ENSOR HOLDINGS PLC - Preliminary Results

22 July 2016

ENSOR HOLDINGS PLC

Preliminary results for the year ended 31 March 2016

Chairman’s Statement

_________________________________________________________________________________________

This has been a very active period for the Ensor Group. We have successfully sold three of our businesses, profitably disposed of land and property assets and dealt with our pension obligations. This is in addition to making progress in our remaining businesses where overall margins have improved despite unsettled trading conditions.

Excluding Ensor Building Products, which contributed only six months’ trading to our Group results this year, against a full twelve months last year, the Ensor Group has increased annual sales by 6% (2016: £16.0million, 2015: £15.1million). Gross margins have also increased from 28.3% in 2015 to 28.8% this year.

Ellard, our subsidiary which supplies electric motors and controls for the automation of doors and gates, has continued to gain market share, increasing sales by 15% during the year. The company sources a large proportion of its products from the Far East and pays for them in US dollars. Despite unsettled currency markets, margins have been largely unaffected. New products have been successfully launched by Ellard during the year and we have constructed additional production space at the company’s Manchester warehouse and distribution centre.

OSA Door Parts supplies the same markets as Ellard. The Company manufactures bespoke insulated industrial and garage doors. These are supplied to installers and dealers throughout the UK and Eire. Margins have increased at OSA during the year and, although the construction market during the second half of the year was flat, we are now seeing a growing order book.

Wood’s Packaging continues to make progress and gain increased market share. Margins have been robust but US dollar exchange rates are a challenge due to the increasing levels of goods purchased from the Far East.

A year ago we announced that, following a strategic review of our business, we had decided to look for a buyer for the Group. At the half-year, I said that we had concluded that a series of trade sales of our subsidiary businesses was preferred to seeking a buyer for the shares of Ensor Holdings PLC.

During the year to 31 March 2016 we sold Ensor Building Products to the management of that business for £1.44million, realising a profit on the sale of £168,000. The freehold property occupied by Ensor Building Products has also been sold at a premium of £147,000 against the book value.

As previously reported, we have also sold our land holdings in Woodville and Stockport during the year, these have realised a profit of £785,000 on disposal.

When I last reported to you on the half year, I said that we intended to purchase an annuity to secure all future liabilities of the Ensor Group Pension Fund, as a precursor to a buyout and winding up of the scheme. An annuity was purchased in December 2015 at a cost of £5.4million in addition to the scheme assets and the process to wind up the scheme has been started.

After financing this annuity purchase, the Group remained financially strong with net borrowings of only £819,000 at the year-end.

Earlier in July we disposed of a further two of our subsidiaries, OSA Door Parts and Technocover.  The Technocover consideration was £10million, paid in cash, with an amount of £250,000 held in retention for a period of eighteen months from completion. An additional £1.1million of cash was transferred to Ensor prior to completion of the sale, in a debt-free, cash-free transaction. We originally purchased 90% of the shares in Technocover in 2012, for a nominal sum. The remaining 10% of the shares were acquired in 2014 for £1million.

We also disposed of OSA Door Parts in July this year for £2.5million, paid in cash, with an additional £520,000 of cash transferred to Ensor prior to completion of its sale.  This transaction was, again, debt-free and cash-free.  OSA had been a business start-up for Ensor in 2001.

Our remaining businesses are being actively marketed, and we are speaking to a number of interested potential buyers. It is not our intention, however, to sacrifice shareholder value for the sake of an early sale.

I can again report that we are proposing to pay an increased net final dividend of 1.55p per share, making a total dividend paid and proposed of 2.3p per share for the year. This is an increase of 21% against a total dividend of 1.9p per share last year. The dividend will be paid in cash only, on 22 September 2016, to shareholders registered on 12 August 2016. The ex-dividend date will be 11 August 2016.

May I finally thank all the men and women around the Group for your continued hard work during the year. I can assure you that we have everybody’s interests in mind. Also, my thanks to our shareholders for continuing to support the company.

K A Harrison TD
Chairman
22 July 2016

Strategic Report

_____________________________________________________________________________________________

Operating results and future developments

The results for Continuing Operations comprise those of Ensor Holdings PLC, Ellard Limited (“Ellard”), OSA Door Parts Limited (“OSA”), Wood’s Packaging Limited (“Wood’s”) and Ensor Building Products Limited (“EBP”). EBP was sold in October 2015, but its scale did not warrant treatment as discontinued. OSA has not been treated as discontinued because the requirements to do so were not fulfilled at the year-end.

Discontinued operations comprise the results of Technocover Limited, which was disposed of on 13 July 2016.

Continuing operations

Sales of £19.2million include £16.0million in respect of the three businesses which were subsidiaries of the group throughout the year and £3.2million in respect of EBP. The former saw sales increase by £897,000, or 5.9% year-on-year.

Operating profit has been sub-analysed in the Consolidated Income Statement to highlight the exceptional elements associated with the program of disposals which have taken place during the report year and are addressed later in this report.

Operating profit before exceptional gains reduced by £242,000 to £1,701,000, due to:

·      the absence of EBP from the consolidated figures after September 2015;

·      the allocation of central costs increased by a reduction in rental income, which had previously been deducted from central costs, following property disposals; and

·      the disposal of the waste transfer business which constituted the ‘Other’ operating segment.

Before the allocation of central costs, the operating profits of the continuing Building Products and Packaging businesses increased by £22,000 year-on-year despite less favourable US dollar and euro exchange rates during the second half of the year.

Ellard continued to increase market share, growing sales by 15% to £8.5million, representing a 3-year compound annual growth rate of 14%.

Although contribution levels were diluted by strategic product decisions and exchange rate movements towards the end of the previous year, they strengthened through the current year; the strong sales growth ensuring that gross margins were maintained.

Increased overheads reflect the investment made in people and premises, in particular, which underpins the established past, and expected future, growth in sales and profits.

Operating profit of £890,000 represented a 10% increase over the preceding year.

OSA’s sales growth has been more modest over the last three years, with turnover amounting to £4.1million for the report year. Nevertheless, the business continued to perform strongly, posting an operating profit of £498,000.

Gross margins were strong throughout the year, reinforced by relative euro weakness for most of the period, and overheads were contained at prior-year levels, reflecting a measured performance.

Whilst the strengthening euro presented a challenge to maintaining margins, the business has developed opportunities in its product portfolio to counter that challenge.

Our Packaging segment, represented by Wood’s, again reported healthy sales and achieved 3-year compound annual growth in excess of 17%.

Sales of £3.6million, coupled with maintained, robust margins and controlled overheads, yielded an operating profit of £628,000.

The business was relocated to larger premises during the year, an event which was successfully managed to ensure negligible disruption, and now has ample capacity to sustain further growth.

The group-wide programme of business and asset disposals diminishes the overall income generation potential of the group, but the constituent businesses remain strong.

Exceptional gains

The reported operating profit of £2,861,000 includes exceptional gains of £1,160,000 relating to the various categories of asset disposals completed during the year:

·      the disposals, for gross proceeds of £3,034,000, of the Woodville and Stockport freeholds, which were classified as held-for-sale in 2015, created a gain of £785,000 net of disposal costs;

·      the disposals of the Woodville waste transfer business and Blackburn freehold used by EBP for £935,000 represented a net gain of £207,000; and

·      the disposal of the EBP shareholding for £1,441,000 realised a net gain of £168,000.

Finance costs

Finance costs principally comprise bank loan and overdraft interest and the financing cost on the defined benefit pension scheme.

Last year we recognised a credit of £198,000 in respect of an interest hedge on a bank loan, which had been the subject of a mis-selling claim. This credit countered the majority of the normal charge.

This year, the interest cost of the pension fund has reduced, from £89,000 to nil, following the purchase of an annuity to secure the liabilities of the pension scheme.

Income tax

The tax charge of £383,000 represents 13.6% of profit before tax, varying from the main UK corporation tax rate of 20% principally as a consequence of the utilisation of brought forward capital losses and the tax exempt status of the disposal of the EBP shareholding.

The tax benefit of the pension transaction debit is reflected in the Consolidated Statement of Comprehensive Income along with the charge to which it relates.

Discontinued operation

The composition of the profit derived from the discontinued operation, is detailed in note 2 to the financial statements.

As reported last year, Technocover’s current year trading benefitted from a carry-over of AMP5 orders which resulted in an unusually strong order book at the beginning of the year. This enabled an expected result to be returned despite the new AMP6 programme of the water industry being slower than expected to get underway.

Although sales were maintained at £14.7million, the trading result was moderated by the inefficient, end-of-contract nature of elements of the carried over work. Additional costs were incurred to strengthen the technical subcontracting capabilities of the business, which will benefit the future, and increased depreciation charges, attributable to significant capital investment since 2014, also constrained profits.

Statement of Comprehensive Income

In addition to the retained profit for the year, the Statement of Comprehensive Income includes a net debit of £2.9million in respect of the securing of the group’s pension deficit. This broadly represents the excess of the actual buyout cost over and above the deficit recorded on an ongoing accounting basis, net of taxation.

Essentially, it cost the company £5.6million to secure the brought forward deficit of £2.1million, crystallising a loss of £3.5million, against which we expect to recover tax of £0.6million.

Cash flow and financial position

The group’s cash flow is dominated by the realisation of significant assets and the cost of securing uncertain pension obligations.

The exceptional disposals of businesses and freehold properties generated cash of £5.3million, which essentially matched the exceptional payments of £5.4million required to finance benefit transfers and the purchase of an annuity to secure the obligations of the defined benefit pension scheme for which Ensor is responsible.

Otherwise, operating cash flow of £3.3million made possible a £762,000 reduction in net debt and year-end gearing of 7.1%.

A term loan of £2million replaced a corresponding part of the established overdraft facility, reflecting the expectation that it will be repaid out of further asset disposals.

Significant changes to the composition of the group Statement of Financial Position are attributable to the past and anticipated business and asset disposals, and to the hedging of the pension deficit.

After accounting for profits, dividend payments and the pension fund transaction, net assets have reduced marginally to £11.3million.

Disposals after the year end

On 11 July 2016 the entire issued share capital of OSA Door Parts Limited was sold to Argent Industrial Limited for consideration of £2,500,000.

The consideration was payable in cash on completion. In addition, net cash of £520,000 was retained by Ensor. The value of assets disposed of was approximately £879,000.

On 13 July 2016 the entire issued share capital of Technocover Limited was sold to Lionweld Kennedy Flooring Limited, a subsidiary of Hill & Smith Holdings PLC, for a total cash consideration of £10,000,000 on a debt and cash free basis.

Out of the consideration, which was payable in cash on completion, an amount of £250,000 has been retained in escrow for up to 18 months.  In addition, net cash of £1,100,000 was retained by Ensor. The value of assets disposed of was £3,695,000, subject to any balancing receipt or payment in respect of completion accounts in due course.

Dividend

The directors propose to pay a final dividend of 1.55p per share in respect of the financial year ended 31 March 2016 (2015: 1.3p). Dividends of £613,000, being the final dividend of 1.3p and interim dividend of 0.75p, were paid on ordinary shares during the year ended 31 March 2016 (2015: £479,000).

Dividends paid and proposed
In respect of the year ended 31 March:		2016	2015
Interim dividend paid		0.75p	0.6p
Final dividend proposed		1.55p	1.3p
		______	______
		2.30p	1.9p
		______	______

Consolidated Income Statement
for the year ended 31 March 2016

_________________________________________________________________________________________

		2016	2015 Restated
		£’000	£’000
Continuing operations
Revenue		19,170	21,452
Cost of sales		(13,989)	(16,034)
		______	______
Gross profit		5,181	5,418
Administrative expenses		(2,320)	(3,475)
		______	______
Operating profit before exceptional gains		1,701	1,943
Exceptional administrative gains:
Gain on disposal of assets classified as held-for-sale		785	-
Gain on disposal of fixed assets		207	-
Gain on disposal of subsidiary company		168	-
Operating profit		2,861	1,943
Finance costs		(42)	(34)
		______	______
Profit before tax		2,819	1,909
Income tax expense		(383)	(397)
		______	______
Profit for the year on continuing operations		2,436	1,512
Discontinued operation		792	1,164
		______	______
Profit for the year attributable to equity shareholders of the parent company		3,228	2,676
		______	______
Earnings per share – basic and diluted
On ordinary activities excluding exceptional gains and discontinued operations		4.3p	5.1p
On exceptional gains including taxation		3.9p	-
		______	______
Continuing operations including taxation		8.2p	5.1p
Discontinued operation including taxation		2.6p	3.9p
		______	______
Earnings per share		10.8p	9.0p
		______	______

Consolidated Statement of Comprehensive Income

		£’000	£’000
Profit for the year		3,228	2,676
		_____	_____
Items which will not be reclassified to profit or loss:
Actuarial loss		(3,462)	(403)
Income tax relating to components of other comprehensive income		579	60
		_____	_____
Total of other comprehensive income for the year		(2,883)	(343)
		_____	_____
Total comprehensive income attributable to equity shareholders of the parent company		345	2,333
		___ __	___ __

The results for the year ended 31 March 2015 have been restated for the discontinued operation (note 4).

Consolidated Statement of Financial Position
at 31 March 2016

______________________________________________________________________________________

		2016	2015
		£’000	£’000
ASSETS
Non-current assets
Property, plant & equipment		520	4,170
Intangible assets		1,074	2,671
Deferred tax asset		590	428
		______	______
Total non-current assets		2,184	7,269
		______	______
Current assets
Assets held for sale		530	2,185
Assets of disposal group held for sale		7,252	1,975
Inventories		2,382	3,063
Trade and other receivables		4,359	8,381
Cash and cash equivalents		1,536	564
		______	______
Total current assets		16,059	16,168
		______	______
Total assets		18,243	23,437
		______	______
LIABILITIES
Non-current liabilities
Retirement benefit obligations		-	(2,139)
Borrowings		(1,065)	(246)
Other creditors		-	(22)
Deferred tax		-	(182)
		______	______
Total non-current liabilities		(1,065)	(2,589)
		______	______
Current liabilities
Borrowings		(795)	(1,863)
Liabilities of disposal group held for sale		(2,803)	(946)
Current income tax liabilities		(73)	(561)
Trade and other payables		(2,325)	(6,028)
		______	______
Total current liabilities		(5,996)	(9,398)
		______	______
Total liabilities		(7,061)	(11,987)
		______	______
NET ASSETS		11,182	11,450
		______	______
EQUITY
Share capital		3,082	3,082
Share premium		552	552
Revaluation reserve		-	140
Retained earnings		7,548	7,676
		______	______
Total equity attributable to equity shareholders of the parent company		11,182	11,450
		______	______

The financial statements were approved by the board and were authorised for issue on 22 July 2016.  They were signed on its behalf by:

 

Directors

A R Harrison             )
M A Chadwick           )

Consolidated Statement of Changes in Equity
for the year ended 31 March 2016

_______________________________________________________________________________________

Attributable to equity shareholders of the parent company

	Issued Capital	Share  Premium	Revaluation reserve	Retained Earnings	Total Equity
	£’000	£’000	£’000	£’000	£’000
Balance as at 1 April 2014	3,082	552	140	5,822	9,596
	_____	_____	_____	_____	_____
Profit for the year	-	-	-	2,676	2,676
Other comprehensive income:
Actuarial loss	-	-	-	(403)	(403)
Related deferred tax	-	-	-	60	60
	_____	_____	_____	_____	_____
Total comprehensive income for the year	-	-	-	2,333	2,333
	_____	_____	_____	_____	_____
Dividends paid	-	-	-	(479)	(479)
	_____	_____	_____	_____	_____
Total transactions recognised directly in equity	-	-	-	(479)	(479)
	_____	_____	_____	_____	_____
Balance at 31 March 2015	3,082	552	140	7,676	11,450
	_____	_____	_____	_____	_____
Balance as at 1 April 2015	3,082	552	140	7,676	11,450
	_____	_____	_____	_____	_____
Profit for the year	-	-	-	3,228	3,228
Other comprehensive income:
Actuarial loss	-	-	-	(3,462)	(3,462)
Related deferred tax	-	-	-	579	579
	_____	_____	_____	_____	_____
Total comprehensive income for the year	-	-	-	345	345
	_____	_____	_____	_____	_____
Dividends paid	-	-	-	(613)	(613)
Transfer or surplus to retained earnings on disposal of properties	-	-	(140)	140	-
	_____	_____	_____	_____	_____
Total transactions recognised directly in equity	-	-	(140)	(473)	(613)
	_____	_____	_____	_____	_____
Balance at 31 March 2016	3,082	552	-	7,548	11,182
	_____	_____	_____	_____	_____

Share premium
The share premium account represents the consideration that has been received in excess of the nominal value of shares on issue of new ordinary share capital, less permitted expenses.
Revaluation reserve
The revaluation reserve represents the unrealised surplus arising on the revaluation of certain of the group’s freehold properties.

Retained earnings
The retained earnings reserve represents profits and losses retained in the current and previous periods.

Consolidated Cash Flow Statement
for the year ended 31 March 2016

_________________________________________________________________________________________

		2016	2015
		£’000	£’000
Net cash generated from ordinary operations		2,498	184
Payment in excess of liability to clear pension fund deficit		(5,601)	-
		_______	_______
Net cash generated from/(used in) operations		(3,103)	184
		_______	_______
Cash flows from investing activities
Net proceeds from sale of property, plant and equipment		926	739
Net proceeds from sale of assets held for sale		2,968	-
Net proceeds from sale of subsidiary		1,275	-
Purchase of property, plant and equipment		(674)	(746)
		_______	_______
Net cash generated from/(used in) investing activities		4,495	(7)
		_______	_______
Cash flows from financing activities
Equity dividends paid		(613)	(479)
New finance leases		241	-
Amounts repaid in respect of finance leases		(44)	(20)
Deferred consideration paid		-	(1,000)
New bank loans		2,000	-
Loan repayments		(472)	(278)
		_______	_______
Net cash generated from/(used in) financing activities		1,112	(1,777)
		_______	_______
Net increase/(decrease) in cash and cash equivalents		2,504	(1,600)
Opening cash and cash equivalents		(1,015)	585
		_______	_______
Closing cash and cash equivalents		1,489	(1,015)
		_______	_______

Accounting Policies and Notes to the Financial Statements

for the year ended 31 March 2016

1.   Basis of preparation

The consolidated financial statements of Ensor Holdings PLC have been prepared in accordance with the Companies Act 2006 and International Financial Reporting Standards (IFRS) as adopted by the European Union in accordance with the rules of the London Stock Exchange for companies trading securities on the Alternative Investment Market. The group financial statements have been prepared under the historical cost convention, as modified by the revaluation of land and buildings, and derivative financial instruments at fair value through profit or loss. The principal accounting policies adopted by the group are set out below.

2.   Basis of consolidation

Where the company has control over an investee, it is classified as a subsidiary. The company controls an investee if all three of the following elements are present:

·        power over the investee

·        exposure to variable returns from the investee, and

·        the ability of the investor to use its power to affect those variable returns.

Control is reassessed whenever facts and circumstances indicate that there may be a change in any of these elements of control.

The consolidated financial statements present the results of the company and its subsidiaries as if they formed a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.

The consolidated financial statements incorporate the results of business combinations using the acquisition method. In the statement of financial position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the consolidated statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date on which control ceases.

3.   Segmental analysis

The principal subsidiaries of the group, together with brief descriptions of their activities, are as follows:

·      Ellard Limited – Design, manufacture and distribution of electric drives for industrial, commercial and domestic doors and gates

·      Ensor Building Products Limited (sold October 2015) – Marketing and distribution of roofing, drainage and specialist building products.

·      OSA Door Parts Limited – Manufacture and distribution of industrial doors and door components for the trade.

·      Technocover Limited – Manufacture and installation of high-security steel access products for the utilities market.

·      Wood’s Packaging Limited – Marketing and distribution of packaging materials and furniture protectors.

For management purposes, the group’s business activities are organised into business units based on their products and services and have three primary operating segments as follows:

·      Building and Security Products – manufacture, marketing, supply and distribution of building materials, security access products and access control equipment;

·      Packaging – marketing and distribution of packaging materials;

·      Other – waste recycling.  The waste recycling operation was disposed of on 1 April 2015.

These segments are the basis on which information is reported to the group board. The segment result is the measure used for the purposes of resource allocation and assessment and represents the operating profit of each segment before exceptional operating costs, amortisation and impairment charges, other gains and losses, net finance costs and taxation.

Details of the types of products and services from which each segment derives its revenues are given above.

The accounting policies applied in preparing the management information for each of the reportable segments are the same as the group’s accounting policies.

The group’s revenues and results by reportable segment for the year ended 31 March 2016 are shown in the following table.

	Building & Security Products	Packaging	Other	Unallocated	Total continuing	Total dis-continued	Total
	£’000	£’000	£’000	£’000	£’000	£’000	£’000
External revenue	15,578	3,592	-	-	19,170	14,711	33,881
	_____	_____	_____	_____	_____	_____	_____
Depreciation	129	23	-	49	201	461	662
	_____	_____	_____	_____	_____	_____	_____
Operating profit	1,187	514	-	1,160	2,861	993	3,854
	_____	_____	_____	_____
Finance costs					(42)	-	(42)
Income tax expense					(383)	(201)	(584)
					_____	_____	_____
Profit for the year					2,436	792	3,228
					_____	_____	_____
Total assets	8,735	2,143	-	113	10,991	7,252	18,243
	_____	_____	_____	_____	_____	_____	_____
Total liabilities	(1,782)	(687)	-	(1,789)	(4,258)	(2,803)	(7,061)
	_____	_____	_____	_____	_____	_____	_____
Capital expenditure	94	60	-	-	154	520	674
	_____	_____	_____	_____	_____	_____	_____

The group’s revenues and results by reportable segment for the year ended 31 March 2015 are shown in the following table.

	Building & Security Products	Packaging	Other	Unall-ocated	Total continuing	Total dis-continued	Total
	£’000	£’000	£’000	£’000	£’000	£’000	£’000
External revenue	17,951	3,336	165	-	21,452	14,684	36,136
	_____	_____	_____	_____	_____	_____	_____
Depreciation	241	28	14	-	283	316	599
	_____	_____	_____	_____	_____	_____	_____
Operating profit	1,360	530	53	-	1,943	1,421	3,364
	_____	_____	_____	_____
Finance costs					(34)	-	(34)
Income tax expense					(397)	(257)	(654)
					_____	_____	_____
Profit for the year					1,512	1,164	2,676
					_____	_____	_____
Total assets	12,161	2,249	55	1,757	16,222	7,215	23,437
	_____	_____	_____	_____	_____	_____	_____
Total liabilities	(3,026)	(672)	(5)	(4,208)	(7,911)	(4,076)	(11,987)
	_____	_____	_____	_____	_____	_____	_____
Capital expenditure	135	18	1	108	262	484	746
	_____	_____	_____	_____	_____	_____	_____

Head office costs are apportioned to the segments on the basis of earnings.  Inter-segment sales are charges at prevailing market prices.

The group operates almost exclusively in one geographical segment, being the United Kingdom.  Turnover to customers located outside the United Kingdom accounted for less than 10% of total group turnover and has therefore not been separately disclosed.

Revenue from a single customer did not exceed more than 10% of turnover during the current or prior reporting periods.

4.   Discontinued operation

The profits of Technocover Limited have been classified as a discontinued operation and the company’s assets and liabilities are classified in the balance sheet as being held for sale.  Negotiations commenced in March 2016 for the sale of the whole of the share capital of Technocover and the sale was completed on 13 July 2016 for a total consideration of £10,000,000 on a debt and cash free basis.  The prior year income statement has been restated to reflect the discontinued operation.

The results of the discontinued operation were as follows:

	2016	2015
	£’000	£’000
Revenue	14,711	14,684
Expenses	(13,718)	(13,263)
	______	______
Operating profit	993	1,421
Income tax expense	(201)	(257)
	______	______
	792	1,164
	______	______

The sale of OSA Door Parts Limited was completed on 11 July 2016 for a consideration of £2,500,000, together with net cash of £520,000 retained by Ensor.  The profits were not classified as discontinued as the disposal of the entity did not meet the conditions for classification as held for sale at the year end.

The sale of Ensor Building Products Limited on 1 October 2015 has not been treated as a discontinued operation as it did not represent a separate major line of business or geographical area of operations.

The cash flows of the discontinued operation were as follows:

	2016	2015
	£’000	£’000
Operating	1,576	1,317
Investing	(515)	(483)
Financing	(89)	(298)
	______	______
Total cash flow	972	536
	______	______

5.  Earnings per share

The calculation of earnings per share for the period is based on the profit for the period divided by the weighted average number of ordinary shares in issue, being 29,895,976 (2015: 29,895,976), which excluded treasury shares.  There are no dilutive instruments in place.

6.    Cash flow generated from operations

	2016	2015
	£’000	£’000
Cash flows from operating activities
Profit for the year attributable to equity shareholders	3,228	2,676
Depreciation charge	662	599
Finance costs	42	34
Income tax expense	584	654
Profit on disposal of held for sale subsidiary	(168)	-
Profit on disposal of assets held for sale	(785)	-
Profit on disposal of property, plant & equipment	(191)	(131)
Amortisation of intangible asset	33	33
	_______	_______
Operating cash flow before changes in working capital	3,405	3,865
(Increase)/decrease in inventories	424	(1,208)
(Increase)/decrease in receivables	1,179	(2,928)
Increase/(decrease) in payables	(1,907)	637
	_______	_______
Cash generated from operations	3,101	366
Net interest (paid)/refunded	(42)	104
Income taxes paid	(561)	(286)
	_______	_______
Net cash generated from ordinary operations	2,498	184
	_______	_______

7.   Other information

The financial information set out in this preliminary announcement of results does not constitute the company’s statutory accounts for the years ended 31 March 2016 or 31 March 2015 but is derived from those accounts.  Statutory accounts for 2015 have been delivered to the Registrar and those for 2016 will be delivered following the company’s Annual General Meeting.  The Independent Auditors have reported on these accounts.  Their reports were unqualified and did not contain a statement under section 498 of the Companies Act 2006.

The Annual General Meeting of the company will be held at the company’s registered office, Ellard House, Floats Road, Manchester M23 9WB at 10.00 a.m. on 15 September 2016.

The Report and Accounts will be sent to shareholders and be available from the company’s website at http://www.ensor.co.uk/ shortly.  Additional copies of the Annual Report and of this statement will be available at the company’s registered office.

Enquiries:

Ensor Holdings PLC: Roger Harrison / Marcus Chadwick - 0161 945 5953

Stockdale Securities Limited: Robert Finlay / Rose Ramsden - 020 7601 6100

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