We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Register to chat with like-minded investors on our interactive forums.
| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Eurocell Plc | LSE:ECEL | London | Ordinary Share | GB00BVV2KN49 | ORD GBP0.001 |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| -2.50 | -1.82% | 134.50 | 133.00 | 136.00 | 135.00 | 133.50 | 135.00 | 65,594 | 12:58:21 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Plastics Products, Nec | 364.5M | 9.6M | 0.0857 | 15.69 | 150.72M |
From Apr 2019 to Apr 2024
TIDMECEL
RNS Number : 8384H
Eurocell plc
23 August 2016
Eurocell plc
Half Year Results for the Six Months ended 30 June 2016
STRONG H1 SALES GROWTH, ROBUST PROFITABILITY AND A POSITIVE START TO H2
23 August 2016
Eurocell plc, a market leading, vertically integrated UK manufacturer and distributor of innovative window, door and roofline PVC products, today announces its unaudited results for the six months ended 30 June 2016
Hot Features
Premium
H1 2016 H1 2015 Year ended
GBP'000 GBP'000 change December
2015
Revenue 97,220 82,545 18% 175,947
Gross margin
% 52.1% 52.2% (0.1) 51.7%
Adjusted EBITDA(1) 14,220 13,038 9% 29,731
Adjusted PBT(2) 10,748 9,591 12% 23,019
PBT 10,293 6,317 63% 19,696
Adjusted basic
EPS (pence)(3) 8.72 7.61 15% 18.60
Basic EPS (pence) 8.35 4.57 83% 15.51
Dividend per
share (pence) 2.8 2.7 4% 7.9
Net debt (31,252) (33,256) (6%) (25,871)
Notes
(1) Adjusted EBITDA represents earnings before interest, tax, depreciation, amortisation and non-recurring costs. (2) Adjusted PBT represents profit before tax and non-recurring costs. (3) Adjusted basic EPS excludes non-recurring costs and the related tax effect.
(4) Non-recurring costs for H1 2016 comprise duplicated costs relating to the handover period during which the company employed two CEO's, as well as professional fees related to the acquisition of Vista Panels Limited (see note 5). Non-recurring costs for H1 2015 comprise professional fees incurred in connection with the company's IPO.
Highlights
Financial
-- Strong first half performance, in-line with market expectations.
-- Revenue growth of 18% despite the slow-down in Repair, Maintenance and Improvement ('RMI') market. Revenue growth
of 11% excluding acquisitions.
-- Gross margin maintained and adjusted PBT 12% ahead of H1 2015.
-- Interim dividend increased by 4% to 2.8 pence per share.
Operational
-- Appointment of Mark Kelly as CEO from May 2016 and Michael Scott as CFO from September 2016. -- Continued expansion of the branch network to 148, an increase of 7 sites since December 2015. -- Further innovation in new Modus, Skypod and Equinox product ranges. -- Acquisition of Vista Panels in March 2016, performing in line with expectations. -- Increase in use of recycled PVC in manufactured products. -- Positive start to the second half of the year.
Commenting on the group's performance, Bob Lawson, Chairman of Eurocell, said:
"I am delighted to report a strong performance in the first half of the year. Notwithstanding market conditions that have remained challenging, we have reported higher revenues and profits. We have also made firm progress with all of our strategic priorities - product innovation, expansion of our branch network and the acquisition of Vista Panels Limited.
"Looking forward, the result of the EU referendum has created uncertainty. However, we have made a good start to the second half of the year with sales +17% (+8% excluding acquisitions) over the first seven weeks of the period and we believe that our proven strategy and capabilities will enable Eurocell to deliver value to our customers and shareholders throughout the remainder of 2016 and beyond.
"I am pleased that Mark Kelly has settled in well and look forward to welcoming Michael Scott as CFO, thereby ensuring that we have the experienced team in place with the knowledge to assure the future success of Eurocell."
Enquiries:
Eurocell plc Tel: +44 1773 842100
Mark Kelly, Chief Executive Officer
Teneo Strategy Tel: +44 20 3603 5221
Ben Foster
Camilla Cunningham
Chief Executive's Statement
I am pleased to report a strong set of results for the first half of 2016.
Group revenue grew by 18% (11% excluding acquisitions), ahead of a muted overall RMI market. At the same time, we maintained our gross margin through enhanced procurement measures, an improved manufacturing performance and lower raw material costs. This led to a 12% increase in adjusted PBT on last year. We have also seen a positive contribution to the first half performance from our continued investment in new branches and supporting structure and from our investment in factory operations which allow increased use of recycled product and lower scrap levels.
We remain committed to a strategy of growing the business by expanding the branch network and increasing spend per customer by continuing to bring innovative new products to market, combining a one-stop shop with excellent customer service.
The winning of two additional major trade fabricators at the end of 2015 is helping to drive our performance in the current year. One is a major trade fabricator which operates throughout the UK and the other will provide a strong base in the commercial market.
Despite softening in July and August, demand for our brands in the new build market continues to grow and our ability to supply excellent products through our fabricator network is supporting growth in this area. Our close working relationships with a number of the major house builders continues to develop, nurtured through good technical support plus market specific innovation leading to tight specifications. The continued expansion in the use of recycled PVC windows remains attractive to the new build market and our fabricator order books have now been rebuilt through to the end of the year.
In March 2016 we successfully completed the acquisition of Vista Panels Limited for a net cash consideration of GBP6.3m. Vista specialises in the manufacture of composite and PVC entrance doors. For the 12 months immediately preceding the acquisition, Vista recorded revenue of GBP13.7m. The acquisition allows the company to extend its customer base and also provides further cross-selling opportunities for the extended product range. The integration is proceeding to plan and the business is performing in line with expectations.
We remain committed to our strategy of using recycled materials where possible and have plans to extend our recycling capacity in the second half of 2016. This will contribute towards lower overall resin prices but will also assist with the mitigation of any current and future adverse movements in raw material prices arising as a result of exchange rate movements.
After my first 5 months in the business I believe Eurocell is a business with an excellent opportunity to take control of its own destiny. The markets are going to be challenging as economic uncertainty undermines confidence, but Eurocell is in a position where it can continue to drive its tried and tested initiatives harder whilst introducing further ideas with a view to continuing to take market share.
Operational review
Profiles Division
Revenue increased to GBP42.4m (2015: GBP35.2m), an increase of GBP7.2m, of which GBP5.6m is from acquisitions (S & S Plastics GBP2.5m and Vista Panels GBP3.1m).
In the first half of the year we continued to experience a muted RMI market which we expect to continue into the second half of the year. Despite this, we have seen solid growth in the private new build sector with output up 8% on the same period last year. Looking at our customer base, we are seeing positive trends across the spectrum: our larger trade fabricators are benefiting from economies of scale and automation which is allowing them to grow share by supplying smaller retailer fabricators. Pleasingly we are still seeing growth from our smaller fabricators who are using the Eurocell brand to good effect and also assisting with the supply of windows through to our branch network.
We are seeing a continued shift in demand for our products, with a greater emphasis on thermal efficiency from our new build and public sector customers. Additionally we are seeing a greater demand for our high value-add products such as bi-fold doors, Skypods, coloured windows and doors which is driving growth in margin and profitability across the business.
Building Plastics Division
Revenue increased to GBP54.8m (2015: GBP47.4m) as a result of both branch openings and improved like for like performance (+12%).
We opened 7 new branches in the first half of the year and we will continue to grow our branch network with a plan of opening 12 more in H2 2016. New branch openings create downward pressure on profitability in the short term, but are necessary to ensure future growth. We plan to reduce the costs associated with new branches to expedite the time taken to become profitable. Further, in line with our plans, we have also continued to drive branch profitability through resetting branch incentives and reviewing product lines available in branch. Sales of windows through branches has doubled to GBP3.3m. There is increased focus on higher margin value added product sales (Equinox and Skypod) to fabricators. The acquisition of Vista Panels has driven growth in the sales of doors in the branches and we expect to see continued benefits coming through from this acquisition into the second half.
Current trading and outlook
While we have benefited from low PVC resin prices in H1, prices have risen in July and August and there are indications that prices will be higher for the second half of the year. However, we expect to be able to partially mitigate this through our increasing use of recycled material.
In the first seven weeks of the second half, total sales are +17% (+8% excluding acquisitions). This, together with our first half performance, underpins our expectations for the full year, which remain consistent with the most recently published analyst forecasts.
Other than the uncertainty surrounding the economy as a result of the EU referendum, the principal risks and uncertainties are not anticipated to materially change in H2 2016 from those outlined in pages 26 and 27 of the 2015 Annual Report and Accounts.
Financial review
Revenue growth for the period was 18%. This has been achieved through a combination of above market share gains across our branch network, new profiles customers secured in 2015 and the impact of recent acquisitions. Excluding acquisitions our revenue growth for the period was 11%.
Gross margin for the period was 52.1% (2015: 52.2%). While we have benefited from low PVC resin prices in H1, prices have risen in July and August and there are indications that prices will be higher for the second half of the year. However, we expect to be able to partially mitigate this through a number of initiatives including our increasing use of recycled material.
Excluding the impact of acquisitions, total overheads increased by GBP4.4m. This increase is in line with our strategy and includes the following highlights:
-- Expansion of the branch network to 148 (December 2015: 141). -- Investments in management to support further branch expansion. -- Costs associated with our first full year as a listed company. -- Investment to enhance our specification team to ensure further pull through for our product.
While our strong sales growth has resulted in additional direct manufacturing overhead, efficiencies achieved in manufacturing have kept unit costs in line with management expectations. During the period, waste levels reduced by 1.7 percentage points, operational equipment efficiency improved by 11%, and usage of recycled material increased from 8% of usage to 14%.
The company identified non-recurring costs of GBP455,000 in H1 2016 (H1 2015: GBP3,274,000). Non-recurring costs for H1 2016 comprise duplicated costs relating to the handover period during which the company employed two CEO's, as well as professional fees related to the acquisition of Vista Panels Limited. Non-recurring costs for H1 2015 comprise professional fees incurred in connection with the company's IPO in March 2015.
The group benefited from significantly reduced finance costs following the refinancing at the IPO. The company continues to monitor its funding arrangements closely and is comfortably within the terms of its financial covenants.
The effective tax rate for the period was 19% (2015: 28%). The rate was high in 2015 as a result of disallowable IPO costs.
The group continues to invest in its future with capital expenditure for the period of GBP2.7m (H1 2015: GBP3.2m). Our planned investment of approximately GBP2.0m in recycling and GBP3.4m on other capital expenditure is expected in the second half of 2016 and will deliver cost benefits in 2017. This will mean that the full year capital expenditure is forecasted to be GBP8.1m.
As noted above, the company acquired Vista Panels Limited in March 2016. Whilst the impact on earnings is not expected to be particularly significant in 2016, the group expects a more meaningful contribution to profits next year.
The Board is pleased to declare an interim dividend of 2.8 pence per share. This represents an increase of 4% over last year. The shares will trade ex-dividend on 8 September 2016 and the dividend will be paid on 7 October 2016 to shareholders on the register at 9 September 2016.
Half Year Results for the Six Months ended 30 June 2016
Responsibility Statement of the Directors in respect of the Half Year Results
We confirm that to the best of the Directors' knowledge:
-- the condensed set of financial statements has been prepared in accordance with International Accounting Standard
34 'Interim Financial Reporting' (IAS 34) as adopted by the EU and;
-- 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
Bob Lawson Mark Kelly
Chairman Chief Executive Officer
22 August 2016 22 August 2016
C Consolidated Statement of Comprehensive Income
6 months ended 30 6 months ended 30 Year ended 31 December
June 2016 June 2015 2015
Note Recurring Non-recurring Total Recurring Non-recurring Total Recurring Non-recurring Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Audited) (Audited) (Audited)
Revenue 4 97,220 - 97,220 82,545 - 82,545 175,947 - 175,947
Cost of sales (46,559) - (46,559) (39,424) - (39,424) (84,945) - (84,945)
Gross profit 50,661 - 50,661 43,121 - 43,121 91,002 - 91,002
Distribution
costs (7,145) - (7,145) (6,954) - (6,954) (12,310) - (12,310)
Administrative
expenses (32,365) (455) (32,820) (25,685) (3,274) (28,959) (54,398) (3,323) (57,721)
Operating
profit 11,151 (455) 10,696 10,482 (3,274) 7,208 24,294 (3,323) 20,971
Finance expense (403) - (403) (891) - (891) (1,275) - (1,275)
Profit before
tax 10,748 (455) 10,293 9,591 (3,274) 6,317 23,019 (3,323) 19,696
Taxation 6 (2,029) 89 (1,940) (2,007) 241 (1,766) (4,454) 241 (4,213)
Profit for
the period 8,719 (366) 8,353 7,584 (3,033) 4,551 18,565 (3,082) 15,483
------------ -------------- ------------ ------------ -------------- ------------ ---------- -------------- ----------
Earnings per
share (pence) 8 8.72 8.35 7.61 4.57 18.60 15.51
The group has no other comprehensive income in the current or prior year.
Consolidated Statement of Financial Position
30 June 30 June 31 December
2016 2015 2015
Note GBP000 GBP000 GBP000
(Unaudited) (Unaudited) (Audited)
Assets
Non-current assets
Property, plant and equipment 10 27,713 26,348 27,635
Intangible assets 10 20,119 13,879 14,517
------------ ------------ ------------
Total non-current assets 47,832 40,227 42,152
------------ ------------ ------------
Current assets
Inventories 18,886 17,283 18,054
Trade and other receivables 31,255 25,947 24,944
Cash and cash equivalents 2,580 7,431 1,176
------------ ------------ ------------
Total current assets 52,721 50,661 44,174
------------ ------------ ------------
Total assets 100,553 90,888 86,326
------------ ------------ ------------
Liabilities
Current liabilities
Bank overdrafts - - (1,327)
Trade and other payables (30,017) (27,554) (27,092)
Provisions (48) - (76)
Corporation tax (1,980) (1,961) (1,196)
------------ ------------ ------------
Total current liabilities (32,045) (29,515) (29,691)
------------ ------------ ------------
Non-current liabilities
Borrowings (33,832) (40,687) (25,720)
Trade and other payables (355) - (500)
Provisions (1,442) (1,331) (1,366)
Deferred tax (3,020) (1,335) (2,493)
------------ ------------ ------------
Total non-current liabilities (38,649) (43,353) (30,079)
------------ ------------ ------------
Total liabilities (70,694) (72,868) (59,770)
------------ ------------ ------------
Net assets 29,859 18,020 26,556
------------ ------------ ------------
Equity attributable to
equity holders of the
parent
Share capital 100 100 100
Share premium 1,926 1,926 1,926
Other reserves 530 76 380
Retained earnings 27,303 15,918 24,150
------------ ------------ ------------
Total equity 29,859 18,020 26,556
------------ ------------ ------------
Consolidated Cash Flow Statement
6 months 6 months Year
ended ended ended
30 June 30 June 31 December
2016 2015 2015
Note GBP000 GBP000 GBP000
(Unaudited) (Unaudited) (Audited)
Cash generated from operations 11 10,711 8,910 26,268
Non-recurring costs 5 455 3,274 3,323
Cash generated from underlying
operations 11,166 12,184 29,591
Income taxes paid (1,158) (3,586) (5,729)
Non-recurring costs paid (273) (4,404) (4,453)
Net cash from operating
activities 9,735 4,194 19,409
------------ ------------ ------------
Investing activities
Acquisition of subsidiary,
net of cash acquired 9 (6,332) - (1,662)
Purchase of property,
plant and equipment 10 (2,129) (3,157) (6,267)
Disposal of property,
plant and equipment - - 75
Purchase of intangible
assets 10 (567) (85) (85)
Net cash used in investing
activities (9,028) (3,242) (7,939)
------------ ------------ ------------
Financing activities
Redemption of preference
shares - (50) (50)
Proceeds from bank borrowings 8,000 41,000 41,000
Repayment of bank and
other borrowings (485) (33,599) (48,599)
Finance expense (291) (3,623) (4,023)
Dividends paid to equity
shareholders (5,200) - (2,700)
Net cash from/(used in)
financing activities 2,024 3,728 (14,372)
------------ ------------ ------------
Net increase/(decrease)
in cash and cash equivalents 2,731 4,680 (2,902)
Cash and cash equivalents
at the beginning of the
period (151) 2,751 2,751
------------ ------------ ------------
Cash and cash equivalents
at the end of the period 2,580 7,431 (151)
------------ ------------ ------------
Net debt
Cash and cash equivalents 2,580 7,431 1,176
Bank overdrafts - - (1,327)
Bank loans (33,832) (40,687) (25,720)
------------ ------------ ------------
(31,252) (33,256) (25,871)
------------ ------------ ------------
Consolidated Statement of Changes in Equity
For the 6 months ended 30 June 2016 (unaudited)
Note Share Share Retained Other Total attributable
capital premium earnings reserves to equity
holders
of parent
GBP000 GBP000 GBP000 GBP000 GBP000
Balance at 1
January 2016 100 1,926 24,150 380 26,556
Comprehensive
income for the
period
Profit for the
period - - 8,353 - 8,353
--------- ----------- ---------- ---------- -------------------
Total comprehensive
income for the
period - - 8,353 - 8,353
Contributions
by and distribution
to owners
Share based payments - - - 127 127
Deferred tax
on share based
payments - - - 23 23
Dividends paid 7 - - (5,200) - (5,200)
--------- ----------- ---------- ---------- -------------------
Total contributions
by and distributions
to owners - - (5,200) 150 (5,050)
Balance at 30 June
2016 100 1,926 27,303 530 29,859
For the 6 months
ended 30 June 2015
(unaudited) GBP000 GBP000 GBP000 GBP000 GBP000
Balance at 1
January 2015 52 99 11,367 - 11,518
Comprehensive
income for the
period
Profit for the
period - - 4,551 - 4,551
--------- ----------- ---------- ---------- -------------------
Total comprehensive
income for the
period - - 4,551 - 4,551
Contributions
by and distribution
to owners
Preference shares
redeemed in the
period (50) - - - (50)
Shares issued
during the period 98 1,827 - - 1,925
Share based payments - - - 76 76
Total contributions
by and distributions
to owners 48 1,827 - 76 1,951
Balance at 30 June
2015 100 1,926 15,918 76 18,020
For the year ended 31 December 2015 (audited)
Note Share Share Retained Other Total attributable
capital premium earnings reserves to equity
holders
of parent
GBP000 GBP000 GBP000 GBP000 GBP000
Balance at 1
January 2015 52 99 11,367 - 11,518
Comprehensive
income for the
year
Profit for the
year - - 15,483 - 15,483
Total comprehensive
income for the
year - - 15,483 - 15,483
Contributions
by and distributions
to owners
Preference shares
redeemed during
the year (50) - - - (50)
Shares issued
during the year 98 1,827 - - 1,925
Share based payments - - - 380 380
Dividends paid 7 - - (2,700) - (2,700)
Total contributions
by and distributions
to owners 48 1,827 (2,700) 380 (445)
--------- --------- ---------- ---------- -------------------
Balance at 31
December 2015 100 1,926 24,150 380 26,556
--------- --------- ---------- ---------- -------------------
Notes to the Half Year Results
for the Six Months ended 30 June 2016
1. Basis of preparation
The half year report of Eurocell plc for the
6 months ended 30 June 2016 reflects the results
of the company and its subsidiaries (together
referred to as "the group"). It has been prepared
in accordance with IAS 34 "Interim Financial
Reporting" as adopted by the European Union
and the Disclosure and Transparency rules
of the Financial Conduct Authority.
The half year financial statements are condensed
in accordance with IAS 34.
The half year report does not constitute statutory
accounts as defined in Section 434 of the
Companies Act 2006. It does not include all
the information required for full annual statements
and should be read in conjunction with the
full annual report for the 12 months ended
31 December 2015.
The comparative figures for the 12 months
ended 31 December 2015 are extracted from
the group's audited statutory accounts for
that financial year, which have been delivered
to the Registrar of Companies. The auditor's
report was (i) unqualified, (ii) did not include
a reference to any matters to which the auditors
drew attention by way of emphasis without
qualifying their audit report, and (iii) did
not contain a statement under Section 498
(2) or (3) of the Companies Act 2006.
The half year report is unaudited, but has
been reviewed by the auditors in accordance
with the Auditing Practices Board guidance
on Review of Interim Financial Information.
The half year report was approved by the Board
of Directors on 22 August 2016.
2. Going concern
The half year report is prepared on a going
concern basis. This is considered appropriate
given that the Directors are satisfied that
the group has adequate resources to continue
in operation for the foreseeable future, a
period of not less than 12 months from the
date of this report.
3. Accounting policies and estimates
The half year report has been prepared applying
the accounting policies and presentation that
were applied in the preparation of group's
published financial statements for the year
ended 31 December 2015. Adoption of new standards,
amendments or interpretations to published
standards have no material impact on the group.
The preparation of the half year report requires
management to make judgements, estimates and
assumptions that affect the application of
accounting policies and the reported amounts
of assets and liabilities, income and expenses.
Actual results may differ from estimates.
The significant judgements made by management
in applying the group's accounting policies
and the key sources of estimation in the consolidated
financial statements for the year ended 31
December 2015 remain unchanged in the current
period.
4. Segment information
The group has the following reportable segments:
Profiles, Building Plastics and Corporate.
6 months ended 30 Building
June 2016
(unaudited) Profiles Plastics Corporate Total
GBP000 GBP000 GBP000 GBP000
Revenue
Total revenue 61,254 55,132 - 116,386
Inter-segmental revenue (18,862) (304) - (19,166)
Total revenue from
external customers 42,392 54,828 - 97,220
Adjusted EBITDA 11,408 2,654 158 14,220
Amortisation (331) (67) (258) (656)
Depreciation (1,928) (282) (203) (2,413)
Operating profit/(loss)
before non-recurring
costs 9,149 2,305 (303) 11,151
---------------- --------- ---------- ---------
Non-recurring costs (455)
Finance expense (403)
Profit before tax 10,293
---------
6 months ended 30
June 2015
(unaudited) GBP000 GBP000 GBP000 GBP000
Revenue
Total revenue 49,966 47,594 - 97,560
Inter-segmental revenue (14,771) (244) - (15,015)
Total revenue from
external customers 35,195 47,350 - 82,545
Adjusted EBITDA 9,530 3,580 (72) 13,038
Amortisation (12) (120) (244) (376)
Depreciation (1,788) (212) (180) (2,180)
Operating profit/(loss)
before non-recurring
costs 7,730 3,248 (496) 10,482
---------------- --------- ---------- ---------
Non-recurring costs (3,274)
Finance expense (891)
Profit before tax 6,317
---------
Year ended 31 December Building
2015
(audited) Profiles Plastics Corporate Total
GBP000 GBP000 GBP000 GBP000
Revenue
Total revenue 105,957 102,661 - 208,618
Inter-segmental revenue (32,088) (583) - (32,671)
Total revenue from
external customers 73,869 102,078 - 175,947
Adjusted EBITDA 21,608 8,384 (261) 29,731
Amortisation (234) (240) (661) (1,135)
Depreciation (3,473) (457) (372) (4,302)
Operating profit/(loss)
before non-recurring
costs 17,901 7,687 (1,294) 24,294
---------------- --------- ---------- ---------
Non-recurring costs (3,323)
Finance expense (1,275)
Profit before tax 19,696
---------
5. Non-recurring costs
Amounts included in the consolidated income
statement are as follows:
6 months 6 months Year
ended ended ended
30 June 30 June 31 December
2016 2015 2015
GBP000 GBP000 GBP000
(Unaudited) (Unaudited) (Audited)
Professional and other
costs relating to IPO - 3,274 3,323
Duplicated costs related 343 - -
to CEO handover period
Acquisition costs 112 - -
---------------- ------------ ------------
455 3,274 3,323
---------------- ------------ ------------
6. Taxation
6 months 6 months
ended ended Year ended
30 June 30 June 31 December
2016 2015 2015
GBP000 GBP000 GBP000
(Unaudited) (Unaudited) (Audited)
Current tax
Current tax on profits
for the period 2,021 1,658 3,758
Adjustments in respect
of prior periods (1) - (619)
Total current
tax 2,020 1,658 3,139
------------ ------------ -------------
Deferred tax
Origination and reversal
of temporary differences 214 349 1,129
Adjustments in respect
of prior periods (294) (241) (55)
Total deferred
tax (80) 108 1,074
------------ ------------ -------------
Tax expense in the consolidated
statement of comprehensive
income 1,940 1,766 4,213
------------ ------------ -------------
The reasons for the difference between the actual
tax charge for the year and the standard rate
of corporation tax in the United Kingdom applied
to profits for the year are as follows:
Profit before tax 10,293 6,317 19,696
------------ ------------ -------------
Expected tax charge based
on the standard rate
of corporation tax in
the UK of 20% (2015:
20.25%) 2,059 1,279 3,988
Expenses not deductible
for tax purposes 166 587 825
Adjustments in respect
of Patent Box provisions (231) (187) (375)
Adjustments in respect
of prior periods (294) (241) (55)
Other 240 328 (170)
------------ ------------ -------------
Total tax expense 1,940 1,766 4,213
------------ ------------ -------------
The charge for year ended 31 December 2015 includes
disallowed costs related to the company IPO.
Changes in tax rates and factors affecting the
future tax charge
A reduction in the mainstream rate of UK corporation
tax from 21% to 20% took effect from April 2015.
A reduction to 19% from 1 April 2017 and 18%
from 1 April 2020 has been substantively enacted.
A further reduction to 17% from 1 April 2020
has not yet been substantially enacted.
7. Dividends
6 months 6 months Year ended
ended ended
30 June 30 June 31 December
2016 2015 2015
GBP000 GBP000 GBP000
(Unaudited) (Unaudited) (Audited)
Interim dividend
2.8p per ordinary
share (2015: 2.7p) 2,800 2,700 2,700
Final dividend
5.2p per ordinary
share - - 5,200
8. Earnings per share
Basic earnings per share is calculated by dividing
the net profit for the period attributable
to ordinary shareholders by the weighted number
of ordinary shares outstanding during the period.
Diluted earnings per share is calculated by
adjusting the earnings and number of shares
for the effects of dilutive options. Adjusted
earnings per share excludes non-recurring costs
and the related tax effect from the calculations.
6 months 6 months Year ended
ended ended
30 June 30 June 31 December
2016 2015 2015
GBP000 GBP000 GBP000
(Unaudited) (Unaudited) (Audited)
Profit attributable
to
ordinary shareholders 8,353 4,551 15,483
Profit attributable
to ordinary shareholders
excluding non-recurring
costs 8,719 7,584 18,565
Number Number Number
Weighted average
number of shares
- basic and diluted 100,000,000 99,629,235 99,816,141
Pence Pence Pence
Basic and diluted
earnings per share 8.35 4.57 15.51
Basic and diluted
adjusted earnings
per share 8.72 7.61 18.60
Acquisition of subsidiaries (unaudited)
9.
On 9 March 2016, the group acquired 100% of
the ordinary share capital of Vista Panels
Limited.
Vista is a manufacturer of composite and PVC
panel doors, supplying the social housing
and private RMI sectors. Vista is also the
sole supplier of composite doors to Eurocell
Building Plastics, while Eurocell Profiles
supplies Vista with profiles for use in the
manufacture of door frames.
The consideration paid was GBP6.7m (GBP6.3m
net of cash acquired). Related to the acquisition,
the group agreed to settle on completion,
GBP485,000 owed by Vista to its former ultimate
parent undertaking CorpAcq Limited.
Goodwill represents the supplier relationship
with Eurocell Building Plastics and potential
for cross selling between the Eurocell and
Vista customers. The amount of goodwill deductible
for tax purposes is GBPnil. The goodwill arising
on acquisition has been calculated as follows:
Acquiree's net assets Book value Fair value Provisional
at the acquisition on acquisition adjustment values
date: on acquisition
GBP000 GBP000 GBP000
Property, plant and
equipment 408 - 408
Intangible assets - 3,448 3,448
Inventories 947 38 985
Trade and other receivables 2,572 - 2,572
Cash and cash equivalents 355 - 355
Trade and other payables (2,155) (100) (2,255)
Amounts owed to former
parent (485) - (485)
Deferred tax 37 (621) (584)
----------------- ------------- ----------------
Net identifiable
assets and liabilities 1,679 2,765 4,444
----------------- ------------- ----------------
Cash consideration
paid 6,687
Goodwill on acquisition 2,243
----------------
Fair value adjustments
* The adjustment to intangible assets is to recognise
previously unrecognised intangible assets, and has
been valued using discounted cash flows.
* The adjustment in relation to inventories is to
recognise the fair value of finished goods acquired
on acquisition.
* The adjustment to trade and other payables is to
recognise a dilapidation provision in respect of the
leased premises occupied by Vista.
* The adjustment to deferred taxation is to recognise
the associated deferred tax liability arising on the
intangible assets.
Acquisition related costs
The group incurred acquisition related costs
of GBP112,000 in relation to professional
fees and transaction costs arising upon acquisition.
All such costs have been expensed to the consolidated
statement of comprehensive income and included
within non-recurring administrative expenses.
The contribution to the profits of the group
for the period since acquisition is not material
(GBP0.1m), although the group is expecting
a meaningful contribution to profits next
year.
10. Non-current assets (unaudited)
Property, Intangible
plant assets
and equipment
GBP000 GBP000
Balance at 1 January 2016 27,635 14,517
Additions 2,129 567
Additions on acquisition (note
9) 408 3,448
Goodwill arising on acquisition
(note 9) - 2,243
Disposals (46) -
Depreciation / amortisation (2,413) (656)
Balance at 30 June 2016 27,713 20,119
-------------------------- -----------
11. Reconciliation of profit after tax to net
cash flows from operating activities
6 months 6 months Year
ended ended ended
30 June 30 June 31 December
2016 2015 2015
GBP000 GBP000 GBP000
(Unaudited) (Unaudited) (Audited)
Profit after tax 8,353 4,551 15,483
Add back:
Taxation 1,940 1,766 4,213
Finance expense 403 891 1,275
Adjustments for:
Depreciation of property,
plant and equipment 2,413 2,180 4,302
Amortisation of intangible
assets 656 376 1,135
Loss on sale of property,
plant and equipment 46 65 -
Impairment of property,
plant and equipment - 233 234
Share based payments 127 76 322
Decrease / (increase)
in inventories 153 (2,553) (2,696)
(Increase) in trade
and other receivables (3,774) (5,403) (3,884)
Increase in trade and
other payables 346 6,696 5,741
Increase in provisions 48 32 143
Cash generated from
operations 10,711 8,910 26,268
------------ ------------ ------------
12. Related party transactions
The remuneration of executive and non-executive
Directors and members of the Executive Committee
will be disclosed in the 2016 annual financial
statements. Other related party transactions
have been disclosed below.
Transactions with key management personnel
H2 Equity Partners Limited is considered
to be a related party by virtue of a mutual
director.
Kalverboer Management UK LLP is controlled
by P H L Kalverboer, a non-executive director
of Eurocell plc, and a partner in H2 Equity
Partners.
The following management charges have been
made by the above companies.
6 months 6 months Year
ended ended ended
30 June 30 June 31 December
2016 2015 2015
GBP000 GBP000 GBP000
(Unaudited) (Unaudited) (Audited)
H2 Equity Partners
Limited - 49 49
Kalverboer Management
UK LLP 20 - 40
------------ ------------ ------------
20 49 89
------------ ------------ ------------
The amount outstanding at the end of each
period, in respect of the above, was GBP10,000.
Prior to the IPO certain shareholders held
loan notes with interest payable at 11%.
During the prior periods the amounts of interest
charged in the consolidated statement of
comprehensive income were:
GBP000 GBP000 GBP000
Coöperatief H2
Equity Partners Fund
IV Holding - 368 368
P Bateman - 4 4
M K Edwards - 2 2
G Parkinson - 1 1
A Smith - 1 1
I Kemp - 1 1
------------ ------------ ------------
On 3 March 2015 at the IPO the loan notes
and accrued interest were repaid in full
as follows:
GBP000 GBP000 GBP000
Coöperatief H2
Equity Partners Fund
IV Holding - - 20,462
P Bateman - - 176
M K Edwards - - 106
G Parkinson - - 35
A Smith - - 35
I Kemp - - 35
------------ ------------ ------------
13. Eurocell plc parent company balance sheet
The Directors have become aware that in the
December 2015 parent company balance sheet
of Eurocell plc, there was a misclassification
of GBP17.7m between amounts due from subsidiary
undertakings and investments in subsidiary
undertakings. Correcting this misclassification
has no impact on total assets, net assets
or retained earnings of the parent company
and the group. The correction will be by
way of a prior year adjustment included in
the parent company financial statements for
the year ended 31 December 2016.
Independent review report to Eurocell plc
Report on the condensed consolidated financial statements
Report on the condensed consolidated financial statements
Our conclusion
We have reviewed Eurocell plc's condensed consolidated financial statements (the "interim financial statements") in the half year report of Eurocell plc for the 6 month period ended 30 June 2016. Based on our review, nothing has come to our attention that causes us to believe that the interim financial statements are not prepared, in all material respects, in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union and the Disclosure Rules and Transparency Rules of the United Kingdom's Financial Conduct Authority.
What we have reviewed
The interim financial statements comprise:
-- the consolidated statement of financial position as at 30 June 2016;
-- the consolidated income statement and consolidated statement of comprehensive income for the period then ended;
-- the consolidated cash flow statement for the period then ended; -- the consolidated statement of changes in equity for the period then ended; and -- the explanatory notes to the interim financial statements.
The interim financial statements included in the half year report have been prepared in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union and the Disclosure Rules and Transparency Rules of the United Kingdom's Financial Conduct Authority.
As disclosed in note 1 to the interim financial statements, the financial reporting framework that has been applied in the preparation of the full annual financial statements of the Group is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union.
Responsibilities for the interim financial statements and the review
Our responsibilities and those of the Directors
The half year report, including the interim financial statements, is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the half year report in accordance with the Disclosure Rules and Transparency Rules of the United Kingdom's Financial Conduct Authority.
Our responsibility is to express a conclusion on the interim financial statements in the half year report based on our review. This report, including the conclusion, has been prepared for and only for the company for the purpose of complying with the Disclosure Rules and Transparency Rules of the United Kingdom's Financial Conduct Authority and for no other purpose. We do not, in giving this conclusion, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
What a review of interim financial statements involves
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures.
A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
We have read the other information contained in the half year report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the interim financial statements.
PricewaterhouseCoopers LLP
Chartered Accountants
Birmingham
22 August 2016
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR EANPAAFKKEFF
(END) Dow Jones Newswires
August 23, 2016 02:00 ET (06:00 GMT)
1 Year Eurocell Chart |
1 Month Eurocell Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
