RNS Number:1405E
Mercury Recycling Group PLC
20 September 2007
MERCURY RECYCLING GROUP PLC
INTERIM REPORT FOR THE PERIOD ENDING 30 JUNE 2007
CHAIRMAN'S STATEMENT
I am pleased to report that the Group's unaudited results for the six months
ended 30 June 2007, show a further increase in sales compared to the same period
last year to #1,304,000 from #1,219,000. Operating profits at the interim
stage, excluding goodwill impairment and exceptional items increased to #233,000
from #212,000. The operating profit for the whole of the last financial year
was #336,000. As can be seen from the Balance Sheet, we have a strong liquid
position, with current assets at #901,000 including cash of #323,000.
The WEEE Directive was eventually implemented on 1 July, so that all Gas
Discharge lamps must now be legally recycled. I said in my statement at the
year end, that there was confusion in Government Departments and the industry
generally. Without that confusion, I am sure that sales and profits would have
been much better. The position has now become clearer, although the complex
implementation of the Directive will take a little longer to settle down. We
have however, had successful discussions with all the compliance schemes within
our sector, where we now have excellent relationships.
It will of course take some time for all the estimated 130 million lamps to be
recycled, given that only something below 25% are currently being recycled,
there is obviously room for large increases, and I am confident we will at the
very least maintain our present major share of the lamp recycling market. I
should repeat again that no capital expenditure will be required, as our new
plant and premises have the capacity to substantially increase our recycling
output. I can report that new customers continue to come on board every month.
In addition following the implementation of the WEEE directive, we are starting
to receive from our large customer base, WEEE products other than lamps for
recycling.
In order to ensure that the relevant authorities are in place to enable the
Board to issue shares, a notice convening an EGM has been prepared and is also
enclosed with these results.
I conclude by emphasising that the Board are confident following all I have said
above, that future prospects look very good.
The Rt Hon The Lord Barnett JP PC
Chairman
20 September 2007
Enquiries:
Simon Lebor, Group Chief Executive Tel: 0161 877 0977
John Wakefield, Blue Oar Securities Plc Tel: 0117 933 0020
CONSOLIDATED INCOME STATEMENT
FOR THE PERIOD ENDED 30 JUNE 2007
As restated
6 Months 6 Months
Year
ended ended
ended
30.6.07 30.6.06
31.12.06
#'000 #'000
#'000
Revenue 1,304 1,219
2,399
Cost of sales (204) (104)
(193)
Gross profit 1,100 1,115
2,206
Administrative expenses (979) (1,034)
(2,096)
Operating profit before goodwill impairment,
relocation costs and share based payment costs 233 212
336
Relocation costs - (17)
-
Share-based payment expense (10) (12)
(22)
Goodwill impairment (102) (102)
(204)
Operating profit 121 81
110
Investment revenues 2 1
1
Finance costs (13) (14)
(27)
Profit before taxation 110 68
84
Tax - -
-
Profit for the period 110 68
84
Earnings per share: Basic (pence) 0.33p 0.20p
0.25p
Diluted (pence) 0.32p 0.19p
0.24p
STATEMENT OF CHANGES IN EQUITY
As restated
6 Months 6 Months
Year
ended ended
ended
30.6.07 30.6.06
31.12.06
#'000 #'000
#'000
Opening balance (and as restated for
conversion to IFRS) 4,175 4,032
4,032
Profit for the financial period 110 68
84
New shares issued - -
37
Share based payments 10 12
22
Closing balance 4,295 4,112
4,175
CONSOLIDATED BALANCE SHEET
AS AT 30 JUNE 2007
As restated
As at As at
As at
30.6.07 30.6.06
31.12.06
#'000 #'000
#'000
Non-current assets
Goodwill 2,919 3,124
3,021
Other intangible assets 2 3
2
Property, plant and equipment 1,109 1,139
1,140
4,030 4,266
4,163
Current assets
Trade and other receivables 578 493
533
Cash and cash equivalents 323 29
135
901 522
668
Total assets 4,931 4,788
4,831
Current liabilities
Trade and other payables (163) (172)
(172)
Current tax liabilities (108) (86)
(93)
Obligations under finance leases (17) (42)
(21)
Bank overdrafts and loans (25) (7)
(26)
(313) (307)
(312)
Non-current liabilities
Other payables (70) (79)
(73)
Bank loans (248) (290)
(259)
Obligations under finance leases (5) -
(12)
(323) (369)
(344)
Total liabilities (636) (676)
(656)
Net assets 4,295 4,112
4,175
Capital and reserves
Share capital 3,373 3,336
3,373
Share premium 242 242
242
Other reserve 283 448
365
Retained earnings reserve 397 86
195
Equity shareholders' funds 4,295 4,112
4,175
CONSOLIDATED CASH FLOW STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2007
As restated
6 Months 6 Months
6 Months
ended ended
ended
30.6.07 30.6.06
31.12.06
#'000 #'000
#'000
Net cash from operating activities 255 242
377
Investing activities
Interest received 2 1
1
Purchases of property, plant and equipment (47) (77)
(96)
Net cash used in investing activities (45) (76)
(95)
Financing activities
Proceeds on issue of shares - -
20
Repayment of loans (12) (4)
(15)
Repayments of finance lease obligations (10) (5)
(24)
Net cash used in financing activities (22) (9)
(19)
Net increase in cash and cash equivalents 188 157
263
Cash and cash equivalents at the beginning of
year 135 (128)
(128)
Cash and cash equivalents at end of year 323 29
135
Note to the cash flow statement
Profit for the year 121 81
110
Depreciation on plant and equipment 79 81
145
Impairment of goodwill 102 102
204
Decrease in provisions (5) (4)
(9)
Share-based payment expense 10 12
22
Gain on disposal of plant property, plant and
equipment - (4)
(1)
Operating cash flows before movements in 307 268
471
working capital
Decrease / (increase) in receivables (45) 38
15
(Decrease) / increase in payables 6 (50)
(82)
Cash generated by operations 268 256
404
Interest paid (13) (14)
(27)
Net cash from operating activities 255 242
377
NOTES TO CONSOLIDATED ACCOUNTS
FOR THE SIX MONTHS ENDED 30 JUNE 2007
1. Basis of preparation and accounting policies
Basis of preparation
As an AIM-listed company, the Group is required to adopt International Financial
Reporting Standards (IFRS) with effect from 1 January 2007. The Group's date of
transition to IFRS was 1 January 2006.
The results for the six months to 30 June 2007 represent the Group's first
interim financial statements prepared in accordance with IFRS. The Group's
first annual report under IFRS will be for the year ended 31 December 2007.
A reconciliation between comparative values under IFRS and as reported under UK
Generally Accepted Accounting Principles (UK GAAP) has been published previously
and is available on the Group's website at www.mercuryrecycling.co.uk. The
information provided also includes details of accounting policies adopted by the
Group under IFRS, and the exceptions from retrospective application of IFRS that
the Group has applied under IFRS 1 'First Time Adoption of International
Financial Reporting Standards'.
The financial information does not constitute statutory accounts as defined by
section 240 of the Companies Act 1985. Full accounts of the company for the
year ended 31 December 2006 on which the Auditors gave an unqualified report,
have been delivered to the Registrar of Companies.
2. Earnings per share
The calculation of basic and diluted earnings per share is based upon the profit
for the period and the weighted average number of shares in issue during the
period.
6 Months 6 Months
Year
to to
to
30.6.07 30.6.06
31.12.06
'000 '000
'000
Weighted average number of shares 33,726 33,359
33,543
Options - dilution 661 1,202
797
34,387 34,561
34,340
Adjusted earnings per share is calculated using earnings before impairment of
goodwill.
6 Months 6 Months
Year
to to
to
30.6.07 30.6.06
31.12.06
pence pence
pence
Basic earnings per share 0.33 0.20
0.25
Adjustment 0.33 0.40
0.67
Adjusted basic earnings per share 0.66 0.60
0.92
3. Copies of report
Copies of this interim statement will be despatched to shareholders and will be
available to the public at the Registered Office, Mercury House, 17 Commerce
Way, Trafford Park, Manchester, M17 1HW.
4. Reconciliation of balance sheet 1 January 2007 for the impact of IFRS
Items effected by change to IFRS
UK GAAP Adjustment
IFRS
#'000 #'000
#'000
Non-current assets
Other intangible assets - 2
2
Property, plant and equipment 3,021 (2)
3,019
Current liabilities
Trade and other payables (167) (5)
(172)
Non-current liabilities
Other payables - (73)
(73)
Provisions (78) 78
-
Capital and reserves
Merger reserve (111) 111
-
Retained earnings reserve 306 (111)
195
Full details of the transition to International Financial Reporting Standards
are given on the Group's website at www.mercuryrecycling.co.uk
This information is provided by RNS
The company news service from the London Stock Exchange
END
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