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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Armour Grp | LSE:AMR | London | Ordinary Share | GB0000496611 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 3.25 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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RNS Number:0656H
Armour Group PLC
06 November 2007
ARMOUR GROUP PLC
("Armour" or the "Group")
Preliminary Results for the year ended 31 August 2007
FINANCIAL HIGHLIGHTS - GROWTH ON 2006
Group Total
- Sales of #57.4 million, up 33%.
- Operating profit of #3.8 million, up 40%.
- EBITDA of #5.9 million, up 27%.
- Basic underlying earnings per ordinary share of 4.7p, up 9%.
- Basic loss per ordinary share of 1.3p.
- Cash inflow from operating activities of #5.4 million, up 77%.
- Recommended dividend of 0.65p, up 18%.
- Net debt of #2.9 million, down 44%.
Continuing Operations
- Sales of #55.2 million, up 38%.
- Operating profit of #4.1 million, up 46%.
- EBITDA of #6.1 million, up 31%.
- Basic underlying earnings per ordinary share of 5.0p, up 16%.
- Basic earnings per ordinary share of 3.1p, up 19%.
George Dexter, Chief Executive of Armour Group plc commented:
"This year's results demonstrate the strength of our core continuing businesses
and reflect a year of good progress. The strong performance has been driven by
the fundamentals that underpin the Group's businesses, being strong brands,
quality products, comprehensive product ranges and unrivalled distribution.
Armour Automotive's sales increased by 6%. Sales to our retail customer base,
which represents 61% of the division's sales, increased 2% due to record sales
through the national accounts channel in both the UK and Sweden. This
compensated for a decline in sales to smaller independent retailers in the UK
which have suffered in uncertain market conditions. Mutant, the Group's brand of
affordable high quality in-car audio systems has a distinctive identity and
appeal and has continued to win market share. Autoleads, our branded range of
specialist connectivity solutions for the in-car communication and entertainment
market has had a steady year and is responding to the increasingly complex
connectivity and fitting solutions required by the in-car aftermarket. Sales to
non-retail customers increased by 11%. This growth has come from our Veba
branded in-car multi-media systems, manufacturer incentive programmes driving
demand, and our CTI range of GSM and GPS Antennae.
Armour Home has had a very successful year with sales from continuing operations
increasing by 60%. All our core brands and channels to market showed healthy
increases, complemented by a full year's contribution from Alphason. On a
like-for-like basis, sales from continuing operations increased by 23%. Sales
into the retail channel grew by 30%. The brands driving this growth are QED
cables, Q Acoustics, Goldring and Alphason. In addition, we secured the
exclusive distribution rights to the NAD, PSB and Tivoli product ranges which
added a further #0.6 million. Sales in the home automation channel increased by
9%, driven by the introduction of new products such as our Systemline
Soundserver and the continued growth of Systemline Modular, our market leading
multi-room entertainment system. Export sales increased by 15%, the growth
principally coming from QED, Q Acoustics and Systemline Modular.
Our investment in research and development of new products is a critical element
of delivering future sales growth. Over the last year, to meet the needs of the
increased number of new product programmes, we have expanded our in-house
development teams and increased our partnership programmes with leading
technical and design companies. The largest investment in new product
development has been the creation of our Concept Design Centre ("CDC"), whose
remit is to focus on emerging technologies and future development strategies for
our core product categories. CDC is leading the development of key new products
that range from the next generation of multi-room entertainment systems to
complex in-car connectivity and engine diagnostic devices.
The Group is focused on delivering sustainable growth. To achieve this, we
continue to invest in the strong fundamentals that underline the Group. I am
confident that the Group is well positioned to meet the challenges that lie
ahead".
For further information please contact:
Armour Group plc Tel: 01892 502700
George Dexter, Chief Executive
John Harris, Finance Director
KBC Peel Hunt Ltd, Nominated Adviser and Broker Tel: 020 7418 8900
Richard Kauffer, David Anderson
Threadneedle Communications, Financial PR Tel: 020 7936 9666
Trevor Bass, Alex White
ABOUT ARMOUR
Armour Group plc is the UK's leading consumer electronics group focused on the
in-car communications and entertainment and home entertainment markets.
The Group has an impressive brand portfolio, which boasts some of the UK's
market leaders, regularly winning industry awards for quality and innovation. In
the UK consumer electronics market, the Group has direct access to over 5,000
retail outlets.
It comprises two divisions: Armour Automotive and Armour Home.
Armour Automotive
The Armour Automotive division is the market leader in Europe in the design,
manufacture and supply of products for the in-car entertainment and
communications markets.
Its proprietary brands include Autoleads (connectivity leads and smartleads such
as the telemute lead used in mobile telephone hands free kits), CTI (GSM and GPS
aerials), VEBA (a range of in-car audio-visual entertainment systems) and Mutant
(a range of quality amplifiers and speakers for the in-car entertainment
enthusiast).
Armour Automotive's customers have voted Autoleads as "Best Cable Product" and
the Mutant MT3004X amplifier as "Best 4 Channel Amplifier below #150" at the Car
Audio Retailer magazine 2007 ICE (in-car entertainment) awards.
Automotive supplies both retail and non-retail customers which include Halfords,
Motorworld, BMW, Hyundai and Vodafone and over 1,000 independent automotive
aftermarket retailers.
Armour Home
The Armour Home division designs, manufactures, and supplies products into the
hi-fi, home theatre and home entertainment market and is a market leader in the
UK.
Its proprietary brands include QED (quality cables and interconnects),
Systemline (multi-room home entertainment systems), Alphason (hi-fi and
audio-visual furniture), Goldring (turntables, styli and headphones), Myryad
(mid to high end hi-fi separates) and Q Acoustics (range of high quality, value
for money speakers).
In September 2007, Lenbrook America was appointed as the exclusive distributor
in the USA of Armour Home's award winning range of QED cables.
The Armour Home division also distributes third party brands, typically on an
exclusive basis in the UK. These brands include Grado headphones, Nevo remote
controls, Sonance speakers, NAD hi-fi separates, Tivoli radios and Audica
speakers.
Armour Home won six What Hi-Fi? Sound and Vision awards in 2007 in regard to
products within the QED, Q Acoustics, SoundStyle and Grado brands. In addition,
UK independent electrical retailers voted Alphason "Best Accessory Company" in
the Independent Marketing Awards 2007. Alphason also won "AV Furniture
Manufacturer of the Year" (What Plasma & LCD TV? awards 2007), "Best Furniture
Maker" (What Home Cinema? awards 2007) and "Product of the Year " (Get Connected
awards 2007).
The Home division's customers are both retail and non-retail and include Comet,
Argos, John Lewis Partnership, Tesco, Sevenoaks Sound and Vision, Berkeley
Homes, Taylor Wimpey, Barratt Homes and David Wilson Homes.
CHAIRMAN'S STATEMENT
I am delighted to report record trading results for Armour Group plc for the
year ended 31 August 2007, which show significant growth over last year. Group
sales have increased by 33% to #57.4 million (31 August 2006: #43.0 million) and
operating profit has increased by 40% to #3.8 million (31 August 2006: #2.7
million as restated).
In September 2007, we announced the sale of the non-core, custom installation
services business. The Group is now fully focused on its fast growing and highly
successful branded product businesses in the home and automotive markets. Having
adjusted for the sale, the Group's sales and operating profit from continuing
operations have increased by 38% and 46% respectively.
The Group has reported strong net cash inflow from operating activities of #5.4
million (31 August 2006: #3.0 million). This has reduced net debt to #2.9
million (31 August 2006: #5.2 million). The deferred consideration for Alphason
Designs Limited ("Alphason") was agreed and settled in October 2007.
Basic underlying earnings per share from continuing operations have grown by 16%
to 5.0p (31 August 2006: 4.3p as restated). The proposed final dividend has been
increased by 18% to 0.65p (31 August 2006: 0.55p) per ordinary share.
Both our core operating divisions have enjoyed good growth in both sales and
operating profit. Armour Automotive reported sales growth of 6% and an increase
in operating profit of 25% in challenging market conditions. Armour Home's
continuing operations, which include a full year's contribution from Alphason,
have seen sales increase by 60% and operating profit by 52%. On a like-for-like
basis, sales and operating profit were up 23% and 12% respectively.
Sales in the UK from continuing operations were up by 44% overall and 18% on a
like-for-like basis. Export sales were up 10%. The Group now exports to 63
countries around the world. We have continued to expand our channels to market
over the past year. This expansion has taken our products into the hotel market,
luxury goods retailers and television shopping channels. We have also launched a
new e-commerce web site, www.endulgence.co.uk.
During the year, we were pleased to be appointed as the exclusive UK distributor
for Tivoli, the prestige radio brand, and NAD and PSB, the world-renowned hi-fi
brands. Following this appointment, our relationship with Lenbrook Corporation
of Canada, owners of the NAD and PSB brands, has grown. In September 2007, we
announced the appointment of Lenbrook America as the exclusive distributor in
the USA of Armour Home's award winning range of QED cables and interconnects.
Our investment in new product development remains central to our strategy for
delivering year-on-year organic growth. Last year we invested a record amount in
developing high quality products to add to our brand portfolio. We have in place
many new product programmes, which, we expect, will deliver innovative and
exciting new products over the coming year.
The success of the Group is a reflection of the hard work, dedication and
professionalism of our employees. Once again, I would like to acknowledge the
Board's appreciation of their commitment and efforts over the year.
The Group continues to invest significantly in new product development, promote
our high quality brand portfolio and develop our channels to market. This
strategy lies at the heart of achieving organic growth and maintaining our
position as one of the UK's leading consumer electronics groups in the
automotive and home markets. The Board remains confident of the Group's future
prospects.
BOB MORTON
Chairman
6 November 2007
Consolidated Profit and Loss Account
For the year ended 31 August 2007
Restated*
31 August 31 August
2007 2006
Note #000 #000
Turnover
Continuing operations 2 55,171 40,004
Discontinued operations 2,4 2,185 2,977
57,356 42,981
Operating profit
Continuing operations 2 4,118 2,826
Discontinued operations 2,4 (360) (139)
3,758 2,687
Share of loss in associated 3 (15) -
undertakings
Loss on disposal of discontinued 4 (2,711) -
operations
Profit on ordinary activities 1,032 2,687
before interest
Interest receivable 22 29
Interest on discounted deferred (113) (159)
consideration
Interest payable and similar (652) (508)
charges
Profit on ordinary activities 289 2,049
before taxation
Taxation on profit on ordinary 5 (1,155) (563)
activities
(Loss)/profit for the year 8 (866) 1,486
Earnings/(loss) per ordinary share 7
From continuing and discontinued operations
Basic (1.3)p 2.4p
Diluted (1.3)p 2.4p
From continuing operations
Basic 3.1p 2.6p
Diluted 3.1p 2.5p
From discontinued operations
Basic (4.4)p (0.2)p
Diluted (4.4)p (0.1)p
* Note 1
Consolidated Statement of Total Recognised Gains and Losses
For the year ended 31 August 2007
Restated*
31 August 31 August
2007 2006
#000 #000
(Loss)/profit for the year
Group (851) 1,486
Associated undertakings (15) -
(866) 1,486
Currency translation differences on foreign (7) -
currency net investments
Total recognised gains and losses relating to (873) 1,486
the year
Share-based payment prior year adjustment (Note 1) (72)
Total gains and losses recognised since last (945)
statutory financial statements
* Note 1
Consolidated Balance Sheet
At 31 August 2007
Restated*
Note 31 August 31 August
2007 2006
#000 #000
Fixed assets
Intangible assets 19,914 23,338
Tangible assets 1,741 2,256
Investments 3 357 -
22,012 25,594
Current assets
Stocks 10,490 9,836
Debtors 11,721 9,993
Cash at bank and in hand 892 186
23,103 20,015
Creditors: amounts falling due
within one year
Creditors (15,860) (13,547)
Borrowings (714) (1,610)
(16,574) (15,157)
Net current assets 6,529 4,858
Total assets less current 28,541 30,452
liabilities
Creditors: amounts falling
due after more than one year - (127)
Creditors
Borrowings (3,082) (3,767)
(3,082) (3,894)
Net assets 25,459 26,558
Capital and reserves
Called up ordinary share 6,848 6,841
capital
Share premium account 8,513 8,496
Other reserves 871 871
Profit and Loss Account 9,427 10,550
Share trust reserve (200) (200)
Shareholders' funds 8 25,459 26,558
* Note 1
Consolidated Cash Flow Statement
For the year ended 31 August 2007
Note 31 August 2007 31 August 2006
#000 #000 #000 #000
Net cash inflow from operating 9(a) 5,353 3,032
activities
Returns on investments and
servicing of finance
Interest received 22 29
Interest paid (507) (470)
Bank loan arrangement costs - (150)
Interest element of finance lease (4) (7)
rentals
Net cash outflow from returns on (489) (598)
investments and servicing of finance
Corporate taxation paid (919) (649)
Capital expenditure and financial
investment
Payments to acquire tangible assets (825) (920)
Sale of tangible assets 84 25
Net cash outflow from capital
expenditure and financial investment (741) (895)
Acquisitions and disposals
Purchase of subsidiary undertakings (155) (10,402)
Net cash acquired with subsidiary - 3,659
undertakings
Investment in associated (372) -
undertakings
Net cash outflow from acquisitions (527) (6,743)
and disposals
Dividend paid (371) (296)
Net cash inflow/(outflow) before 2,306 (6,149)
financing
Financing
Issue of ordinary share capital 24 5,892
New bank loans - 5,000
Repayment of bank loans (720) (3,483)
Capital element of finance lease (44) (56)
rental repayments
Net cash (outflow)/inflow from (740) 7,353
financing
Net cash inflow after financing,
being the 9(b) 1,566 1,204
increase in cash in the year
Notes to the preliminary financial information
1. Basis of preparation
The financial information set out in this announcement does not constitute the
Group's financial statements for the year ended 31 August 2007 and the year
ended 31 August 2006. Financial statements for the year ended 31 August 2006
have been delivered to the Registrar of Companies and those for 2007 will be
delivered in due course. The auditors' report on both accounts was unqualified,
did not include references to any matters to which the auditors drew attention
by way of emphasis without qualifying their report and did not contain a
statement under section 237 (2) - (3) of the Companies Act 1985.
In accordance with Rule 20 of the AIM Rules, the full audited accounts of Armour
Group plc for the year ended 31 August 2007 are expected to be posted to
shareholders no later than 19 November 2007 and will be available to the public
at the Company's registered office, Lonsdale House, 7-9 Lonsdale Gardens,
Tunbridge Wells, Kent, TN1 1NU and available to view on the Company's website at
www.armourgroup.uk.com from that date.
This year the Group has adopted FRS 20: Share-based payment. In accordance with
the transitional provisions of FRS 20, it has been applied retrospectively to
all grants of equity instruments made after 7 November 2002 that remained
unvested as at 1 September 2006.
The Group's figures for the year ended 31 August 2006 have been restated to
reflect the adoption of FRS 20. The restatement has resulted in a net decrease
in profit of #72,000, being the share-based payment charge net of deferred
taxation of #31,000. Net assets at 31 August 2006 have increased by #56,000,
being the deferred taxation asset for the year ended 31 August 2006 and a
further deferred taxation asset of #25,000 relating to those share-based
payments that had been granted after 7 November 2002 but that had not vested by
1 September 2005.
The Group's share-based payment charge for the year ended 31 August 2007 is
#121,000.
2. Turnover and operating profit by class of business
31 August 2007 31 August 2006
Operating Operating
Turnover Profit Turnover Profit
#000 #000 #000 #000
Continuing operations
Armour Automotive 17,290 2,180 16,381 1,744
Armour Home 37,881 4,604 23,623 3,026
Amortisation of goodwill - (1,168) - (1,012)
Central costs - (1,498) - (932)
Total continuing operations 55,171 4,118 40,004 2,826
Discontinued operations
Armour Home 2,185 (269) 2,977 (49)
Amortisation of goodwill - (91) - (90)
Total continuing operations 2,185 (360) 2,977 (139)
Total Group 57,356 3,758 42,981 2,687
3. Investment in associated undertakings
In September 2006, the Group acquired a 25% strategic investment in Audica
Limited. In the Group's financial statements, this has been accounted for using
the equity method of accounting. The Consolidated Profit and Loss Account
includes the Group's share of the operating results, interest, pre-taxation
results and attributable taxation. The Consolidated Balance Sheet shows the
Group's share of identifiable net assets including any unamortised premium paid
on acquisition. This premium is amortised to nil through the Consolidated Profit
and Loss Account in equal instalments over its estimated useful life of 20
years.
#000
25% of net liabilities acquired 4
Consideration paid including costs 372
Premium paid on acquisition 376
Investment made in associated 372
undertakings
Amortisation of acquisition premium (18)
Share of profit in associated undertaking 3
Carrying value of investment at 31 August 357
2007
4. Discontinued operations
In August 2007, the Group sold the entire share capital of Armour Custom
Services Limited and The Hi-End Limited, which together formed the custom
installation services business segment within Armour Home. The loss on disposal
has been calculated as follows:
#000
Fixed assets 463
Stocks 547
Debtors 600
Creditors (183)
1,427
Sale proceeds 400
Cost of sale (30)
Provision for onerous lease (120)
250
Loss before goodwill (1,177)
Goodwill written off (1,534)
Loss on disposal (2,711)
5. Taxation on profit on ordinary activities
31 August 31 August
2007 2006
#000 #000
UK Corporation Tax at 30% (2006:30%) (1,121) (699)
Adjustment in respect of prior years 10 39
Overseas taxation (38) (20)
Current taxation (1,149) (680)
Deferred taxation - current year (6) 86
Deferred taxation - prior year (Note 1) - 31
(1,155) (563)
6. Dividend
31 August 31 August
2007 2006
#000 #000
Proposed dividend for the year of 0.65p (2006: (439) (371)
0.55p)
per ordinary share
The Board is recommending an 18% increase in the final dividend for the year of
0.65p (31 August 2006: 0.55p) per ordinary share. The dividend is payable on 11
January 2008 to shareholders on the register on 14 December 2007. The proposed
dividend for the year has not been accrued in the Consolidated Balance Sheet as
at 31 August 2007. The dividend proposed in the financial statements as at 31
August 2006, and approved by shareholders at the Annual General Meeting held on
12 December 2006, was paid during the year.
7. Earnings/(loss) per ordinary share
The weighted average number of ordinary shares in issue during the year was
67,493,840 (31 August 2006: 61,664,304). Diluted earnings per share is
calculated with reference to 68,831,976 (31 August 2006: 63,184,137) ordinary
shares. The effect of the exercise of options on the weighted average number of
ordinary shares in issue is 1,338,136 (31 August 2006: 1,519,833).
The 966,000 ordinary shares held by the Armour Employees' Share Trust are not
included in either the weighted average, or diluted weighted average, ordinary
shares in issue during the year.
Underlying earnings per ordinary share is also shown calculated by reference to
earnings before the amortisation of goodwill, non-operating exceptional items
and share-based payments. The Directors consider that this gives a useful
additional indication of underlying performance.
Continuing and discontinued operations:
31 August 2007 31 August 2006
#000 Basic p Diluted #000 Basic p Diluted
p p
(Loss)/profit for the (866) (1.3) (1.3) 1,486 2.4 2.4
year
Amortisation of goodwill 1,259 1.9 1.8 1,102 1.8 1.7
Loss on disposal of 2,711 4.0 4.0 - - -
discontinued
operations
Share-based payments 87 0.1 0.1 72 0.1 0.1
(Note 1)
Underlying earnings 3,191 4.7 4.6 2,660 4.3 4.2
Continuing operations:
The profit from continuing operations is calculated in the table below:
31 August 31 August
2007 2006
#000 #000
(Loss)/profit for the year (866) 1,486
Loss for the year from discontinued operations 268 98
Loss on disposal of discontinued operations 2,711 -
Profit from continuing operations 2,113 1,584
The loss for the year from discontinued operations is the operating loss of
#360,000 (31 August 2006: #139,000) less the taxation benefit of #92,000 (31
August 2006: #41,000).
31 August 2007 31 August 2006
#000 Basic p Diluted #000 Basic p Diluted
p p
Profit for the year 2,113 3.1 3.1 1,584 2.6 2.5
Amortisation of goodwill 1,168 1.8 1.7 1,012 1.6 1.6
Share-based payments 83 0.1 0.1 68 0.1 0.1
(note 1)
Underlying earnings 3,364 5.0 4.9 2,664 4.3 4.2
8. Reconciliation of movements in shareholders' funds
31 August 2007 31 August 2006
#000 #000
Opening shareholders' funds as 26,502 18,819
previously reported
Prior year adjustment (Note 1) 56 25
Opening shareholders' funds restated 26,558 18,844
(Loss)/profit for the year (866) 1,486
Dividend paid (371) (296)
(Loss)/profit for the year retained (1,237) 1,190
New share capital subscribed 24 6,120
New share capital issue costs - (228)
Ordinary shares issued as - 529
consideration for acquisition
Share-based payments 121 103
Currency translation differences on (7) -
foreign currency investments
Net movement in shareholders' funds (1,099) 7,714
Closing shareholders' funds 25,459 26,558
9. Group cash flow statement
(a) Reconciliation of operating profit to net cash inflow from operating
activities
31 August 31 August
2007 2006
#000 #000
Operating profit 3,758 2,687
Depreciation and other amounts written off 784 760
tangible fixed assets
Amortisation of goodwill 1,259 1,102
Share-based payments 121 103
Increase in stocks (1,201) (724)
Increase in debtors (1,926) (173)
Increase/(decrease) in creditors 2,549 (737)
Loss on disposal of tangible fixed assets 9 14
Net cash inflow from operating activities 5,353 3,032
(b) Reconciliation of net cash flow to movement in net debt
31 August 2007 31 August 2006
#000 #000
Increase in cash 1,566 1,204
New bank loans - (5,000)
Repayment of bank loans 720 3,483
Cash outflow from finance leases 44 56
Change in net debt resulting from 2,330 (257)
cash flows
New finance leases - (114)
Bank loan arrangement costs - 150
Bank loan arrangement costs (35) (31)
expensed
Exchange adjustments (8) -
Movement in net debt in the year 2,287 (252)
Opening net debt (5,191) (4,939)
Closing net debt (2,904) (5,191)
(c) Analysis of net debt movement
Other
31 August Cash flow non-cash Exchange 31 August
2006 #000 changes #000 2007
#000 #000 #000
Cash 186 714 - (8) 892
Overdraft (852) 852 - - -
(666) 1,566 - (8) 892
Short-term debt (688) 720 (720) - (688)
Long-term debt (3,767) - 685 - (3,082)
Finance leases (70) 44 - - (26)
(5,191) 2,330 (35) (8) (2,904)
10. Annual General Meeting
The Annual General Meeting will be held at the offices of Arnold & Porter (UK)
LLP, Tower 42, 25 Old Broad Street, London, EC2N 1HQ on 11 December 2007 at
12.00 noon.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR EAXFSEENXFFE
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