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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Flowtech Fluidpower Plc | LSE:FLO | London | Ordinary Share | GB00BM4NR742 | ORD 50P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| -0.10 | -0.10% | 97.50 | 96.00 | 99.00 | 22,583 | 16:35:26 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Fluid Powr Cylindrs,actuatrs | 114.77M | -6.25M | -0.1017 | -9.60 | 60.02M |
From Apr 2019 to Apr 2024
TIDMFLO
RNS Number : 6250J
Flowtech Fluidpower PLC
13 September 2016
Tuesday, 13 September 2016
FLOWTECH FLUIDPOWER PLC
(Flowtech, the Group or Company)
Specialist technical fluid power products supplier
2016 HALF-YEAR REPORT FOR THE SIX MONTHSED 30 JUNE 2016
"Group organic growth and acquisition strategy underpins the platform for future development"
Hot Features
Premium
FINANCIAL HIGHLIGHTS HY2016 HY2015 FY2015 GROWTH
30.6.16 30.6.15 31.12.15 %
UNAUDITED UNAUDITED AUDITED
==================================== ============= ============= ============= ========
* REVENUE:
-Flowtechnology GBP18.093m GBP17.488m GBP33.168m +3%
-Power Motion Control (PMC) GBP8.268m GBP3.935m GBP11.680m +110%
-Process GBP1.026m - - -
GROUP TOTAL REVENUE GBP27.387m GBP21.423m GBP44.848m +28%
------------------------------------ ------------- ------------- ------------- --------
* GROSS PROFIT GBP9.551m GBP7.203m GBP15.345m +33%
* UNDERLYING OPERATING PROFIT GBP4.059m GBP3.404m GBP6.868m +19%
* OPERATING PROFIT GBP3.290m GBP3.012m GBP5.491m +9%
* HALF-YEAR DIVID 1.84p 1.75p +5%
* EARNINGS PER SHARE (basic) 5.91p 5.62p +5%
GBP14.1m GBP7.5m GBP9.0m
* NET DEBT
OPERATIONAL HIGHLIGHTS
===========================================================================
* SOLID FIRST HALF PERFORMANCE IN CHALLENGING MARKET
CONDITIONS
* STRONG MOMENTUM WITHIN THE RECENTLY ESTABLISHED PMC
AND PROCESS DIVISIONS
* GROSS MARGINS REMAIN RESILIENT ACROSS ALL DIVISIONS
* ACQUISITION STRATEGY DELIVERING EXCELLENT
OPPORTUNITIES TO ACQUIRE NICHE BUSINESSES WITH
SPECIALIST SECTOR FOCUS:
- THREE COMPLETED IN 2016 AND SIX SINCE BECOMING A PLC
- ALL INTEGRATIONS ON TARGET
- CONFIDENT OF FURTHER PROGRESS BEFORE THE OF THE YEAR
* EXPANDED CUSTOMER PROFILE INTO NEW USER MARKETS
including:
- AGRICULTURE, RAILWAY, ENVIRONMENTAL, WATER, PHARMACEUTICAL
* STRONG FOCUS ON INVESTING IN GROUP RESOURCES FOR THE
FUTURE
* NET DEBT COMFORTABLY WITHIN AVAILABLE FACILITIES AND
COVENANTS
"Flowtech remains confident in its ability to execute its proven strategy to develop in its technically specialised sectors in the UK and internationally. The Company is recognised as a skilled and resilient business operating in a fragmented fluid power distribution market. In addition to organic sales growth there remains a number of opportunities to further enhance Flowtech's multi-channel approach through; its investment in people and increased sales resource, the ongoing development of Exclusive Brand and OEM product offering, as well as through earnings enhancing acquisitions."
SEAN FENNON, CEO
FLOWTECH FLUIDPOWER PLC
The information contained within this announcement is deemed by the Company to constitute inside information stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain.
ENQUIRIES:
------------------------------------ ------------------------ -------------------------------
Flowtech Fluidpower plc Zeus Capital Limited TooleyStreet Communications
AiM: FLO (Nominated Adviser and (IR and media relations)
Malcolm Diamond MBE, Non-Executive Broker) Fiona Tooley
Chairman Andrew Jones, Dominic Tel: +44 (0) 7785 703523
Sean Fennon, Chief Executive King Email: fiona@tooleystreet.com
Officer Tel: +44 (0) 207 533
Bryce Brooks, Chief Financial 7727
Officer
Today: 13 September 2016
Tel: +44 (0) 1695 52796
Email: info@flowtechfluidpower.com
------------------------------------ ------------------------ -------------------------------
EDITORS NOTE:
--------------------------------------------------------------------------------------------------------------
Flowtech Fluidpower plc, founded as Flowtech in 1983, is the UK's leading
specialist supplier of technical fluid power products. The Group has three
divisions: Flowtechnology, Power Motion Control and Process. All three
of the Group's divisions have overlapping product sets, allowing procurement
synergies to be maximised. The Flowtechnology division focuses on supplying
distributors and resellers of industrial MRO (maintenance, repair and operation)
products, primarily serving urgent orders rather than bulk offerings. It
is formed from Flowtechnology UK, Flowtechnology Benelux and Indequip.
It offers an unrivalled range of Original Equipment Manufacturer (OEM)
and Exclusive Brand products to over 3,400 distributors and resellers.
Its catalogues are recognised as the definitive source for fluid power
products, containing approximately 106,000 individual product lines and
are distributed to more than 85,000 industrial Maintenance, Repair and
Overhaul end users (MRO). The Power Motion Control division specialises
in the design, assembly and supply of engineering components and hydraulic
systems and is further enhanced by a service and repair function. The division
is formed from Primary Fluid Power, Nelson Hydraulics and TSL Fluidpower.
The Process division focuses on the supply of industrial components to
the process sectors. This is the newest division in the Group, formed by
the acquisition of Hydravalve in March 2016. The Group's main distribution
centre is in Skelmersdale, Lancashire with further distribution centres
in the Netherlands and China. The Power Motion Control Division (PMC) has
operations in Merseyside, Northern Ireland, the Republic of Ireland, and
Yorkshire; Process operates from the West Midlands. In total the business
employs 324 people.
The Group has a clear view of its growth objectives - to create a specialist
fluid power organisation that remains focused on its core competencies
whilst servicing the varied industrial and manufacturing sectors through
its delivery of 'class-leading' service and support. Our long term growth
model is based on both organic growth, coupled with complementary acquisitions
in a very fragmented marketplace.
--------------------------------------------------------------------------------------------------------------
FLOWTECH FLUIDPOWER PLC
HALF-YEAR FINANCIAL REPORT FOR THE SIX MONTHSED 30 JUNE 2016
INTRODUCTION
It is pleasing to report that since joining AiM in 2014 the Group has:
ü Expanded its portfolio through the launch of over 3,000 new lines
across existing and new product categories
ü Completed six acquisitions: Primary, Albroco, Nelson, Indequip,
Hydravalve and TSL
ü Established three clearly-focussed divisions: Flowtechnology, Power
Motion Control and Process; and
ü Developed new strategic sales refinements and data processing resources
which will deliver improved operating efficiencies across the organisation
in the long term
As a business:
Ø We are in a unique position within the fluid power supply chain,
as we are aligned to both the global supply base and its distributor network.
We are in an exciting phase. Our offer continues to develop to the varied
industrial and manufacturing customers we supply everyday around the UK
and overseas.
As a Board:
Ø We remain optimistic that our wide range of revenue enhancing development
programmes, when linked to our acquisition strategy based on a clear multi-channel
approach, will continue to create significant opportunity for further growth
and increased market penetration. By developing our offer, we ensure that
the Group maintains its competitive advantage in each of the markets in
which it trades.
2016 HALF-YEAR FINANCIAL PERFORMANCE
We are pleased to report an encouraging first half trading performance,
all achieved against a backdrop where the economic conditions have been
challenging in most industrial markets across the key territories of the
UK and mainland Europe. Whilst accomplished primarily on the back of acquisition
activity, overall turnover growth year on year of 28% has continued to
raise our profile across new channels, assisting the business in adding
market share and reinforcing our position as one of the leading players
in the fluid power sector.
Although not defined under IFRS, the Directors believe that the underlying
operating results give a better understanding of the business' performance.
The table below details this is in summary and further information is contained
in note 3 of this Report.
Continuing operations Six months Six months % Year ended
Underlying operating ended ended Change 31 December
result* 30 June 30 June 2015
2016 2015 GBP000
GBP000 GBP000
----------------------- ----------- ----------- -------- -------------
Flowtechnology 4,164 4,086 2% 7,571
Power Motion Control 930 284 227% 1,228
Process 150 - - -
Central costs (1,185) (966) 23% (1,931)
----------------------- ----------- ----------- -------- -------------
Underlying operating
result* 4,059 3,404 19% 6,868
----------------------- ----------- ----------- -------- -------------
* Underlying operating result is continuing operations' operating profit
before acquisition costs, amortisation of acquired intangibles, share-based
payment costs and restructuring costs. Underlying operating result is reconciled
to statutory profit before tax in note 3 to the HY Report.
At divisional level, Flowtechnology UK was able to replace business lost
mainly in larger accounts with exposure to more difficult sectors, such
as the oil and gas industry. In addition, the acquisition of the trade
and assets of Indequip has added to our product portfolio, and allowed
a more direct market approach with significant sections of the potential
customer base. There remain many opportunities to develop our offer and
the Group has continued to invest in sales and marketing functions to exploit
these. In the Benelux, sales grew by 11.3% (5.3% in constant currency)
which has again lifted bottom line contribution proportionately.
In the Power Motion Control division, revenue in the first half grew by
110% to GBP8.3m, with the majority coming from the year on year effects
of the acquisitions of Nelson and Albroco. However, Primary also continued
to expand its sales profile after the erosion of its oil and gas related
business in early 2015. The Process division, established in the first
half of the 2016 has started well and contributed GBP1.0m to revenue.
Gross profit margins across all divisions remained consistent and strong
with no erosion experienced.
Our cost profiles in people, property and administration remain on target.
Central costs have increased year on year by GBP0.219m which includes bonuses
of GBP0.113m paid to the executive directors to reflect the increased scale
and complexity of the Group achieved since 2014. Overall the Group continues
to ensure that its central resources are able to support an expanding operational
profile as necessary whilst obtaining appropriate "economies of scale",
and it is firmly believed that the current resources available can support
considerable further growth in the Group's activities.
The Group is therefore able to report an underlying operating profit of
GBP4.059m (2015: GBP3.404m), an increase of 19% year on year.
Restructuring costs of GBP0.118m (2015: GBP0.010m) relate exclusively to
the cost of integration of new acquisitions into the Group and include
redundant short term property lease costs and redundancy of back office
services.
The Group outsources all professional services required to cover due diligence
and administrative integration, including IT, of new acquisitions into
the group and with three completed in the year to the date of this report
these costs have therefore increased to GBP0.238m (2015: GBP0.050m).
OUR BUSINESS STRATEGY FOR GROWTH
Our Group's core philosophy is unchanged - ie. to deliver profitable growth
while maintaining consistent high levels of service to our diverse customer
base. We have a solid technically based and resilient business model which
is underpinned by its ability to deliver strong cash generation and profitable
returns for all stakeholders.
During the last six months, we have added three successful businesses to
the Group further enhancing our exposure to specialist hydraulics, pneumatics
and the process industrial sectors: -
DATE BRAND FINANCIALS ON TOTAL
ACQUISITION CONSIDERATION
(net of cash in balance
sheet)
---------- --------------------- --------------------- -----------------------------
Revenue: GBP2.6m
FEBRUARY Indequip PBT: GBP0.1m GBP0.9m
2016 Net assets: GBP0.5m
---------- --------------------- --------------------- -----------------------------
Revenue: GBP4.0m GBP3.8m of which GBP1.7m
MARCH Hydravalve PBT: GBP0.6m is contingent on financial
2016 Net assets: GBP1.2m performance in the two-year
period to March 2018
---------- --------------------- --------------------- -----------------------------
Revenue: GBP1.2m GBP0.90m which GBP0.4m
JULY TSL Fluidpower* PBT: GBP0.15m is contingent on financial
2016 Net assets: GBP0.5m performance in the two-year
period to July 2018
---------- --------------------- --------------------- -----------------------------
*the trading style of Triplesix Ltd
There remains significant opportunity to add more niche acquisitions and
enhance organic growth through a mix of product development, value add
services and new customer opportunities.
FINANCIAL POSITION INCLUDING CASH FLOW AND BANK DEBT
Net operating cash flows (note 9) were GBP0.188m (2015: GBP1.659m), a reduction
of GBP1.471m. However, the majority of this variance relates to the expected
build-up of working capital in Indequip following the purchase of the trade
in February 2016, as well as the seasonal nature of working capital movements
in the Nelson operation, which was not included in the comparative due
to the acquisition date being after June 2015. The balance of the variance
represents the heavier bias in stock investment year on year as previously
reported. This was carried out to take advantage primarily of better pricing
opportunities in the Far East. This also has the added advantage of providing
some cushion against recent currency movements following the Brexit vote
in June 2016.
Net borrowings at 30 June 2016 were GBP14.1m. The extended bank facilities
agreed with Barclays and first reported last year have supported the Group's
acquisition activity and current headroom and covenants remain comfortable.
Overall the Board expects strong cash generation in the second half of
2016. Cash collections remain good across all sectors.
OUR PEOPLE
Delivering our goals and objectives we now have over 324 technically-skilled
staff employed across four countries and in nine locations. In order to
continue our development, we need good people with determination, drive
and technical know-how. We take this opportunity to welcome all new colleagues
who joined us during the first half of the year. The Board thanks everyone
around the business for their continuous hard work, dedication and loyalty,
which underpins both the high level customer relationships and the Group's
overall performance.
At Operating Board level, we congratulate John Farmer in his promotion
to Managing Director of Flowtechnology UK, and, we welcome both Hydravalve's
Managing Director, Andrew Newham and TSL's Managing Director, Steve Rushworth.
In March, we also welcomed Nick Fossey, joining the group from Eaton Corporation,
in his key role leading the future development of the PMC division across
the UK and Europe, where the opportunities for us to grow are extensive.
OUTLOOK
The Flowtech Group is developing both strength and depth across its product
portfolio, customer reach and, following recent acquisitions, it has been
able to widen the geographical areas and the industrial fluid power markets
it serves. It continues to develop a theme based on being a "specialist"
rather than a "generalist" and the margin opportunities this allows.
Low global confidence and economic uncertainty is influencing many industrial
sectors, particularly in the UK. We do believe this hiatus to be short
term, and remain confident for the future. As we previously indicated,
the Group operates in a "live" pricing environment and it is increasingly
certain that input prices for many core product lines will increase in
HY2 and early 2017 on the back of the sterling downgrade. The Board is
confident that we will be able to maintain overall margins by a mixture
of selling price increases and supplier support. The fluid power sector
as a whole has come to expect a heavy bias towards US Dollar and Euro denominated
supply lines and the macro economic situation is well understood by the
sector's decision makers.
Trading is in line with management expectations despite some disruption
over the immediate post Brexit vote period. Overall, we remain positive
that we can deliver results in line with market consensus forecasts and
are confident about the future. Our acquisition pipeline remains dynamic
and the Group is now established as a very credible option for investors
and owner managers across the sector who wish to exit their position.
DIVID
As shareholders are aware, the Board is focused on capital growth and increasing
ROCE. We are also committed to a progressive dividend policy based on the
Group's operational performance as a whole whilst balancing our investments
in the business for the future.
The Board is therefore pleased to declare a half-year dividend of 1.84p
(2015: 1.75p), a 5% increase. This interim dividend will be paid on 25
October 2016 to Members on the Register at the close of business on 30
September 2016. The shares will become ex-dividend on 29 September 2016.
The dividend is covered 3.4 times by earnings.
We look forward to keeping investors updated on our progress over the coming
months.
By order of the Board
12 September 2016
CONSOLIDATED INCOME STATEMENT
FOR THE SIX MONTHSED 30 JUNE 2016
--------------------------------------------------------------------------------------------------------------
Unaudited Unaudited Audited
Notes Six months Six months Year ended
ended 30 June ended 31 December
2016 30 June 2015
GBP000 2015 GBP000
GBP000
----------------------------------------------- ---------- ----------------- ------------- ---------------
Continuing operations
Revenue 3 27,387 21,423 44,848
Cost of sales (17,836) (14,220) (29,503)
----------------------------------------------- ---------- ----------------- ------------- ---------------
Gross profit 9,551 7,203 15,345
Distribution expenses (1,318) (1,065) (2,245)
----------------------------------------------- ---------- ----------------- ------------- ---------------
Administrative expenses before
separately disclosed items:
-Acquisition costs (4,174) (2,734) (6,232)
-Amortisation of acquired intangibles 3 (238) (50) (299)
-Share based payment costs 3 (264) (160) (413)
-Restructuring costs 3 (149) (172) (342)
3 (118) (10) (323)
----------------------------------------------- ---------- ----------------- ------------- ---------------
Total administrative expenses (4,943) (3,126) (7,609)
----------------------------------------------- ---------- ----------------- ------------- ---------------
Operating profit 3 3,290 3,012 5,491
----------------------------------------------- ---------- ----------------- ------------- ---------------
Financial income - 33 22
Financial expenses (223) (96) (233)
----------------------------------------------- ---------- ----------------- ------------- ---------------
Net financing costs (223) (63) (211)
----------------------------------------------- ---------- ----------------- ------------- ---------------
Profit from continuing operations
before tax 3 3,067 2,949 5,280
Taxation 4 (521) (542) (1,057)
----------------------------------------------- ---------- ----------------- ------------- ---------------
Profit from continuing operations 2,546 2,407 4,223
----------------------------------------------- ---------- ----------------- ------------- ---------------
Loss from discontinued operations,
net of tax - (73) (131)
----------------------------------------------- ---------- ----------------- ------------- ---------------
Profit for the period attributable
to the owners of the parent 2,546 2,334 4,092
----------------------------------------------- ---------- ----------------- ------------- ---------------
Earnings per share
Basic earnings/(loss) per share
Continuing operations 5.91p 5.62p 9.85p
Discontinued operations - (0.17p) (0.31p)
----------------------------------------------- ---------- ----------------- ------------- ---------------
Basic earnings per share 6 5.91p 5.45p 9.54p
----------------------------------------------- ---------- ----------------- ------------- ---------------
Diluted earnings/(loss) per share
Continuing operations 5.86p 5.45p 9.73p
Discontinued operations - (0.17p) (0.30p)
----------------------------------------------- ---------- ----------------- ------------- ---------------
Diluted earnings per share 6 5.86p 5.38p 9.43p
----------------------------------------------- ---------- ----------------- ------------- ---------------
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHSED 30 JUNE 2016
-----------------------------------------------------------------------------------------------
Unaudited Unaudited Audited
Six months Six months Year ended
ended 30 June ended 30 31 December
2016 June 2015
GBP000 2015 GBP000
GBP000
------------------------------------------------- --------------- ------------ -------------
Profit for the period 2,546 2,334 4,092
Other comprehensive income/ (expense)
- items that will be reclassified subsequently
to profit or loss
Exchange differences on translating foreign
operations 302 (95) 85
------------------------------------------------- --------------- ------------ -------------
Total comprehensive income in the period
attributable to the owners of the parent 2,848 2,239 4,177
------------------------------------------------- --------------- ------------ -------------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2016
---------------------------------------------------------------------------------------
Unaudited Unaudited Audited
30 June 30 June 31 December
2016 2015 2015
GBP000 GBP000 GBP000
---------------------------------------- ---- ----------- ----------- -------------
Assets
Non-current assets
Goodwill 48,312 44,962 46,412
Other intangible assets 4,889 3,342 4,179
Property, plant and equipment 3,702 3,014 3,265
Total non-current assets 56,903 51,318 53,856
---------------------------------------------- ----------- ----------- -------------
Current assets
Inventories 16,752 10,466 13,254
Trade and other receivables 14,718 11,601 10,367
Prepayments 725 224 316
Other financial assets 32 31 32
Cash and cash equivalents 1,711 784 1,841
---------------------------------------------- ----------- ----------- -------------
Total current assets 33,938 23,106 25,810
---------------------------------------------- ----------- ----------- -------------
Liabilities
Current liabilities
Interest-bearing loans and borrowings 10,905 2,957 5,986
Trade and other payables 9,313 5,151 6,625
Deferred and contingent consideration 1,068 2,277 1,250
Tax payable 937 904 758
Provisions 50 63 86
Other financial liabilities 16 - 15
---------------------------------------------- ----------- ----------- -------------
Total current liabilities 22,289 11,352 14,720
---------------------------------------------- ----------- ----------- -------------
Net current assets 11,649 11,754 11,090
---------------------------------------------- ----------- ----------- -------------
Non-current liabilities
Deferred and contingent consideration 2,789 85 898
Interest-bearing loans and borrowings 4,950 5,286 4,874
Provisions 130 121 130
Deferred tax liabilities 1,042 702 901
---------------------------------------------- ----------- ----------- -------------
Total non-current liabilities 8,911 6,194 6,803
---------------------------------------------- ----------- ----------- -------------
Net assets 59,641 56,878 58,143
---------------------------------------------- ----------- ----------- -------------
Equity directly attributable to
owners of the parent
Share capital 21,539 21,414 21,539
Share premium 46,880 46,664 46,880
Share-based payment reserve 529 307 380
Merger reserve 293 293 293
Shares owned by the EBT (338) - (338)
Merger relief reserve 2,086 2,086 2,086
Currency translation reserve 209 (273) (93)
Retained losses (11,557) (13,613) (12,604)
---------------------------------------------- ----------- ----------- -------------
Total equity 59,641 56,878 58,143
---------------------------------------------- ----------- ----------- -------------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHSED 30 JUNE 2016
----------------------------------------------------------------------------------------------------------------------
Share Share Share-based Merger Merger Currency Shares Retained Total
capital premium payment reserve relief translation owned losses equity
reserve reserve reserve by EBT
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
------------------------ ------- ------- ----------- ------- -------- ----------- ------- --------- ---------
Six months ended 30
June 2015 - unaudited
------------------------ ------- ------- ----------- ------- -------- ----------- ------- --------- ---------
Balance at 1 January
2015 21,414 46,664 148 293 2,086 (178) - (14,521) 55,906
Profit for the period - - - - - - - 2,334 2,334
Other comprehensive
expense - - - - - (95) - - (95)
------------------------ ------- ------- ----------- ------- -------- ----------- ------- --------- ---------
Total comprehensive
income for the period - - - - - (95) - 2,334 2,239
------------------------ ------- ------- ----------- ------- -------- ----------- ------- --------- ---------
Transaction with owners
Share-based payment
charge - - 159 - - - - - 159
Equity dividends paid
(note 5) - - - - - - - (1,426) (1,426)
------------------------ ------- ------- ----------- ------- -------- ----------- ------- --------- ---------
Total transactions with
owners - - 159 - - - - (1,426) (1,267)
------------------------ ------- ------- ----------- ------- -------- ----------- ------- --------- ---------
Balance at 30 June 2015 21,414 46,664 307 293 2,086 (273) - (13,613) 56,878
------------------------ ------- ------- ----------- ------- -------- ----------- ------- --------- ---------
Year ended 31 December
2015 - audited
Balance at 1 January
2015 21,414 46,664 148 293 2,086 (178) - (14,521) 55,906
Profit for the year - - - - - - - 4,092 4,092
Other comprehensive
expense - - - - 85 - - 85
Total comprehensive
income for the year - - - - - 85 - 4,092 4,177
Transaction with owners
Issue of share capital 125 216 - - - - - - 341
Shares owned by the
EBT - - - - - - (338) - (338)
Share-based payment
charge - - 342 - - - - - 342
Share options settled - - (110) - - - - - (110)
Equity dividends paid
(note 5) - - - - - - - (2,175) (2,175)
Total transactions with
owners 125 216 232 - - - (338) (2,175) (1,940)
Balance at 31 December
2015 21,539 46,880 380 293 2,086 (93) (338) (12,604) 58,143
Six months ended 30
June 2016 - unaudited
------------------------ ------- ------- ----------- ------- -------- ----------- ------- --------- ---------
Balance at 1 January
2016 21,539 46,880 380 293 2,086 (93) (338) (12,604) 58,143
Profit for the period - - - - - - - 2,546 2,546
Other comprehensive
income - - - - - 302 - - 302
------------------------ ------- ------- ----------- ------- -------- ----------- ------- --------- ---------
Total comprehensive
income for the period - - - - - 302 - 2,546 2,848
------------------------ ------- ------- ----------- ------- -------- ----------- ------- --------- ---------
Transaction with owners
Share-based payment
charge - - 149 - - - - - 149
Equity dividends paid
(note 5) - - - - - - - (1,499) (1,499)
------------------------ ------- ------- ----------- ------- -------- ----------- ------- --------- ---------
Total transactions with
owners - - 149 - - - - (1,499) (1,350)
------------------------ ------- ------- ----------- ------- -------- ----------- ------- --------- ---------
Balance at 30 June 2016 21,539 46,880 529 293 2,086 209 (338) (11,557) 59,641
------------------------ ------- ------- ----------- ------- -------- ----------- ------- --------- ---------
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHSED 30 JUNE 2016
---------------------------------------------------------------------------------------------
Unaudited Unaudited Audited
Note Six months Six months Year ended
ended ended 31 December
30 June 30 June 2015
2016 2015 GBP000
GBP000 GBP000
Cash flow from operating activities
Net cash from operating activities 9 188 1,659 5,943
----------------------------------------- ------- ------------ ------------ -------------
Cash flow from investing activities
Acquisition of subsidiary, net
of cash acquired (3,309) (477) (3,063)
Acquisition of property, plant
and equipment (353) (351) (750)
Proceeds from sale of property,
plant and equipment 22 7 7
Payment of deferred consideration - - (1,603)
----------------------------------------- ------- ------------ ------------ -------------
Net cash used in investing activities (3,640) (821) (5,409)
Cash flows from financing activities
Proceeds from new loan - - 6,523
Repayment of long term borrowings - (430) (2,357)
Net change in short term borrowings 5,000 (269) (2,096)
Repayment of finance lease liabilities (18) (11) (32)
Cash settled share options - (12) (105)
Purchase of own shares - - (338)
Interest received - - 14
Interest paid (110) (99) (244)
Dividends paid (1,499) (1,426) (2,175)
----------------------------------------- ------- ------------ ------------ -------------
Net cash generated from/ (used
in) financing activities 3,373 (2,247) (810)
----------------------------------------- ------- ------------ ------------ -------------
Net change in cash and cash equivalents (79) (1,409) (276)
Cash and cash equivalents at start
of period 1,725 1,979 1,979
Exchange differences on cash and
cash equivalents 54 (50) 22
----------------------------------------- ------- ------------ ------------ -------------
Cash and cash equivalents at end
of period 1,700 520 1,725
----------------------------------------- ------- ------------ ------------ -------------
Cash and cash equivalents 1,711 784 1,841
----------------------------------- ------ ------ ------
Bank overdraft (11) (264) (116)
----------------------------------- ------ ------ ------
Cash and cash equivalents at end
of period 1,700 520 1,725
----------------------------------- ------ ------ ------
NOTES TO THE HALF-YEAR REPORT
FOR THE SIX MONTHSED 30 JUNE 2016
------------------------------------------------------------------------------------------
1. General information
------------ ----------------------------------------------------------------------------
The principal activity of Flowtech Fluidpower plc (the "Company") and
its subsidiaries (together, the "Group") is the distribution of engineering
components, concentrating on the fluid power industry. The Company is
incorporated and domiciled in the UK. The address of its registered office
is Pimbo Road, Skelmersdale, Lancashire WN8 9RB. The registered number
is 09010518.
As permitted, this Interim Report has been prepared in accordance with
the AIM rules and not in accordance with IAS 34 "Interim Financial Reporting".
The consolidated financial statements are prepared under the historical
cost convention, as modified by the revaluation of certain financial
instruments.
This consolidated Interim Report and the financial information for the
six months ended 30 June 2016 does not constitute full statutory accounts
within the meaning of section 434 of the Companies Act 2006 and are unaudited.
This unaudited Interim Report was approved by the Board of Directors
on 12 September 2016.
The Group's financial statements for the year ended 31 December 2015
have been filed with the Registrar of Companies. The Group's auditor's
report on these financial statements was unqualified and did not contain
a statement under section 498 (2) or (3) of the Companies Act 2006.
ELECTRONIC COMMUNICATIONS
The Company is not proposing to bulk print and distribute hard copies
of this Interim Report for the six months ended 30 June 2016 unless specifically
requested by individual shareholders.
The Board believes that by utilising electronic communication it delivers
savings to the Company in terms of administration, printing and postage,
and environmental benefits through reduced consumption of paper and inks,
as well as speeding up the provision of information to shareholders.
News updates, Regulatory News, and Financial statements, can be viewed
and downloaded from the Group's website, www.flowtechfluidpower.com.
Copies can also be requested from; The Company Secretary, Flowtech Fluidpower
plc, Pimbo Road, Skelmersdale, Lancashire, WN8 9RB. email: info@flowtechfluidpower.com
2 aCCOUNTING POLICIES
-------- --------------------------------------------------------------------------
Basis of preparation
The financial information set out in this consolidated Interim Report
has been prepared under International Financial Reporting Standards (IFRS)
as adopted by the European Union and in accordance with the accounting
policies which will be adopted in presenting the Group's Annual Report
and Financial Statements for the year ended 31 December 2016. These are
consistent with the accounting policies used in the Financial Statements
for the year ended 31 December 2015, except for taxes; taxes on income
in the interim periods are accrued using the rate of tax that would be
applicable to expected total annual earnings.
GOING CONCERN
The Group meets it day-to-day working capital requirements through its
bank facilities. The Directors have carefully considered the banking
facilities and their future covenant compliance in light of the current
and future cash flow forecasts and they believe that the Group is appropriately
positioned to ensure the conditions of its funding will continue to be
met and therefore enable the Group to continue in operational existence
for the foreseeable future by meeting its liabilities as they fall due
for payment.
3. OPERATING SEGMENTS
-------------- ------------------------------------------------------------------------------------
The Group comprises of the following three operating segments which are
defined by geographic area and trading activity:
* Flowtechnology Division
distribution and assembly of engineering components, principally to distributors
and end users, split geographically between the UK and Europe
* Power Motion Control Division
distribution and assembly of engineering components and hydraulic systems
to distributors and end users in the international market - based in
the UK and Republic of Ireland
* Process Division
the distribution of industrial components to the process sectors - based
in the West Midlands
The Board is considered to be the chief operating decision maker (CODM).
The CODM manages the business using an underlying profit figure. Only
finance income and costs secured on the assets of the operating segment
are included in the segment results. Finance income and costs relating
to loans held by the Company are not included in the segment result that
is assessed by the CODM. Transfer prices between operating segments are
on an arm's length basis.
The Directors believe that the underlying operating profit provides additional
useful information on underlying trends to Shareholders. The term "underlying"
is not a defined term under IFRS and may not be comparable with similarly
titled profit measurements reported by other companies. A reconciliation
of the underlying operating result to operating profit / (loss) from
continuing operations is shown below. The principal adjustments made
are in respect of the separately disclosed items are as detailed at the
end of this note. Segment information for the reporting periods is as
follows:
Power Total
Motion Inter-segmental Central Continuing
Flowtechnology Control Process transactions Costs Operations
-------------------------------- ------------------ --------- --------- ---------------- ---------- ------------
UK Europe
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Six months ended 30 June
2016
Income statement - continuing
operations:
Revenue from external
customers 16,011 2,082 8,268 1,026 - - 27,387
Inter segment revenue 782 77 327 24 (1,210) - -
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Total revenue 16,793 2,159 8,595 1,050 (1,210) - 27,387
--------------------------------
Underlying operating result 3,941 223 930 150 - (1,185) 4,059
Net financing costs (92) - (1) 5 - (135) (223)
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Underlying segment result 3,849 223 929 155 - (1,320) 3,836
Separately disclosed items (127) (11) (27) (37) - (567) (769)
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Profit/(loss) before tax 3,722 212 902 118 - (1,887) 3,067
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Specific disclosure items
Depreciation 181 14 55 8 - - 258
Amortisation 6 - 236 22 - - 264
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Reconciliation of underlying
operating result to operating
profit:
Underlying operating result
Separately disclosed items 3,941 223 930 150 - (1,185) 4,059
(127) (11) (27) (37) - (568) (769)
--------------------------------
Operating profit/(loss) 3,814 212 903 113 - (1,753) 3,290
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Power Total
Motion Inter-segmental Central Continuing
Flowtechnology Control Process transactions Costs Operations
-------------------------------- ------------------ --------- --------- ---------------- ---------- ------------
UK Europe
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Six months ended 30 June
2015
Income statement - continuing
operations:
Revenue from external
customers 15,617 1,871 3,935 - - - 21,423
Inter segment revenue 430 42 138 - (610) - -
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Total revenue 16,047 1,913 4,073 - (610) - 21,423
--------------------------------
Underlying operating result 3,916 170 284 - - (966) 3,404
Net financing costs 4 - - - - (67) (63)
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Underlying segment result 3,920 170 284 - - (1,033) 3,341
Separately disclosed items (47) (12) (172) - - (161) (392)
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Profit/(loss) before tax 3,873 158 112 - - (1,194) 2,949
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Specific disclosure items
Depreciation (184) (13) (39) - - - (236)
Amortisation - - (160) - - - (160)
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Reconciliation of underlying
operating result to operating
profit:
Underlying operating result
Separately disclosed items 3,916 170 284 - - (966) 3,404
(47) (12) (172) - - (161) (392)
--------------------------------
Operating profit/(loss) 3,869 158 112 - - (1,127) 3,012
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Power Total
Motion Inter-segmental Central Continuing
Flowtechnology Control Process transactions Costs Operations
-------------------------------- ------------------ --------- --------- ---------------- ---------- ------------
UK Europe
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Year ended 31 December
2015
Income statement - continuing
operations:
Revenue from external
customers 29,439 3,729 11,680 - - - 44,848
Inter segment revenue 860 99 231 - (1,190) - -
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Total revenue 30,299 3,828 11,911 - (1,190) - 44,848
--------------------------------
Underlying operating result 7,169 402 1,228 - - (1,931) 6,868
Net financing costs (65) - 3 - - (149) (211)
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Underlying segment result 7,104 402 1,231 - - (2,080) 6,657
Separately disclosed items (144) (22) (505) - - (706) (1,377)
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Profit/(loss) before tax 6,960 380 726 - - (2,786) 5,280
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Specific disclosure items
Depreciation 389 23 93 - - - 505
Amortisation - - 413 - - - 413
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
Reconciliation of underlying
operating result to operating
profit:
Underlying operating result 7,169 402 1,228 - - (1,931) 6,868
Separately disclosed items (144) (22) (505) - - (706) (1,377)
--------------------------------
Operating profit/(loss) 7,025 380 723 - - (2,637) 5,491
-------------------------------- -------- -------- --------- --------- ---------------- ---------- ------------
SEPARATELY DISCLOSED ITEMS
* Acquisition costs relate to stamp duty, due diligence,
legal fees, bank fees and other professional costs
incurred in the acquisition of businesses
* Share-based payment costs relate to the provision
made in accordance with IFRS 2 "Share-based payment"
following the issue of share options to employees
* Restructuring costs relate to restructuring
activities of an operational nature and covers the
closure of business units, employee redundancies
within these units, continuing property costs post
closure and other onerous lease obligations
Six months Six months Year ended
ended ended 31 December
30 June 2016 30 June 2015 2015
GBP000 GBP000 GBP000
---------------------------------------- --------------- -------------- -------------
Separately disclosed items within
administration expenses:
-Acquisition costs 238 50 299
-Amortisation of acquired intangibles 264 160 413
-Share based payment costs 149 172 342
-Restructuring 118 10 323
---------------------------------------- --------------- -------------- -------------
Total separately disclosed items 769 392 1,377
---------------------------------------- --------------- -------------- -------------
4. TAXATION
----- --------------------------------------------------------------------------------------
Six months Six months Year ended
ended ended 31 December
30 June 2016 30 June 2015 2015
GBP000 GBP000 GBP000
------------------------------------------- -------------- -------------- ----------------
Current tax on income for the period
- continuing operations:
UK tax 620 618 1,231
Foreign tax - - 3
Deferred tax credit (45) (76) (101)
Adjustments in respect of prior years (54) - (76)
------------------------------------------- -------------- -------------- ----------------
Total taxation 521 542 1,057
------------------------------------------- -------------- -------------- ----------------
The taxation for the period has been calculated by applying the estimated
tax rate for the financial year ending 31 December 2016. Deferred tax
liabilities have also been adjusted to GBP1,042,000 to reflect capital
allowances in excess of depreciation and other short term timing differences.
---------------------------------------------------------------------------------------------
5. DIVIDS
---- -------------------------------------------------------------------------------
Six months Six months ended Year ended
ended 30 June 31 December
30 June 2015 2015
2016 GBP000 GBP000
GBP000
Final dividend of 3.50p (2015:
3.33p) per share 1,499 1,426 1,426
Interim dividend of 1.75p per
share - - 749
1,499 1,426 2,175
------------------------------------ ----------- ----------------- ---------------
In addition, the Directors are proposing a half-year dividend in respect
of the financial year ended 31 December 2016 of 1.84p per share which
will absorb an estimated GBP0.8 million of shareholders' funds. It will
be paid on the 25 October 2016 to Shareholders who are on the Register
of Members on 30 September 2016.
6. EARNINGS PER SHARE
---------------------------------------------------------------------------------------------------------------------------
Basic earnings/(loss) per share is calculated by dividing the earnings/(loss)
attributable to ordinary shareholders by the weighted average number of
ordinary shares outstanding during the period.
For diluted earnings/ (loss) per share the weighted average number of
ordinary shares in issue is adjusted to assume conversion of all dilutive
potential ordinary shares. The dilutive shares are those share options
granted to employees where the exercise price is less than the average
market price of the Company's ordinary shares during the period.
---------------------------------------------------------------------------------------------------------------------------
Six months ended Six months ended Year ended
30 June 2016 30 June 2015 31 December 2015
-------------------------- ------------------------------ ------------------------------- ------------------------------
Weighted Weighted Weighted
average Earnings average average
number per number Earnings number Earnings
Earnings of shares share Earnings of shares per share Earnings of shares per share
GBP000 000's Pence GBP000 000's Pence GBP000 000's Pence
-------------------------- --------- --------- -------- --------- --------- --------- -------- --------- ---------
Basic earnings/(loss)
per share
Continuing operations 2,546 43,078 5.91 2,407 42,828 5.62 4,223 42,869 9.85
Discontinued operations - 43,078 0.00 (73) 42,828 (0.17) (131) 42,869 (0.31)
-------------------------- --------- --------- -------- --------- --------- --------- -------- --------- ---------
Basic earnings per
share 2,546 43,078 5.91 2,334 42,828 5.45 4,092 42,869 9.54
-------------------------- --------- --------- -------- --------- --------- --------- -------- --------- ---------
Diluted earnings/(loss)
per share
Continuing operations 2,546 43,472 5.86 2,407 43,413 5.54 4,223 43,387 9.73
Discontinued operations - 43,472 0.00 (73) 43,413 (0.17) (131) 43,387 (0.30)
-------------------------- --------- --------- -------- --------- --------- --------- -------- --------- ---------
Diluted earnings per
share 2,546 43,472 5.86 2,334 43,413 5.38 4,092 43,387 9.43
-------------------------- --------- --------- -------- --------- --------- --------- -------- --------- ---------
Six months Six months Year ended
ended ended 31 December
30 June 2016 30 June 2015 2015
GBP000 GBP000 GBP000
-------------------------------------------- -------------- -------------- -------------
Weighted average number of ordinary shares
for basic and diluted earnings per share
Impact of share options 43,078 42,828 42,869
394 585 518
-------------------------------------------- -------------- -------------- -------------
Weighted average number of ordinary shares
for diluted earnings per share 43,472 43,413 43,387
-------------------------------------------- -------------- -------------- -------------
7. ACQUISITIONS
---- --------------------------------------------------------------------------------------------------
7.1 INDEQUIP
On 19 February 2016, the Group acquired 100% of the trade and certain
assets of Indequip, a UK-based business. The acquisition was made to enhance
the Group's position in the pneumatic market and bring new customers to
the Group. The total consideration was GBP893,000 and was paid in cash.
GOODWILL
Goodwill of GBP345,000 is primarily related to expected future profitability
and expected cost synergies. Goodwill has been allocated to the Flowtechnology
operating segment and is not expected to be deductible for tax purposes.
INTANGIBLE ASSET
An intangible asset of GBP96,000 has been provisionally identified related
to the brand identity of Indequip. The estimated useful life has been
determined as five years based on the expected future cash flows that
it would generate in arriving at their fair value. The components of the
brand considered in the valuation comprised the website, catalogue and
awareness of brand in the industry. Sales growth over the five-year period
has been assumed to be 1% with an attrition rate of 3% for customers.
Growth and attrition rates are based on management experience and expectations.
Amortisation of the brand is not expected to be deductible for tax purposes.
Details of the provisional fair value of identifiable assets and liabilities
acquired, purchase consideration, goodwill and intangible assets are as
follows:
--------------------------------------------------------------------------------------------------------
Intangible
Fair value asset recognised Provisional
Book value adjustment on acquisition fair value
GBP000 GBP000 GBP000 GBP000
-------------------------------------- ------------- ------------- ------------------ --------------
Property, plant and equipment 68 - - 68
Intangible assets - - 96 96
Inventories 392 - - 392
Trade and other receivables 11 - - 11
Deferred tax liability - - (19) (19)
-------------------------------------- ------------- ------------- ------------------ --------------
Total net assets 471 - 77 548
-------------------------------------- ------------- ------------- ------------------ --------------
GBP000
-------------------------------------- ------------- ------------- ------------------ --------------
Fair value of consideration paid
Amount settled in cash 893
Total consideration 893
-------------------------------------- ------------- ------------- ------------------ --------------
Less net assets acquired (548)
-------------------------------------- ------------- ------------- ------------------ --------------
Goodwill on acquisition 345
-------------------------------------- ------------- ------------- ------------------ --------------
7.2 HYDRAVALVE
On 18 March 2016, the Group acquired 100% of the share capital of Hydravalve
Limited, a UK-based business, thereby obtaining control. The acquisition
was made to establish the Group's position in the process market. The
total consideration was GBP3,814,000. This comprised GBP2,105,000 in cash
and GBP1,709,000 contingent cash consideration. The additional consideration
is based on profit targets for the Company's customer base and is payable
on the first and second anniversaries of the acquisition. The fair value
of GBP1,709,000 has been calculated using management forecasts of Hydravalve's
Limited's performance discounted at the weighted average cost of capital.
GOODWILL
Goodwill of GBP1,551,000 is primarily related to expected future profitability
and expected cost synergies. Goodwill has been allocated to the Process
operating segment and is not expected to be deductible for tax purposes.
INTANGIBLE ASSET
An intangible asset of GBP879,000 has been provisionally identified related
to customer relationships. The estimated useful life has been determined
as ten years based on the expected future cash flows that they would generate
in arriving at their fair value. The customer relationships considered
in the valuation comprise the sales to significant customers. Long term
sales growth over the ten-year period has been assumed to be 1.0% with
an attrition rate of 7.5% for customers. Growth and attrition rates are
based on management experience and expectations. Amortisation of customer
relationships is not expected to be deductible for tax purposes.
Details of the provisional fair value of identifiable assets and liabilities
acquired, purchase consideration, goodwill and intangible assets are as
follows:
----------------------------------------------------------------------------------------------------------
Intangible
Fair value asset recognised Provisional
Book value adjustment on acquisition fair value
GBP000 GBP000 GBP000 GBP000
---------------------------------------- ------------- ------------- ------------------ --------------
Property, plant and equipment 228 - - 228
Intangible assets - - 879 879
Inventories 1,635 - - 1,635
Trade and other receivables 942 - - 942
Cash and cash equivalents (312) - - (312)
Trade and other payables (605) - - (605)
Finance leases (71) (71)
Current tax balances (216) - - (216)
Deferred tax liability (41) - (176) (217)
---------------------------------------- ------------- ------------- ------------------ --------------
Total net assets 1,560 - 703 2,263
---------------------------------------- ------------- ------------- ------------------ --------------
GBP000
---------------------------------------- ------------- ------------- ------------------ --------------
Fair value of consideration paid
Amount settled in cash 2,105
Fair value of contingent consideration 1,709
---------------------------------------- ------------- ------------- ------------------ --------------
Total consideration 3,814
---------------------------------------- ------------- ------------- ------------------ --------------
Less net assets acquired (2,263)
---------------------------------------- ------------- ------------- ------------------ --------------
Goodwill on acquisition 1,551
---------------------------------------- ------------- ------------- ------------------ --------------
8. SUBSEQUENT EVENTS
-------------------------------------------------------------------------------------
Triplesix Limited ("TSL") was acquired on 29 July 2016 for a total consideration
of GBP1.1m comprising GBP0.45m in cash and GBP0.65m contingent cash consideration.
This is a provisional figure subject to the finalisation of the completion
accounts. Contingent consideration is based on the profitability of the
company post acquisition. The acquisition was made to enhance the Group's
position in the hydraulic cylinder market. Included within the net assets
of TSL was GBP0.4m of cash retained within the business on acquisition.
The cash consideration was funded out of existing cash resources.
The Group will disclose the book value of the identifiable assets and
liabilities and their fair values in the 2016 full year financial statements
as required under IFRS 3 "Business Combinations". The initial accounting
and fair value exercise is incomplete at the time of this announcement
due to the proximity of the accounting date.
9. NET CASH FROM OPERATING ACTIVITIES
----- -----------------------------------------------------------------------------------------
Six months Six months Year
ended ended ended
30 June 2016 30 June 2015 31 December
GBP000 GBP000 2015
GBP000
------------------------------------------------- -------------- -------------- -------------
Reconciliation of profit before taxation
to net cash flows from operations:
Profit from continuing operations before
tax
Loss from discontinued operations before
tax 3,067 2,949 5,280
Depreciation - (73) (131)
Financial income 258 236 505
Financial expense - (33) (22)
Profit on sale of plant and equipment 223 96 232
Amortisation (8) - (7)
Equity settled share-based payment charge 264 160 413
149 172 342
------------------------------------------------- -------------- -------------- -------------
Operating cash inflow before changes
in working capital and provisions 3,953 3,507 6,612
Change in trade and other receivables (3,696) (1,720) 1,628
Change in stocks (1,299) 1,068 (688)
Change in trade and other payables 1,915 (499) (136)
Change in provisions (36) (48) (60)
------------------------------------------------- -------------- -------------- -------------
Cash generated from operations 837 2,308 7,356
Tax paid (649) (649) (1,413)
------------------------------------------------- -------------- -------------- -------------
Net cash generated from operating activities 188 1,659 5,943
------------------------------------------------- -------------- -------------- -------------
10. TOTAL VOTING RIGHTS
-----------------------------------------------------------------------------
For the purposes of the Disclosure and Transparency Rules, the Company's
total issued share capital at the date of this announcement is 43,078,282
ordinary shares of GBP0.50 each. The total number of voting rights in
the Company is therefore 43,078,282. There are no ordinary shares held
in Treasury. This figure may be used by shareholders as the denominator
for the calculations by which they will determine if they are required
to notify their interest in, or a change to their interest in, the Company,
under the FCA's Disclosure and Transparency Rules.
PRINCIPAL RISKS AND UNCERTAINTIES
-------------------------------------------------------------------------------
In common with all organisations, Flowtech faces risks which may affect
its performance. The Group operates a system of internal control and risk
management in order to provide assurance that we are managing risk whilst
achieving our business objectives. No system can fully eliminate risk
and therefore the understanding of operational risk is central to management
processes. The long term success of the Group depends on the continual
review, assessment and control of the key business risks it faces. The
Directors set out in the 2015 Annual Report and Financial Statements the
principal risks identified during this exercise, including quality control,
systems and site disruption and employee retention. The Board does not
consider that these risks have changed materially in the last six months.
FORWARD-LOOKING STATEMENTS
This document contains certain forward-looking statements which reflect
the knowledge and information available to the Company during the preparation
and up to the publication of this document. By their very nature, these
statements depend upon circumstances and relate to events that may occur
in the future thereby involving a degree of uncertainty. Although the Group
believes that the expectations reflected in these statements are reasonable,
it can give no assurance that these expectations will prove to have been
correct. Given that these statements involve risks and uncertainties, actual
results may differ materially from those expressed or implied by these
forward-looking statements.
The Group undertakes no obligation to update any forward-looking statements
whether as a result of new information, future events or otherwise.
-------------------------------------------------------------------------------
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR LFFFIADIFLIR
(END) Dow Jones Newswires
September 13, 2016 02:01 ET (06:01 GMT)
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