 3.06p 6.08p
Ø Dividend - -
-interim +50.0% 0.60p 0.40p 1.40p
Ø Net (debt) / cash (GBP17.53m) GBP3.55m GBP2.03m
Ø Return on capital
employed (ROCE) +210bps 17.3% 15.2% 15.5%
----------------------------------- --------- ------------ ---------- -----------
2014 highlights
Ø Best six month's profit in the Company's history
Ø Gross margin up 130bps to 29.0%
Ø Overheads as a percentage of revenue reduced by
80bps to 19.4% over HY2013 period
Ø VIC acquisition in May 2014 has integrated well
and contributed as expected during the period
Ø New investment in manufacturing plant initiated
in Italy, Malaysia and Taiwan
Ø Continue to extend our geographic boundaries in
the USA, Central Europe and Thailand
Ø Additional sales engineers recruited, inducted
and starting to introduce new business
Ø Sales to distributors from Lancaster Fastener
growing well into most of EU
-------------------------------------------------------------
"During the period VIC has performed and integrated well; both VIC and TR management are encouraged by the growth opportunities deriving from sales and marketing working together."
"By recruiting several additional sales engineers for the automotive and telecoms sectors during the first half year, we now have the necessary resources to continue the pace of organic growth. These investments have also been matched with new manufacturing plant for Italy and Asia, thus allowing more production to be placed in-house."
"Meanwhile, margin improvement continues to be driven by on-going operational process efficiencies, particularly in warehouse storage, order picking and packaging. The 'self-help' programme initiated back in 2011 keeps on giving with regard to productivity and cost efficiencies, and clearly forms a solid foundation to the now well established 'continuous improvement' philosophy and culture."
"In late October, we conducted an in-depth audit of our order pipeline and concluded that it was as strong, if not stronger than ever before. However, there are no grounds for complacency as market dynamics can change rapidly."
"The order book position and current levels of organic growth are such that the Board remains optimistic about the Group's outlook and expects trading to exceed its expectations for the financial year as a whole. At the same time the Board continues to identify, approach and assess the next strategic acquisition opportunity through adopting the well proven investment criteria that have recently served Trifast well in Malaysia and Italy."
FULL STATEMENT ATTACHED Results briefing will be held at 12.15pm: The Purple Room, No.1 Cornhill, London EC3V 3ND Conference dial-in facility: on request, please contact +44 (0)7785 703523 or email fiona@tooleystreet.com ---------------------------------------------------------
Trifast plc
Half-yearly financial report
("TR", "Group" or "Trifast")
Six months ended 30 September 2014
STATEMENT BY EXECUTIVE CHAIRMAN, MALCOLM DIAMOND MBE AND CHIEF EXECUTIVE, JIM BARKER
Introduction
Our ambition this year was to continue our pace of organic
growth, to complete on the acquisition of VIC in Italy
and to continue our search and assessment of further
suitable bolt-on acquisitions.
Global market overview & "over 40% sales comes from
TR strategy update global OEMs"
While the recent negative impact of macro-economic data
and political events have affected the financial markets;
within the Group's key customer base, comprising automotive,
electronics/telecom, domestic appliances and fastener
distributors, there has been no evidence of demand contraction.
In late October, we conducted an in-depth audit of our
order pipeline and concluded that it was as strong,
if not stronger than ever before. However, there are
no grounds for complacency as market dynamics can change
rapidly.
Our core business is supplying Multi-national high volume
assembly OEMs around the world with assembly components.
They demand consistent quality, price and availability
in order to supply automotive assemblies, mobile phone
base stations, computer enclosures, cash dispensers
etc. in their often numerous sister plants spread globally.
We are now approved suppliers to over 40 such Multi-nationals,
several of which own over 200 plants making comparable
or identical finished products - yet our average penetration
into each network is at the moment around 10% of their
potential spend in our product range. Supplying Multi-nationals
accounts for over 40% of current Group revenue and developing
this business further is our backbone growth strategy.
This is supplemented by significant sales of our specialist
TR Branded products, next day delivery of a broad range
of more standardised fasteners to UK OEMs and to UK
and EU distributors and our new growing range of lightweight
plastic fasteners and spacers.
We continue to extend our geographic boundaries in the
USA, Central Europe and Thailand as we recruit new personnel
resource in these regions.
Finally, the search for acquisition opportunities never
ceases as we look to supplement organic growth with
meaningful additions to our product range and customer
reach within our strict acquisition criteria for niche
businesses.
Reviewing our 2014 half year "Strong organic and acquisitive
performance growth"
On a constant currency basis the Group has grown organic
revenue by 7.2% (18.7% including VIC), and actual organic
profitability by 11.4% (45.6% including VIC). The acquisition
of VIC was successfully concluded at the end of May
this year and the MD, Carlo Perini has made rapid progress
integrating into the senior management team within Europe
and Asia - especially with new business development.
Our constant pursuit of improved operational efficiencies
continues to yield margin and productivity gains, with
no sign yet of reaching a level of diminishing returns,
thus providing ongoing motivation to our managers to
sustain our drive for 'continuous improvement' of processes
and resource utilisation.
Performance "hot spots" during the period were: sales
of our TR Branded specialist products via Lancaster
Fastener and TR Fastenings to distributors in the UK
and Europe (distributor demand is a reliable "barometer"
of the dynamics within industrial assembly sectors);
Hungary winning extra revenue from the electronics sector;
and both TR UK and Holland gaining strong growth from
the automotive sector in the period.
Our Asian factories continue to make excellent progress
in refining their processes to ensure 'zero-defect'
compliance with customer requirements within the telecoms/electronics
and automotive sectors in order to offer a distinct
competitive advantage.
We are pleased to confirm that, after many years of
caution regarding new investment, the Group is now authorising
expenditure on selective sophisticated component manufacturing
plant in Asia and automated vertical product storage
systems within the UK. We expect a maximum three year
payback on these initiatives due to their high impact
on productivity gains.
During this period we have also invested further in
extensive leadership training programmes for all our
UK main team leaders, as our succession planning objectives
steadily take shape.
Viterie Italia Centrale Srl "widening our offering and
('VIC') sector expertise"
On 30 May 2014, Trifast completed the acquisition of
the entire issued capital stock of VIC, a manufacturer
and distributor of fastenings systems based in Italy.
The initial consideration of EUR27.00 million (GBP22.02m),
was satisfied by EUR24.15 million (GBP19.65m) in cash
and EUR2.85m (GBP2.37m) by the issue and allotment of
3,000,000 shares of 5 pence each in the Company to Carlo
Perini, the Managing Director and 30% owner of VIC.
A further payment may become due to the vendors depending
upon the performance of VIC over the year ending 31
December 2014. If VIC generates an adjusted post-tax
profit (as defined in the Acquisition Agreement) for
the year ending 31 December 2014 which exceeds EUR3.00
million then for each EUR1 above this sum an additional
EUR5 is payable to the vendors, subject to a maximum
amount of EUR5.00 million (GBP4.07m).
VIC is complementary to the Group's business model and
significantly strengthens the Group's presence in the
domestic appliance market whilst also offering TR additional
opportunities in existing electronic and automotive
Tier 1 markets. It will also provide an additional competitive
manufacturing facility in Europe to complement the Group's
existing resources in Asia.
During the period VIC has both performed and integrated
well; both VIC and TR management are encouraged by the
growth opportunities deriving from sales and marketing
working together.
2014 half-year key financials "strong underlying organic
growth"
The Group's revenue in the first six months of the financial
year grew by 13.4% compared to HY 2013. This was largely
due to the acquisition of VIC, which contributed GBP7.51
million during the period ended 30 September 2014. From
an organic growth perspective the Group's revenue was
up 1.9%. However, given that nearly 60% of the Group's
revenue is now derived from its overseas operations
and is earned in foreign currencies, the strong pound
in the first half-year had a detrimental effect on the
trading results compared to HY 2013. On a constant currency
basis, revenue grew by 18.7% and organically by 7.2%.
The effect of currencies on the individual regions is
even more pronounced; TR UK showed organic revenue growth
of 2.1%; TR Asia showed a decline in revenue of 5.9%,
whereas on a constant currency basis it actually grew
by 4.2%; TR Europe (excluding VIC) grew by 11.3% (constant
currency 21.5%) and TR USA by 28.4% (constant currency
39.5%).
Gross profit increased by 130bps from HY 2013 to 29.0%,
this was a combination of better sourcing, increased
turnover over a relatively fixed base and improvement
in warehouse efficiencies. Overheads remain tightly
controlled and are currently running at 19.4% of revenue
(HY 2013: 20.2%).
Group operating profit before separately disclosed items
increased by 45.6% to GBP7.07 million compared to the
same period last year (HY 2013: GBP4.86m). VIC contributed
an operating profit of GBP1.66 million in the period,
resulting in the rest of the Group growing organically
by 11.4%. Organically, Europe grew the most at 52.3%,
giving a contribution return of 8.9% excluding VIC (13.6%
including VIC); TR Hungary and TR Holland performed
exceptionally well, the former on the back of key Multi-national
electronic customers and the latter on automotive business
secured over the previous years. TR UK profits have
grown 13.0% on HY 2013 resulting from the increase in
revenue, better sourcing and continual efficiency improvements;
they are now delivering a 9.1% return. TR Asia's profits
increased by 3.0% due to tight control of overheads
and a reduction in inventory provisioning; TR Asia's
current return is still an impressive 14.0%. TR USA
profits have increased by 9.7%, principally due to the
top line growth which is beginning to expand into the
automotive sector.
During the first half of this financial year the Group
incurred foreign exchange losses of GBP0.36 million
against a gain of GBP0.19m for HY 2013.
Interest costs increased in the period by GBP0.14 million
to GBP0.45 million compared to HY 2013 due to new banking
facilities put in place during the period to fund the
acquisition of VIC. Interest cover (defined as EBITDA
to net finance costs, before one-off separately disclosed
items) remains very strong at 17.1 times (HY 2013: 17.6
times)
For the period under review, the Group incurred GBP1.69
million of separately disclosed items, which in the
Directors' opinion should be shown separately in order
to better understand the underlying performance of the
Group going forward. These can be broken down as follows:
Acquisition GBP1.20m Represents the estimated total
costs professional costs incurred in
acquiring VIC.
Intangible GBP0.24m Represents the amortisation charge
amortisation on intangible assets purchased
on acquisition. The increase on
HY 2013 is due to the intangible
assets purchased with the VIC
acquisition.
NI on exercise GBP0.23m In 2009 when the share price had
of hit its historic low of 7.5p a
2009 Director new Board was formed to transform
options the business and as an incentive
up to 6 million share options
at 8.5p were approved by the shareholders.
During HY 2014 some of the Directors
exercised these options and the
company incurred high National
Insurance (NI) costs on the exercises.
There are four million shares
still outstanding.
IFRS 2 charge GBP0.02m Represents the IFRS 2 fair value
charge.
---------
TOTAL GBP1.69m
---------
Pre-tax profit before separately disclosed items improved
by 45.6% to GBP6.63 million (HY 2013: GBP4.55m). On
a constant currency basis, this would have increased
by a further GBP0.36 million with the biggest impact
benefitting Asia. The Group's underlying EBITDA increased
to GBP7.66 million (HY 2013: GBP5.43m) and represents
10.3% of Group revenue (HY 2013: 8.3%).
The taxation charge of GBP1.45 million (HY 2013: GBP1.02m)
is recognised based on the estimated weighted average
annual Group's effective corporate tax rates. The impact
of VIC, which has an Effective Tax Rate ('ETR') of 35%
has resulted in the estimated tax rate used for HY 2014
increasing to 29% (HY 2013: 26%).
The growth in organic earnings and the positive contribution
from VIC has increased our ROCE by +210 bps to 17.3%
(HY 2013: 15.2%) on a twelve month rolling basis.
Adjusted diluted earnings per share increased 39.5%
to 4.10 pence (HY 2013: 2.94p) and basic earnings per
share increased by 1.3% to 3.10 pence (HY 2013: 3.06p).
Balance sheet, cash flow "tight controls and effective
and working capital cash collection "
As at 30 September 2014, the total Shareholder equity
amounted to GBP66.65 million, an increase of GBP4.98
million on 31 March 2014, predominantly from the retained
earnings in the period of GBP1.92million and GBP2.56
million from the issue of shares being a mixture of
options exercised and shares issued with respect to
the acquisition of VIC.
Property, plant and equipment in the period increased
by GBP3.83 million on 31 March 2014 and intangibles
increased by GBP14.92 million as a result of VIC. The
intangible assets purchased on the acquisition were
made up of goodwill of GBP6.93 million, customer related
and technology based intangibles of GBP8.05 million,
which will be amortised over a weighted average 13.11
years and other intangibles of GBP0.05 million. Deferred
tax liabilities have increased due to the liabilities
of VIC acquired of GBP0.94 million, this will be reviewed
in more depth at the year-end. The provisional fair
value of the net assets acquired with VIC was GBP19.15
million.
Inventory, receivables and payables have all increased
since 31 March 2014, in part to the acquisition, but
also due to the increase in the level of business in
the period. Net inventory weeks in the first half increased
to 20.6 compared to 20.1 in HY 2013 and 19.1 weeks in
FY 2014. Since the start of the current year, higher
inventory levels were required to support the increase
in demand largely from automotive customers and also
to increase our branded product availability which carry
longer inventory holding periods. We would expect these
levels to reduce in the second half as new business
starts to flow through the system.
Net debtor days have increased from 65 days in FY 2014
to 71 days (HY 2013: 69 days) reflecting the general
increase in business and VIC's receivables, which historically
have a longer lead cycle. Although VIC has the ability
to factor their receivables 'without recourse', we are
consciously not currently using this facility to full
effect. Elsewhere, cash collection remains effective
with minimal bad debts during the period under review.
The increase in payables also includes potential deferred
consideration of GBP4.07 million, which may become due
to VIC's vendors.
Capex in the period was GBP0.46 million (HY 2013: GBP0.31m)
with depreciation running at GBP0.58 million (HY 2013:
GBP0.57m).
Cash flow clearly has been adversely affected by the
increase in inventory and receivable days as well as
the payment of acquisition and NI costs as set out above.
For the period under review, cash used in operations
was GBP0.36 million compared to cash generated of GBP3.36
million in HY 2013. We envisage that this position will
improve in the second half of this year.
Finance and banking facilities
In May 2014, the Group agreed additional banking facilities
with HSBC, comprising a term loan facility of up to
EUR25.00 million, which was fully utilised to fund the
acquisition of VIC, and a revolving multi-currency credit
facility ('RCF') of up to GBP10.00 million, which currently
is not being utilised, to replace the Group's previous
RCF of EUR5.00 million. The Group also has an GBP18.30
million Asset Based Lending facility, which is used
in the UK.
As at 30 September 2014, gross debt was GBP31.08 million
(FY 2014: GBP13.47m) and net debt was GBP17.53 million,
compared to a net cash position of GBP2.03 million at
31 March 2014, giving a net gearing ratio of 26.3% (HY
2013: 6.0%).
Outlook "World of opportunity - strong
momentum"
With further recent enhancements to our globally linked
customer enquiry portal, the Group is now in a position
to measure more accurately its forward order pipeline
and at the time of writing, the business teams are reporting
it to be at an historic all-time high by value.
By recruiting several additional sales engineers for
the automotive and telecoms sectors during the first
half year, we now have the necessary resources to continue
the pace of organic growth. These investments have also
been matched with new manufacturing plant for Italy
and Asia, thus allowing more production to be placed
in-house.
Meanwhile, margin improvement continues to be driven
by on-going operational process efficiencies, particularly
in warehouse storage, order picking and packaging. The
'self-help' programme initiated back in 2011 keeps on
giving with regard to productivity and cost efficiencies,
and clearly forms a solid foundation to the now well
established 'continuous improvement'
philosophy and culture.
The order book position and current levels of organic
growth are such that the Board remains optimistic about
the Group's outlook and expects trading to exceed its
expectations for the financial year as a whole. At the
same time the Board continues to identify, approach
and assess the next strategic acquisition opportunity
through adopting the well proven investment criteria
that have recently served Trifast well in Malaysia and
Italy.
Dividend "dividend underpins confidence in
the future"
We are committed to a progressive dividend policy whilst
balancing our investment in the business for the future
benefit of all stakeholders, customers and colleagues
alike. Given our confidence in our future, the Board
is declaring an interim dividend of 0.60 pence per share,
an increase of 50%, to be paid on 17 April 2015, to
shareholders on the Register as at 20 March 2015. The
shares will become ex-dividend on 19 March 2015.
Risks and uncertainties
The Directors do not consider that the principal risks
and uncertainties of the Group have changed since the
publication in July 2014 of the Group's Annual Report
for the year ended 31 March 2014. A copy of this can
be found on our website www.trifast.com.
No system can fully eliminate risk and therefore the
understanding of operational risk is central to the
management process within TR. The Group operates a system
of internal control and risk management in order to
provide assurance that we are managing risk whilst achieving
our business objectives. Risk assessment reviews are
regularly carried out by Management, with responsibilities
for monitoring and mitigating personally allocated to
a broad spread of individual managers. The review is
analysed and discussed at Audit Committee meetings chaired
by our Senior Independent Non-Executive Director.
As with all businesses, the Group faces risks, with
some not wholly within its control, which could have
a material impact on the Group, and may affect its performance
with actual results becoming materially different from
both forecast and historic results. Although there are
indications that the macro-economic climate is slowly
improving, it is too soon in Management's opinion to
assume the worst is reliably over, and so we continue
to remain vigilant for any indications of a reversal
that could adversely impact expected results going forward.
Past and future acquisitions can also carry impairment
risks on goodwill should there be a sustained downturn
in trading within an acquired subsidiary.
The long-term success of the Group depends on the on-going
review, assessment and control of the key business risks
it faces.
Trifast plc - Responsibility statement
We confirm that to the best of our knowledge:
-- the condensed set of financial statements has been
prepared in accordance with IAS 34 Interim Financial
Reporting as adopted by the EU;
-- the interim management report includes a fair review
of the information required by:
(a) DTR 4.2.7R of the Disclosure and Transparency Rules,
being an indication of important events that have occurred
during the first six months of the financial year and
their impact on the condensed set of financial statements;
and a description of the principal risks and uncertainties
for the remaining six months of the year; and
(b) DTR 4.2.8R of the Disclosure and Transparency Rules,
being related party transactions that have taken place
in the first six months of the current financial year
and that have materially affected the financial position
or performance of the entity during that period; and
any changes in the related party transactions described
in the last annual report that could do so.
By order of the Board
Malcolm Diamond MBE, Executive Chairman
Jim Barker, Chief Executive Officer
Mark Belton, Group Finance Director
11 November 2014
Trifast plc
Condensed consolidated financial statements for the six months ended 30 September 2014
Condensed consolidated interim income statement
Unaudited results for the six months ended 30 September 2014
Notes Six months Six months Year
ended ended ended
30 September 30 September 31 March
2014 2013 2014
GBP000 GBP000 GBP000
Continuing operations
Revenue 74,033 65,264 129,775
Cost of sales (52,575) (47,203) (93,809)
------- -------------- ------------- ---------
Gross profit 21,458 18,061 35,966
Operating income 165 142 312
Distribution expenses (1,490) (1,542) (2,927)
-------------------------------------------- ------- -------------- ------------- ---------
Administrative expenses before
separately disclosed items: 2 (13,059) (11,801) (23,655)
Acquisition costs (1,200) - -
Intangible amortisation (238) (166) (221)
NI on exercise of 2009 Director
options (228) - -
IFRS 2 charge (22) (46) (67)
-------------------------------------------- ------- -------------- ------------- ---------
Total administrative expenses (14,747) (12,013) (23,943)
Operating profit 5,386 4,648 9,408
------- -------------- ------------- ---------
Financial income 56 19 85
Financial expenses (503) (328) (619)
------- -------------- ------------- ---------
Net financing costs (447) (309) (534)
Profit before tax 4,939 4,339 8,874
Taxation 5 (1,453) (1,017) (2,276)
------- -------------- ------------- ---------
Profit for the period
(attributable to equity shareholders
of the parent company) 3,486 3,322 6,598
------- -------------- ------------- ---------
Earnings per share (total)
- Basic 7 3.10p 3.06p 6.08p
- Diluted 7 2.97p 2.90p 5.76p
Condensed consolidated interim statement of comprehensive income
Unaudited results for the six months ended 30 September 2014
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2014 2013 2014
GBP000 GBP000 GBP000
Profit for the period 3,486 3,322 6,598
Other comprehensive income /
(expense):
Foreign currency translation
differences (349) (3,495) (5,083)
Net gain on hedge of net investment
in foreign subsidiary 857 - -
------------- ------------- ----------
Other comprehensive income /
(expense) recognised directly
in equity, net of income tax 508 (3,495) (5,083)
------------- ------------- ----------
Total comprehensive income /
(expense) recognised for the
period
(attributable to equity shareholders
of the parent company) 3,994 (173) 1,515
------------- ------------- ----------
Trifast plc
Condensed consolidated financial statements for the six months ended 30 September 2014
Condensed consolidated interim statement of changes in equity
Unaudited results for
the Share Share Translation Retained Total
six months ended 30 Capital Premium Reserve Earnings Equity
September 2014 GBP000 GBP000 GBP000 GBP000 GBP000
Balance at 1 April 2014 5,435 18,488 6,888 30,856 61,667
Total comprehensive
income for the period
Profit for the period - - - 3,486 3,486
Other comprehensive
income
Foreign currency translation
differences - - (349) - (349)
Net gain on hedge of
net investment in foreign
subsidiary - - 857 - 857
Total other comprehensive
income - - 508 - 508
-------- -------- ----------- --------- -------
Total comprehensive
income for the period - - 508 3,486 3,994
-------- -------- ----------- --------- -------
Transactions with owners,
recorded directly in
equity
Issue of share capital 240 2,316 - - 2,556
Dividends - - - (1,568) (1,568)
-------- -------- ----------- --------- -------
Total transactions with
owners 240 2,316 - (1,568) 988
-------- -------- ----------- --------- -------
Balance at 30 September
2014 5,675 20,804 7,396 32,774 66,649
-------- -------- ----------- --------- -------
Unaudited results for
the Share Share Translation Retained Total
six months ended 30 Capital Premium Reserve Earnings Equity
September 2013 GBP000 GBP000 GBP000 GBP000 GBP000
Balance at 1 April 2013 5,412 18,427 11,971 24,612 60,422
Total comprehensive
income for the period
Profit for the period - - - 3,322 3,322
Other comprehensive
expense
Foreign currency translation
differences - - (3,495) - (3,495)
Total other comprehensive
expense - - (3,495) - (3,495)
-------- -------- ----------- --------- -------
Total comprehensive
(expense) / income for
the period - - (3,495) 3,322 (173)
-------- -------- ----------- --------- -------
Transactions with owners,
recorded directly in
equity
Issue of share capital 11 11 - - 22
Share based payment
transactions - - - 46 46
Dividends - - - (868) (868)
Total transactions with
owners 11 11 - (822) (800)
-------- -------- ----------- --------- -------
Balance at 30 September
2013 5,423 18,438 8,476 27,112 59,449
-------- -------- ----------- --------- -------
Trifast plc
Condensed consolidated financial statements for the six months ended 30 September 2014
Condensed consolidated interim statement of financial position
Unaudited results for the six months ended 30 September 2014
30 September 30 September 31 March
2014 2013 2014
Group Notes GBP000 GBP000 GBP000
Non-current assets
Property, plant and equipment 15,655 12,170 11,828
Intangible assets 31,883 17,347 16,959
Deferred tax assets 1,257 966 1,257
------------
Total non-current assets 48,795 30,483 30,044
------------ ------------ --------
Current assets
Inventories 39,285 30,940 30,574
Trade and other receivables 35,532 29,073 27,665
Cash and cash equivalents 8 13,596 13,680 15,535
------------
Total current assets 88,413 73,693 73,774
------------ ------------ --------
Total assets 137,208 104,176 103,818
------------ ------------ --------
Current liabilities
Bank overdraft 8 47 171 31
Other interest-bearing loans
and borrowings 8 11,691 13,711 10,950
Trade and other payables 33,277 22,912 24,678
Tax payable 2,256 2,012 2,120
Dividends payable 6 1,134 868 -
Provisions - 410 124
------------ ------------
Total current liabilities 48,405 40,084 37,903
------------ ------------ --------
Non-current liabilities
Other interest-bearing loans
and borrowings 8 19,389 3,350 2,524
Provisions 1,100 793 938
Deferred tax liabilities 1,665 500 786
------------ ------------ --------
Total non-current liabilities 22,154 4,643 4,248
------------ ------------ --------
Total liabilities 70,559 44,727 42,151
------------ ------------ --------
Net assets 66,649 59,449 61,667
------------ ------------ --------
Equity
Share capital 5,675 5,423 5,435
Share premium 20,804 18,438 18,488
Reserves 7,396 8,476 6,888
Retained earnings 32,774 27,112 30,856
------------ ------------ --------
Total equity 66,649 59,449 61,667
------------ ------------ --------
Trifast plc
Condensed consolidated financial statements for the six months ended 30 September 2014
Condensed consolidated interim statement of cash flows
Unaudited results for the six months ended 30 September 2014
Notes Six months Six months Year
ended ended ended
30 September 30 September 31 March
2014 2013 2014
GBP000 GBP000 GBP000
Group
Cash flows from operating
activities
Profit for the period 3,486 3,322 6,598
Adjustments for:
Depreciation, amortisation
& impairment 820 735 1,323
Financial income (56) (19) (85)
Financial expense 503 328 619
(Gain) / loss on sale of property,
plant & equipment and investments (14) 11 26
Equity settled share-based
payment charge 22 46 67
Taxation charge 1,453 1,017 2,276
Operating cash inflow before
changes in
working capital and provisions 6,214 5,440 10,824
Change in trade and other
receivables (3,700) (2,770) (1,336)
Change in inventories (3,059) (1,622) (1,605)
Change in trade and other
payables 148 2,505 4,281
Change in provisions 37 (198) (339)
------------- ------------- ---------
Net cash generated (used in)
/ from operations (360) 3,355 11,825
Tax paid (2,546) (724) (1,809)
------------- ------------- ---------
Net cash (used in) / from
operating activities (2,906) 2,631 10,016
Cash flows from investing
activities
Proceeds from sale of property,
plant & equipment 16 3 12
Interest received 56 9 85
Acquisition of subsidiary,
net of cash acquired (18,610) - -
Acquisition of property, plant
& equipment (456) (309) (838)
Net cash used in investing
activities (18,994) (297) (741)
------------- ------------- ---------
Cash flows from financing
activities
Proceeds from the issue of
share capital 2,556 22 84
Proceeds from new loan 20,337 2,543 -
Repayment of borrowings (1,955) (779) (1,679)
Purchase / (payment) of finance
lease liabilities 38 (50) (51)
Dividends paid (434) - (867)
Interest paid (503) (328) (619)
Net cash from / (used in)
financing activities 20,039 1,408 (3,132)
------------- ------------- ---------
Net change in cash and cash
equivalents (1,861) 3,742 6,143
Cash and cash equivalents
at start of period 1 April 15,504 10,555 10,555
Effect of exchange rate fluctuations
on cash held (94) (788) (1,194)
------------- ------------- ---------
Cash and cash equivalents
at end of period 8 13,549 13,509 15,504
------------- ------------- ---------
Trifast plc
Condensed consolidated financial statements for the six months ended 30 September 2014
Notes to the condensed consolidated interim financial statements
Unaudited results for the six months ended 30 September 2014
1. Basis of preparation
These condensed consolidated interim financial statements have been prepared on the basis of accounting policies set out in the full Annual Report and Accounts for the year ended 31 March 2014 except as detailed below:
There are no new standards effective for the first time in the current financial period with significant impact on the Group's consolidated results or financial position.
These condensed consolidated interim financial statements have been prepared in accordance with the Disclosure and Transparency Rules (DTR) of the Financial Conduct Authority and International Financial Reporting Standard (IFRS) IAS 34: Interim Financial Reporting as adopted by the EU. 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 as at and for the year ended 31 March 2014. The annual financial statements of the Group are prepared in accordance with International Reporting Standards (IFRSs) as adopted by the EU.
This statement does not comprise full financial statements within the meaning of Section 495 and 496 of the Companies Act 2006. The statement is unaudited but has been reviewed by KPMG LLP and their Report is set out at the end of this document.
The comparative figures for the financial year ended 31 March 2014 are not the Company's statutory accounts for that financial year and have been extracted from the full Annual Report and Accounts for that financial year. Those accounts have been reported on by the Company's auditor and delivered to the Registrar of Companies. The Report of the Auditors was (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their Report, and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.
Going concern
The Company's business activities, together with the factors likely to affect its future development, performance and position are set out in the accompanying half-yearly statement by the Executive Chairman and Chief Executive. The financial position of the Company, its cash flows, liquidity position and borrowing facilities also are described in the same statement. In addition, note 26 to the Company's previously published financial statements for the year ended 31 March 2014 include the Company's objectives, policies and processes for managing its capital; its financial risk management objectives; details of its financial instruments and hedging activities; and its exposures to credit risk and liquidity risk.
These condensed consolidated interim financial statements have been prepared on a going concern basis which the Director's consider to be appropriate.
Estimates
The preparation of financial statements in conformity with IFRSs requires management to make estimates, judgements and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions take account of the circumstances and facts at the period end, historical experience of similar situations and other factors that are believed to be reasonable and relevant, the results for which form the basis of making the judgements about carrying values of assets and liabilities that are not readily available from other sources. Actual results may ultimately differ from these estimates.
In preparing these condensed consolidated interim financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were in the same areas as those that applied to the consolidated financial statements as at and for the year ended 31 March 2014. These were as follows:-
Ø Recoverable amount of goodwill
Ø Provisions
Ø Inventory valuation
2. Pre-tax profit before separately disclosed items
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2014 2013 2014
GBP000 GBP000 GBP000
Pre-tax profit before separately
disclosed items 6,627 4,551 9,162
Separately disclosed items within
administration expenses:
Acquisition costs (1,200) - -
Intangible amortisation (238) (166) (221)
NI on exercise of 2009 Director (228) - -
options
IFRS 2 share-based payment charge (22) (46) (67)
Profit from continuing operations
before tax 4,939 4,339 8,874
------------------ ----------------- ---------------
3. Geographical operating segments:
The Group is comprised of the following main geographical
operating segments:
Ø UK
Ø Mainland Europe includes Norway, Sweden, Hungary, Ireland,
Italy, Holland and Poland
Ø USA includes USA and Mexico
Ø Asia includes Malaysia, China, Singapore,
Taiwan, Thailand and India
In presenting information on the basis of geographical
operating segments, segment revenue and segment assets
are based on the geographical location of our entities
across the world, and are consolidated into the four distinct
geographical regions, which the Board use to monitor and
assess the Group.
Segment revenue and results under the primary reporting
format for the six months ended 30 September 2014 and
2013 are disclosed in the table below:
September 2014 UK Mainland Central Total
Europe USA Asia costs,
assets
and liabilities
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Revenue*
Revenue from external
customers 31,989 21,171 1,903 18,970 - 74,033
Inter segment revenue 929 184 25 2,868 - 4,006
--------- --------- ------- --------- ----------------- ---------
Total revenue 32,918 21,355 1,928 21,838 - 78,039
========= ========= ======= ========= ================= =========
Underlying operating
result 2,920 2,877 193 2,661 (1,577) 7,074
Net financing costs (147) (46) (1) (38) (215) (447)
--------- --------- ------- --------- ----------------- ---------
Underlying segment result 2,773 2,831 192 2,623 (1,792) 6,627
Separately disclosed
items (see note 2) (1,688)
---------
Profit before tax 4,939
=========
Specific disclosure items
Depreciation and amortisation 79 74 7 426 234 820
Assets and liabilities
Segment assets 38,016 29,768 1,728 47,148 20,548 137,208
Segment liabilities (22,616) (9,159) (300) (11,081) (27,403) (70,559)
========= ========= ======= ========= ================= =========
September 2013 UK Mainland Central Total
Europe USA Asia costs,
assets
and
liabilities
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Revenue*
Revenue from external
customers 31,345 12,274 1,482 20,163 - 65,264
Inter segment revenue 796 230 56 2,555 - 3,637
--------- --------- ------- --------- -------------- ---------
Total revenue 32,141 12,504 1,538 22,718 - 68,901
========= ========= ======= ========= ============== =========
Underlying operating
result 2,585 799 176 2,584 (1,284) 4,860
Net financing costs (185) (14) - (83) (27) (309)
--------- --------- ------- --------- -------------- ---------
Underlying segment result 2,400 785 176 2,501 (1,311) 4,551
Separately disclosed
items (see note 2) (212)
---------
Profit before tax 4,339
=========
Specific disclosure items
Depreciation and amortisation 71 25 7 473 159 735
Assets and liabilities
Segment assets 37,383 10,760 1,514 48,648 5,871 104,176
Segment liabilities (26,500) (2,737) (111) (12,134) (3,245) (44,727)
*Revenue is derived from the manufacture and logistical supply of industrial fasteners and category 'C' components.
4. Acquisition of Viterie Italia Centrale Srl ('VIC')
On 30 May 2014, the Group acquired the entire issued
capital stock of VIC for an initial consideration of
EUR27.00 million (GBP22.02m), satisfied by way of EUR24.15
million (GBP19.65m) in cash and EUR2.85m (GBP2.37m)
by the issue and allotment of 3,000,000 shares of 5
pence each in the Company to Carlo Perini, the Managing
Director and 30% owner of VIC.
In addition, a further payment of maximum EUR5.00 million
(GBP4.07m) may be due to the Vendors depending upon
the performance of VIC over the 12 month period ending
31 December 2014. If VIC generates an adjusted post-tax
profit (as defined in the Acquisition Agreement) for
the year ending 31 December 2014 which exceeds EUR3.00
million then for each EUR1 above this sum an additional
EUR5 is payable to the Vendors, subject to a maximum
amount of EUR5.00 million.
VIC is a manufacturer and distributor of fastenings
systems and is complementary to the Group's business
model; it significantly strengthens the Group's presence
in the domestic appliance market whilst also offering
TR additional opportunities in existing electronic and
automotive Tier 1 markets. The business will also provide
an additional competitive manufacturing facility in
Europe to complement the Group's existing resources
in Asia.
In the four months since acquiring VIC to 30 September
2014, the subsidiary contributed GBP1.63 million to
the consolidated net profit for the period and GBP7.51
million to the Group's revenue. If the acquisition had
occurred on 1 April 2014, Group revenue would have increased
by an estimated GBP11.08 million and net profit would
have been increased by an estimated GBP2.36 million.
In determining these amounts management has assumed
that the fair value adjustments that arose on the date
of acquisition would have been the same as if the acquisition
had occurred on 1 April 2014.
Effect of Acquisition Recognised values
on acquisition
GBP000
Property, plant and equipment 3,950
Intangible assets 8,108
Inventory 5,967
Trade and other receivables 4,589
Cash and cash equivalents 3,405
Trade and other payables (4,703)
Corporation tax payable (1,225)
Deferred tax liabilities (941)
------------------------------------------ -------------------
Net identifiable assets and liabilities 19,150
------------------------------------------ -------------------
Consideration paid:
Initial cash price paid 22,015
Deferred consideration at fair value 4,067
------------------------------------------ -------------------
Total consideration 26,082
------------------------------------------ -------------------
Goodwill on acquisition 6,932
------------------------------------------ -------------------
Intangible assets that arose on the acquisition include
the following:-
Ø GBP5.45 million of customer relationships, with
an amortisation period deemed to be 15 years
Ø GBP2.33 million of technology knowhow, with an
amortisation period deemed to be 10 years
Ø GBP0.27 million of technological patents, with
an amortisation period deemed to be 15 years
Ø GBP0.05 million of other intangibles, with an
amortisation period deemed to be between 3-5 years
Goodwill is the excess of the purchase price over the
fair value of the net assets acquired and is not deductible
for tax purposes. It mostly represents potential synergies,
e.g. cross-selling opportunities between VIC and Trifast
Group and VIC's assembled workforce.
Fair values determined on a provisional GBP000
basis
----------------------------------------------------- -----------
Corporation tax payable (1,225)
Deferred tax liabilities (941)
The above have been determined on a provisional basis
because an in-depth tax analysis has not yet been undertaken
on the fair value adjustments - this will be completed
by the financial year end.
4. Acquisition of Viterie Italia Centrale Srl (continued)
Effect of Acquisition
The Group estimates that it will incur costs of GBP1.20
million in relation to the acquisition of VIC. These
costs have been included in administrative expenses
in the Group's consolidated statement of comprehensive
income.
5. Taxation
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2014 2013 2014
GBP000 GBP000 GBP000
Current tax on income for the
period
UK tax (69) 294 510
Foreign tax 1,562 842 1,603
Deferred tax expense (50) - 49
Adjustments in respect of prior
years 10 (119) 114
--------------- --------------- --------------
1,453 1,017 2,276
--------------- --------------- --------------
6. Dividend
The dividend payable of GBP1.13 million represents the
final dividend recommended for the year ended 31 March
2014, approved by shareholders at the AGM on 18 September
2014 and paid to shareholders on the Register on 17 October
2014.
7. Earnings per share
The calculation of earnings per 5 pence ordinary share
is based on profit for the period after taxation and the
weighted average number of shares in the period of 113,495,406
(HY2013: 108,439,566; FY2014: 108,533,645).
The calculation of the fully diluted earnings per 5 pence
ordinary share is based on profit for the period after
taxation. In accordance with IAS 33 the weighted average
number of shares in the period has been adjusted to take
account of the effects of all dilutive potential ordinary
shares. The number of shares used in the calculation amount
to 117,436,525 (HY2013: 114,411,329; FY2014: 114,485,387).
The adjusted diluted earnings per share, which in the
Directors' opinion best reflects the underlying performance
of the Group is detailed below:
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2014 2013 2014
GBP000 GBP000 GBP000
Profit for the period 3,486 3,322 6,598
Acquisition costs 1,200 - -
Intangible amortisation 238 166 221
NI on exercise of 2009 Director 228 - -
options
IFRS 2 Share option 22 46 67
Tax adjustment (354) (170) (66)
--------------- --------------- --------------
Adjusted profit 4,820 3,364 6,820
--------------- --------------- --------------
Basic EPS 3.10p 3.06p 6.08p
Diluted basic EPS 2.97p 2.90p 5.76p
Adjusted diluted EPS 4.10p 2.94p 5.95p
8. Analysis of net (debt)/ cash
At At At
30 September 30 September 31 March
2014 2013 2014
GBP000 GBP000 GBP000
Cash and cash equivalents 13,596 13,680 15,535
Bank overdraft (47) (171) (31)
-------------- -------------- ----------
Net cash and cash equivalents 13,549 13,509 15,504
-------------- -------------- ----------
Debt due within one year (11,691) (13,711) (10,950)
Debt due after one year (19,389) (3,350) (2,524)
-------------- -------------- ----------
(31,080) (17,061) (13,474)
-------------- -------------- ----------
Total (17,531) (3,552) 2,030
============== ============== ==========
Reconciliation of net cash flow to movement in net debt
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2014 2013 2014
GBP000 GBP000 GBP000
Net (decrease) / increase in
cash and cash equivalents (1,861) 3,742 6,143
Net (increase) / decrease in
borrowings (18,420) (1,714) 1,679
-------------- -------------- -------------
(20,281) 2,028 7,822
Exchange rate differences 720 (383) (595)
-------------- -------------- -------------
Movement in net debt (19,561) 1,645 7,227
Opening net cash / (debt) 2,030 (5,197) (5,197)
-------------- -------------- -------------
Closing net (debt) / cash (17,531) (3,552) 2,030
============== ============== =============
Independent review report by KPMG LLP to Trifast plc
Introduction
We have been engaged by the Company to review the condensed
set of financial statements in the half-yearly financial
report for the six months ended 30 September 2014 which
comprises the consolidated income statement, the consolidated
statement of comprehensive Income, the consolidated
statement of changes in equity, the consolidated statement
of financial position, the consolidated statement of
cash flows and the related explanatory notes. We have
read the other information contained in the half-yearly
financial report and considered whether it contains
any apparent misstatements or material inconsistencies
with the information in the condensed set of financial
statements.
This Report is made solely to the Company in accordance
with the terms of our engagement to assist the Company
in meeting the requirements of the Disclosure and Transparency
Rules ("the DTR") of the UK's Financial Conduct Authority
("the UK FCA"). Our review has been undertaken so that
we might state to the Company those matters we are required
to state to it in this Report and for no other purpose.
To the fullest extent permitted by law, we do not accept
or assume responsibility to anyone other than the Company
for our review work, for this Report, or for the conclusions
we have reached.
Directors' responsibilities
The half-yearly financial report is the responsibility
of, and has been approved by, the Directors. The Directors
are responsible for preparing the half-yearly financial
report in accordance with the DTR of the UK FCA.
As disclosed in note 1, the annual financial statements
of the Group are prepared in accordance with IFRSs as
adopted by the EU. The condensed set of financial statements
included in this Half-yearly financial report has been
prepared in accordance with IAS 34 Interim Financial
Reporting as adopted by the EU.
Our responsibility
Our responsibility is to express to the Company a conclusion
on the condensed set of financial statements in the
half-yearly financial report based on our review.
Scope of review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410
Review of Interim Financial Information Performed by
the Independent Auditor of the Entity issued by the
Auditing Practices Board for use in the UK. A review
of interim financial information consists of making
enquiries, primarily of persons responsible for financial
and accounting matters, and applying analytical and
other review procedures. A review is substantially less
in scope than an audit conducted in accordance with
International Standards on Auditing (UK and Ireland)
and consequently does not enable us to obtain assurance
that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we
do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention
that causes us to believe that the condensed set of
financial statements in the half-yearly financial report
for the six months ended 30 September 2014 is not prepared,
in all material respects, in accordance with IAS 34
as adopted by the EU and the DTR of the UK FCA.
Martin Newsholme
for and on behalf of KPMG LLP
Chartered Accountants, 1 Forest Gate, Brighton Road,
Crawley, West Sussex, RH11 9PT
11 November 2014
Editor's Note
Trifast's trading business TR Fastenings is a leading
international manufacturer and distributor of industrial
fastenings to the assembly industries, with operations
in Europe, the Americas and Asia.
For more information:
LSE Listing: Ticker: TRI FTSE index sector: FTSE Small
Cap and FTSE All-share indices
Group website: www.trifast.com
Follow us on: Twitter: www.twitter.com/trfastenings
; www.facebook.com/trfastenings : www.linkedin.com/company/tr-fastenings
Enquiries or for further
details please contact: TooleyStreet Communications Peel Hunt LLP
Trifast plc IR & media relations Stockbroker & financial
Malcolm Diamond MBE, Fiona Tooley adviser
Executive Chairman Tel: +44 (0)7785 Justin Jones
Today: + 44 (0) 20 703523 Mike Bell
7418 8900 (Peel Hunt) Email: fiona@tooleystreet.com Tel: +44 (0)20
Mobile: +44 (0) 7979 7418 8900
518493 (MMD)
Jim Barker, Chief Executive
Mark Belton, Group
Finance Director
Office: +44 (0) 1825
747630
Email: corporate.enquiries@trifast.com
---------------------------------------- -------------------------------- --------------------------
Electronic Communications
The Company is not proposing to bulk print and distribute
hard copies of this half-yearly financial report for
the six months ended 30 September 2014 unless specifically
requested by individual shareholders. News updates,
Regulatory News, and Financial statements, can be viewed
and downloaded from the Group's website, www.trifast.com.
Copies can also be requested via corporate.enquiries@trifast.com
or, in writing to, The Company Secretary, Trifast plc,
Trifast House, Bellbrook Park, Uckfield, East Sussex,
TN22 1QW
This information is provided by RNS
The company news service from the London Stock Exchange
END
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