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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Sinclair Will. | LSE:SNCL | London | Ordinary Share | GB0009665661 | ORD 25P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 9.375 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From May 2019 to May 2024
TIDMSNCL
RNS Number : 5699C
Sinclair (William) Holdings PLC
20 January 2015
WILLIAM SINCLAIR HOLDINGS PLC
("William Sinclair", the "Company" or the "Group")
Audited Preliminary Results for the 12 months ended 30 September 2014
William Sinclair Holdings PLC is the most technically advanced manufacturer of growing media in the UK horticulture market. Customers include The Garden Centre Group, B&Q, Tesco, Wilkinson and Morrisons as well as a large number of independent garden centres and garden centre groups.
Operational Highlights
-- Commencement of operations at new 50 acre site at Ellesmere Port -- Installation of state of the art screening, mixing and bagging facility -- Improved product quality -- Healthy stocks of harvested peat to meet customer demand
-- Significant upgrade to quality and volumes of SuperFyba reducing dependence on future peat harvest
-- Restructured sales capability, significant investment in key brands and new products -- Cessation of operations at Bolton Fell, Gainsborough and Knottingley -- Settlement with Natural England
Financial Highlights
-- Revenue GBP46.2 million (2013: GBP46.5 million) -- Profit before tax GBP1.95 million (2013: loss before tax GBP1.67 million) -- Underlying EBITDA loss GBP0.85 million (2013: profit GBP1.78 million) -- GBP12.25 million final payment from Natural England (total compensation: GBP21.25 million) -- GBP8.24 million raised to maintain development of Ellesmere Port -- Net debt to bank GBP3.4 million (2013: GBP9.6 million) -- Loan notes balance GBP8.7 million (2013: nil)
Peter Rush, Chief Executive, William Sinclair Holdings PLC, said:
"The substantial part of the GBP25 million investment at Ellesmere Port is complete and we now consider William Sinclair to be the most technically advanced manufacturer in the UK in terms of production capacity, consistency and efficiency. Ellesmere Port will drive our strategy of seeking to increase our share of the growing media market and capitalising on some of our leading brands.
"Solid foundations have now been built. Further investment and activity will be required to complete the modernisation strategy. However, the re-launch and promotion of our key brands have resulted in positive reactions from our customers against a backdrop of competitive market conditions. Together with the restructured sales force the Company intends to rebuild sales lost during the disruption caused by Ellesmere Port's development.
"William Sinclair has changed significantly during the year and we can begin to look forward to benefiting from the strengths and opportunities the Company has created."
For further information:
William Sinclair Holdings PLC Tel: 01522 537 561
Peter Rush, Chief Executive
Peter Williams, Finance Director
WH Ireland
Andrew Kitchingman Tel: 0113 394 6600
Paul Shackleton
Liam Gribben
CHAIRMAN'S STATEMENT
During the year William Sinclair continued its strategy of creating the most advanced manufacturing site in the UK horticulture industry at Ellesmere Port.
The results to 30th September 2014 were disappointing, with an underlying EBITDA loss of GBP0.85 million on turnover of GBP46.2 million, a slight reduction on the previous year. At the same time there was a considerable level of exceptional costs (which are outlined in the Strategic Report), offset by the proceeds from the claim against Natural England regarding our peat bog assets at Bolton Fell. Underlying EBITDA is defined as operating profit before exceptional items, interest, depreciation and amortisation.
As a result of the very significant level of capital expenditure in the year and the lack of a settlement with Natural England at the time, the Company raised just over GBP8 million in convertible loan notes in December 2013.
The market has been competitive, we have suffered from some historic quality issues and we have been distracted by the negotiations with Natural England and the time and energy absorbed in relocating various elements of production. Overall, although gaining business from The Garden Centre Group we lost business elsewhere.
The major achievements at Ellesmere Port during the year were the transfer of the Silvaperl operations from Gainsborough, the very significant upgrade to the SuperFyba operations and the installation of the new screening, mixing and bagging facility following the closure of the Bolton Fell operations.
Each one represented a considerable challenge and they have all been achieved but each caused an element of disruption to production and to the smooth running of the business. Some of these issues were caused by installation and commissioning of plant and some were caused by the fact that Ellesmere Port is effectively a start up site with a new team needing to become familiar with operating practices and procedures. We are beginning to see some of the benefits of concentrating more operations onto one site and this will increase once more volume is going through the site and once stable operations allow for continuous improvement.
Following the installation of the growing media line at Ellesmere Port with its enhanced screening and mixing capability, and subsequent improvements to protect peat stocks from the weather, we believe our product quality is better than ever. We will look to improve our customer service levels by working more closely with our haulage partners. Combined with our high product quality this should enable us, over time, to recover much of the professional business lost in recent years and make increased inroads into the retail sector.
During the very significant upgrade to the SuperFyba operations, which was delayed five months by the process of having to refinance our banking facility, production was severely restricted. In addition our opportunity to use SuperFyba reduced during the late spring and summer months due to the impact of the closure of Boothby, the development of Ellesmere Port and our new product packaging. However we now have the capability to produce SuperFyba of high quality at significant volumes. We hope that the availability of a peat replacement made from recycled and reformulated green waste will provide momentum to helping achieve the UK government's voluntary 2020 peat reduction targets.
An additional benefit of the growth in SuperFyba will be considerably reduced exposure to poor peat harvests. Partly because of the increased usage of SuperFyba in our growing media for the coming selling season, we have surplus peat stocks which already provide comfort for the following selling season. In any event our peat bogs are in the best condition they have been in for years and initiatives have been taken to improve harvesting potential.
As we progress up the learning curve at Ellesmere Port, from a customer service, manufacturing and logistics viewpoint, there will inevitably be challenges. We will endeavour to achieve the best customer service possible as we work through these challenges. We remain confident that Ellesmere Port is on track to become a world class facility and will be able to provide first class customer service in the coming years.
At the same time as the very significant changes to our manufacturing operations we have streamlined our sales and marketing operations to provide more support to our key brands, J Arthur Bower, Growing Success and Deadfast.
Performance at Freeland Horticulture has been strong. All of the business lost following the completion of the Olympic site contracts has been replaced and the specialist soils business is expanding across the country. Freeland Horticulture also gained important composting contracts at their Wroot facility and are now an important supplier of raw material for SuperFyba.
As with most businesses we have a range of financial covenants with which we are obliged to comply. Our forecasts show us meeting these tests with sufficient headroom. However in the event that the ongoing transformation of the business and the bedding in of operations at Ellesmere Port should threaten that position then the Group will take various cost cutting measures to reduce its overheads and will accelerate the disposal of certain surplus properties. Our bank is aware of these options and has expressed its support.
I would like to thank all the staff within the William Sinclair Group for their very hard work over the last 12 months. I would particularly like to thank the staff at all the sites which closed in the year, in many cases working up to and through the closure and helping with the commissioning of the new equipment at Ellesmere Port. Your dedication was greatly appreciated.
I would also like to thank my predecessor Hugh Etheridge who was Chairman of the Company through a difficult period up to receipt of the Natural England monies.
The Company has changed fundamentally over the last 12 months, and now has a modern production facility, a top performing alternative to peat, a strong brand portfolio and what we believe is the best quality product on the market. These strengths will be pivotal in our efforts to regain market share and begin to rebuild sales.
Rupert King
Chairman
CHIEF EXECUTIVE'S STATEMENT
Introduction
2014 was a very challenging year for William Sinclair. However the Company's modernisation programme has continued and good progress was made with the development of Ellesmere Port.
While more work remains, the substantial part of the main investment at our GBP25 million growing media supersite at Ellesmere Port is complete.
As a result we moved closer towards our objective of transforming William Sinclair into an efficiently structured, consumer-led organisation based on leading technology, innovative brands and new product development.
As part of this process, we restructured our sales organisation into a single team and reallocated the subsequent cost savings into funding substantial new brand development and marketing activities.
We also completed the development of SuperFyba 2.0 and commenced its manufacture. With a secure supply of renewable materials, we now have the opportunity to leverage SuperFyba's full potential.
Once complete William Sinclair will have an unrivalled capacity for the mass-volume manufacture of the products our professional and retail markets demand to consistently high quality standards.
Financial Highlights
Sales for the year were down slightly at GBP46.2 million (2013: GBP46.5 million) following the loss of customers by the professional division. In addition some sales were lost during the closure of our Boothby site. An improved contribution from Freeland Horticulture resulted in group revenues remaining relatively flat.
Our pre-tax losses before exceptional items of GBP3.72 million reflected the tough trading conditions and pressure on pricing. Margins also came under pressure as costs increased, due in part to higher than normal overheads and the transportation of stock to the various manufacturing sites.
While we started to realise efficiency gains from the relocation of some of our operations to Ellesmere Port, the Group's underlying EBITDA loss for the year was GBP0.85 million.
We had a number of exceptional items in the year the net impact of which was a gain of GBP5.7 million. In June we reached a resolution of the long-term claim against Natural England regarding our peat bog interests at our Bolton Fell site. An overall sum of GBP21.25 million was agreed and the balance of GBP12.25 million was received in July 2014 following the receipt of an initial GBP9 million in April 2010. The settlement has been accounted for in full in the year giving rise to a gain of GBP9.5 million.
To maintain our investment in new equipment at Ellesmere Port we needed to raise additional capital. We successfully raised GBP8.24 million through the issue of secured redeemable convertible loan notes, mainly to existing shareholders in the Company. At the same time we also refinanced our GBP25 million banking requirements to an asset based facility provider. This type of finance is well suited to support the seasonal nature of our operations. This process incurred exceptional costs of GBP1.4 million.
Other exceptionals of GBP1.3 million were incurred by the dual running costs of our Boothby site, prior to its closure.
Finally, our SuperFyba peat free product went through a major phase of improvement work. However this process temporarily interrupted SuperFyba's production leading to an under recovery of costs and a further exceptional item of GBP0.9 million.
Net debt due to our bank reduced by GBP6.2 million to GBP3.4 million. In addition the Company has loan note debt of GBP8.7 million at the year end including rolled up interest.
Reflecting the capital investment still required to complete the development of Ellesmere Port and the poor trading result, the Board has decided not to pay a dividend.
Operational Highlights
Production at our new 50-acre commercial, technical, operational and logistical centre of excellence at Ellesmere Port began in September 2014 signalling a new era for the UK's wider horticultural industry. Following the installation of new growing media plant (screening, mixing and bagging equipment) we are now the most technically advanced manufacturer in the UK in terms of production capacity and consistency.
The new site has the potential to increase capacity over the next two years, and is already home to the manufacture of our Silvaperl, Growing Media and SuperFyba product groups.
The move of Silvaperl production from our Gainsborough manufacturing site is providing the efficiency gains that we expect to make across all product groups and as volumes increase further economies of scale will be generated.
Ellesmere Port is also now home to all production of our SuperFyba 2.0 peat alternative, which we launched in September 2014. SuperFyba 2.0 gives us a major opportunity to produce growing media products containing significantly reduced levels of peat of comparable quality and costed at the same level as peat. Critically, we now have a fully secure and sustainable supply of materials, aided by our own green compost site at Wroot near Doncaster.
This improved version of our original product is already a key ingredient in many of our retail compost products and is currently being blended with peat to produce a new high performance multipurpose growing media for 2015.
In independent trials this outperformed a 100% peat product and equivalent multipurpose products from leading competitors.
While the development of SuperFyba 2.0 is highly significant, we also made major investments in draining and improving our Scottish mosses.
This work has improved the harvesting potential of high-quality professional and retail peat and following a satisfactory peat harvest, we have sufficient high quality peat stocks for the 2015 season, and some additional product remaining for 2016.
Recent expenditure in both of these areas is now complete and the combination of our improved Scottish resources and SuperFyba 2.0 production capabilities means we now have healthy levels of peat and peat alternative resources.
Freeland Horticulture - Specialist Soils Division
Freeland Horticulture ("Freeland") recovered well, replacing the Olympic Park contracts with new sales off the back of the continued improvement of the construction sector. With its depth of specialist soil knowledge Freeland will continue targeting the landscaping sector nationwide.
Freeland also has a growing focus on developing its composting business. Its composting site at Wroot has become one of the largest in the country with composting volumes growing over 50% during 2014.
During the processing of green waste on behalf of nearby councils, the Wroot operation has the extra benefit of creating green compost which is high in plant nutrients. This is used by Freeland in the make up of its own specialist soils.
Wroot also creates oversize (composted wood) thereby guaranteeing the supply of quality raw material for the manufacture of SuperFyba 2.0.
With a proven ability to run composting operations efficiently Freeland is looking to grow this side of its business, both organically or by potential acquisitions.
Sales Growth
During the year we appointed several new members of our senior management team, each with a proven record of success and expertise in our sector.
By bringing together responsibility for our Professional and Retail divisions under a single director and team, we aim to promote collaboration across both of our key product groups.
The programme of investment in brand development, now complete, has consolidated and repositioned our brands into six key category groups, including J Arthur Bower, Growing Success and Deadfast. While this streamlining has caused some disruption to our sales effort in the market we believe that our offer is now more compelling to the major retail groups.
Our brand and marketing decisions will increasingly be based on having greater in-depth understanding of our customers and is now central to the new more consumer-focused culture we are creating.
William Sinclair Staff
As part of the agreement with Natural England, William Sinclair has now ceased the majority of its operations at Boothby. I would like to thank all of our Boothby staff there for their significant efforts and co-operation, both during the period of negotiation with Natural England and during the site's closure.
I would also like to thank the staff located at Gainsborough and Knottingley for their hard work, loyalty and co-operation during the closures of these manufacturing sites, and to the staff at Wroot during the relocation of its SuperFyba operation to Ellesmere Port.
Outlook
We anticipate that the growing media market will remain highly competitive and that pressure on pricing will continue. However, the capacity and efficiencies generated by Ellesmere Port will drive our strategy of seeking to increase our share of the growing media market and capitalising on some of our leading brands.
Our growing media ambition is to be the most technically advanced and efficient manufacturer of consumer-focused products. In our specialist soils division, Freeland Horticulture will continue to increase its geographical reach across the UK following the resurgence of the construction sector. Our Scottish mosses will be well maintained and receive continual investment to protect these important assets.
Our new and refreshed brands based on close consumer understanding have already received favourable feedback and will be promoted aggressively during 2015.
We are focused on building stronger relationships with our key customer groups via all available retail and wholesale channels, and promote our capability to produce consistently high quality products on a large scale basis to potential customers.
Following substantial investment, we now have the industry's most advanced production capabilities with a fully scalable peat-alternative and a line-up of re-invigorated leading brands and have a continually developing product pipeline.
There is still much further work to do and the new plant is still settling down. However while 2015 will remain a period of further consolidation and additional investment we can begin to look forward to benefiting from the Company's strengths and market opportunities we are creating.
Peter Rush
Chief Executive
WILLIAM SINCLAIR HOLDINGS PLC
Group Income Statement
for the year ended 30 September 2014
Hot Features
Premium
2013 (Restated
- Note
2014 11)
Note GBP000 GBP000
Revenue 46,206 46,479
Operating expenses (52,805) (47,438)
Other operating income 6 9,447 -
-------- --------------
Group operating profit before
exceptional items (2,825) (182)
Exceptional expenses 6 (3,774) (777)
Exceptional gains 6 9,447 -
-------- --------------
Group operating profit / (loss) 2,848 (959)
Finance income 5 3
Finance costs (416) (161)
Other finance costs (485) (549)
-------- --------------
Profit / (loss) before taxation 1,952 (1,666)
Tax credit 2,265 164
-------- --------------
Profit / (loss) / for the year 4,217 (1,502)
======== ==============
All results relate to continuing operations.
Profit / (loss) for the year is
attributable to:
Owners of the parent company 4,135 (1,461)
Minority interests 82 (41)
----- -------
4,217 (1,502)
===== =======
Profit / (loss) per share (pence)
Basic EPS for the year 424.0p (8.6)p
Diluted EPS for the year 418.3p (8.6)p
WILLIAM SINCLAIR HOLDINGS PLC
Group statement of comprehensive income
for the year ended 30 September 2014
2014 2013
(restated)
GBP000 GBP000
Profit / (loss) for the
year 4,217 (1,502)
------- ----------
Other comprehensive (expense)
/ income:
-amounts which will not
be reclassified subsequently
to the income statement
Remeasurement on defined
benefit pension plans (2,371) 1,949
Tax on items taken directly
to or transferred from
equity 510 (347)
------- ----------
Other comprehensive (expense)
/ income for the year,
net of tax (1,861) 1,602
------- ----------
Total comprehensive income
for the year 2,356 100
======= ==========
Attributable to:
Owners of the parent company 2,274 141
Minority interests 82 (41)
------- ----------
Total comprehensive income
for the year 2,356 100
======= ==========
WILLIAM SINCLAIR HOLDINGS PLC
Group and Company statement of financial position
at 30 September 2014
Group Company
2014 2013 2014 2013
GBP000 GBP000 GBP000 GBP000
Non-current assets
Property, plant and
equipment 28,156 21,234 97 115
Intangible assets 1,713 1,784 - -
Investments in subsidiaries - - 10,859 8,795
Deferred tax assets 2,937 162 24 322
------ ------ ------ -------
32,806 23,180 10,980 9,232
------ ------ ------ -------
Current assets
Inventories 9,609 11,580 - -
Trade and other receivables 8,694 10,953 6,330 13,958
Cash and cash equivalents 1,361 784 38 182
------ ------ ------ -------
19,664 23,317 6,368 14,140
------ ------ ------ -------
Assets held for sale 1,845 7,514 - -
------ ------ ------ -------
Total assets 54,315 54,011 17,348 23,372
------ ------ ------ -------
Current liabilities
Trade and other payables 9,173 9,109 418 277
Financial liabilities
- borrowings 4,774 10,373 15 16,268
Corporation tax payable 75 75 - -
------ ------ ------ -------
14,022 19,557 433 16,545
------ ------ ------ -------
Receipt from Natural
England - 9,000 - -
------ ------ ------ -------
14,022 28,557 433 16,545
------ ------ ------ -------
Non-current liabilities
Financial liabilities
- borrowings 8,718 - 8,718 -
Provisions 1,110 145 - -
Defined benefit pension
plan deficit 13,791 10,840 - -
------ ------ ------ -------
23,619 10,985 8,718 -
------ ------ ------ -------
Total liabilities 37,641 39,542 9,151 16,545
------ ------ ------ -------
Net assets 16,674 14,469 8,197 6,827
====== ====== ====== =======
WILLIAM SINCLAIR HOLDINGS PLC
Group and Company statement of financial position
at 30 September 2014 (continued)
Group Company
2014 2013 2014 2013
Note GBP000 GBP000 GBP000 GBP000
Capital and reserves
Share capital 8 4,344 4,265 4,344 4,265
Share premium account 150 150 150 150
Capital redemption
reserve 1,523 1,523 1,523 1,523
Revaluation reserve 4,050 9,035 20 20
Other reserves 176 176 86 86
Retained earnings 6,074 (955) 2,074 783
------ ------ ------ -------
Equity attributable
to owners of the parent 16,317 14,194 8,197 6,827
Minority interests 357 275 - -
------ ------ ------ -------
Total equity 16,674 14,469 8,197 6,827
====== ====== ====== =======
WILLIAM SINCLAIR HOLDINGS PLC
Group statement of changes in equity
for the year ended 30 September 2014
Share Capital
Share premium redemption Revaluation Other Retained Minority Total
capital account reserve reserve reserves earnings Total interest equity
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 1 October 2013 4,265 150 1,523 9,035 176 (955) 14,194 275 14,469
-------- -------- ----------- ----------- --------- --------- ------- --------- -------
Profit / (loss) for
the year - - - - - 4,135 4,135 82 4,217
-------- -------- ----------- ----------- --------- --------- ------- --------- -------
Other comprehensive
income:
Actuarial gains on
defined benefit
pension
plans - - - - - (2,371) (2,371) - (2,371)
Tax on items taken
directly to or
transferred
from equity - - - - - 510 510 - 510
Depreciation transfer - - - (45) - 45 - - -
Release to retained
earnings - - - (4,940) - 4,940 - - -
-------- -------- ----------- ----------- --------- --------- ------- --------- -------
Total other
comprehensive
income - - - (4,985) - 3,124 (1,861) - (1,861)
-------- -------- ----------- ----------- --------- --------- ------- --------- -------
Total comprehensive
income / (expense) - - - (4,985) - 7,259 2,274 82 2,356
-------- -------- ----------- ----------- --------- --------- ------- --------- -------
Transactions with
owners:
Equity shares issued 79 - - - - (79) - - -
Share based payments - - - - - 108 108 - 108
Equity dividends paid - - - - - (259) (259) - (259)
-------- -------- ----------- ----------- --------- --------- ------- --------- -------
Transactions with
owners 79 - - - - (230) (151) - (151)
-------- -------- ----------- ----------- --------- --------- ------- --------- -------
At 30 September 2014 4,344 150 1,523 4,050 176 6,074 16,317 357 16,674
======== ======== =========== =========== ========= ========= ======= ========= =======
WILLIAM SINCLAIR HOLDINGS PLC
Group statement of changes in equity
for the year ended 30 September 2013
Share Capital
Share premium redemption Revaluation Other Retained Minority Total
capital account reserve reserve reserves earnings Total interest equity
(restated) (restated) (restated)
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 1 October
2012 4,256 150 1,523 8,790 176 (170) 14,725 333 15,058
-------- -------- ----------- ----------- --------- ---------- ---------- --------- ----------
Loss for the
year - - - - - (1,461) (1,461) (41) (1,502)
-------- -------- ----------- ----------- --------- ---------- ---------- --------- ----------
Other
comprehensive
income:
Actuarial
gains on
defined
benefit
pension
plans - - - - - 1,949 1,949 - 1,949
Tax on items
taken
directly to
or
transferred
from equity - - - 342 - (689) (347) - (347)
Depreciation
transfer - - - (97) - 97 - - -
-------- -------- ----------- ----------- --------- ---------- ---------- --------- ----------
Total other
comprehensive
income - - - 245 - 1,357 1,602 - 1,602
-------- -------- ----------- ----------- --------- ---------- ---------- --------- ----------
Total
comprehensive
income /
(expense) - - - 245 - (104) 141 (41) 100
-------- -------- ----------- ----------- --------- ---------- ---------- --------- ----------
Transactions
with
owners:
Equity shares
issued 9 - - - - (9) - - -
Share based
payments - - - - - 120 120 - 120
Deferred tax
on share
based
payments - - - - - (93) (93) - (93)
Equity
dividends
paid - - - - - (699) (699) (17) (716)
-------- -------- ----------- ----------- --------- ---------- ---------- --------- ----------
Transactions
with
owners 9 - - - - (681) (672) (17) (689)
-------- -------- ----------- ----------- --------- ---------- ---------- --------- ----------
At 30
September
2013 4,265 150 1,523 9,035 176 (955) 14,194 275 14,469
======== ======== =========== =========== ========= ========== ========== ========= ==========
WILLIAM SINCLAIR HOLDINGS PLC
Group statement of cash flows
for the year ended 30 September 2014
2014 2013
Note GBP000 GBP000
Operating activities
Group operating profit
/ (loss) 2,848 (959)
Adjustments to reconcile
group operating loss to
net cash
inflows from operating
activities
Depreciation of property,
plant and equipment 1,808 1,793
Amortisation of intangible
assets 169 171
Impairment of assets 3,071 -
Loss / (profit) on disposal
of property, plant and
equipment 12 (110)
Share-based payments 108 120
Difference between pension
contributions paid and
amounts recognised in the
income statement 95 (964)
Decrease / (increase) in
inventories 1,971 (975)
Decrease / (increase) in
trade and other receivables 2,259 (814)
(Decrease) / increase in
trade and other payables (87) 2,071
Increase in provisions 958 8
Release of Natural England
balance (9,000) -
------- -------
Cash generated from operations 4,212 341
Income taxes received /
(paid) - 365
------- -------
Net cash flow from operating
activities 4,212 706
------- -------
Investing activities
Interest received 5 3
Sale of property, plant
and equipment 2,899 236
Purchases of property,
plant and equipment (8,384) (3,456)
Payments to acquire intangible
fixed assets (98) (57)
------- -------
Net cash flow from investing
activities (5,578) (3,274)
------- -------
Financing activities
Interest paid (363) (156)
Dividends paid to owners
of the parent 7 (259) (699)
Dividends paid to minority
interests - (17)
New borrowings 8,164 -
Repayment of borrowings (5,000) (162)
------- -------
Net cash flow from financing
activities 2,542 (1,034)
------- -------
Increase/(Decrease) in
cash and cash equivalents 1,176 (3,602)
Cash and cash equivalents
at the beginning of the
year (4,589) (987)
------- -------
Cash and cash equivalents
at the year end (3,413) (4,589)
======= =======
WILLIAM SINCLAIR HOLDINGS PLC
Notes
1 Statutory accounts
The consolidated financial statements of William Sinclair Holdings PLC are prepared on a going concern basis and in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union, International Financial Reporting Interpretations Committee (IFRIC) interpretations and Standing Interpretations Committee (SIC) interpretations as adopted by the European Union and with those parts of the Companies Act 2006 applicable to those companies reporting under IFRSs. The consolidated financial statements are prepared in accordance with the historical cost convention, as modified by the revaluation of freehold and leasehold properties.
The Group financial statements are presented in sterling and all values are rounded to the nearest thousand pounds (GBP000) except when otherwise indicated.
These results for the year to 30 September 2014 together with the corresponding amounts for the year to 30 September 2013 are extracts from the 2014 annual report and do not constitute statutory accounts within the meaning of section 434 of the Companies Act 2006.
The statutory accounts for the year ended 30 September 2014, which have been audited by PricewaterhouseCoopers LLP, incorporate an unqualified audit report and do not contain a statement under either section 498(2) or 498(3) of the Companies Act 2006.
This preliminary announcement of the results for the year ended 30 September 2014 was approved by the Board of directors on 15 January 2014.
The accounting policies used for the 2014 figures are unchanged on those used for the 2013 comparatives except in respect of IAS 19 Employee Benefits. The impact of applying the new standard to the comparative figures for the year ended 30 September 2013 is an increase in other finance costs in the Group Income Statement and in actuarial gains in the Group Statement of Comprehensive Income of GBP484,000.
The statutory accounts for the period ended 30 September 2013 have been delivered to the Registrar of Companies and the statutory accounts for the year ended 30 September 2014 will be delivered to the Registrar of Companies following the Annual General Meeting of William Sinclair Holdings PLC.
2 Analysis of net cash/(debt)
1 Oct Cash 30 Sept
2013 flow 2014
GBP000 GBP000 GBP000
Cash at bank and in hand 784 577 1,361
Overdrafts (5,373) 599 (4,774)
Bank loans (5,000) 5,000 -
Loan notes - (8,718) (8,718)
------- ------- --------
(9,589) (2,542) (12,131)
======= ======= ========
3 Assets held for sale
Included in assets held for sale at 30 September 2014 and 2013 is the Group's freehold property at Oswaldtwistle at a carrying value of GBP1,645,000. The site is being actively marketed.
Following the successful conclusion of negotiations with Natural England in July 2014 the Group's peat bog properties at Bolton Fell in Cumbria have been disposed of to Natural England. These properties were included in assets held for sale at a carrying value of GBP2,598,000. The Group retains certain property interests in the factory site at Boothby, Cumbria. The carrying value of these interests has been impaired by the cessation of peat harvesting activities on the neighboring peat bog. As a consequence an impairment charge of GBP3,071,000 has been recorded, leaving a carrying value for these assets of GBP200,000. The factory site properties are being actively marketed.
4 Earnings per share
Basic earnings per share amounts are calculated by dividing the earnings for the year attributable to owners of the parent by the weighted average number of ordinary shares outstanding during the year.
Diluted earnings per share amounts are calculated by dividing the earnings for the year attributable to owners of the parent by the weighted average number of ordinary shares outstanding during the year adjusted for the dilutive effect of share options, warrants and the convertible loan notes outstanding at the year end.
The following reflects the income and share data used in the basic and diluted earnings per share computations:
2014 2013
(restated)
GBP000 GBP000
Profit / (loss) attributable to owners
of the parent 4,135 (1,461)
Exceptional items after tax - attributable
to owners of the parent (7,230) 594
------- ----------
Loss from continuing operations before
exceptional items attributable to
owners of the parent (3,095) (867)
======= ==========
2014 2013
Number Number
Basic weighted average number of
shares ('000s) 17,211 17,049
Dilutive potential ordinary shares:
Employee share options, conversion
of loan notes and warrants ('000s) 5,818 386
------ ------
Diluted weighted average number of
shares ('000s) 23,029 17,435
====== ======
There have been no transactions involving ordinary shares or potential ordinary shares between the reporting date and the date of completion of these financial statements.
Basic and diluted earnings per share are 24.0p and 18.3p (2013 loss per share: 8.6p).
Basic loss per share before exceptional items is 18.0p (2013: loss 5.1p).
5 Segment information
Within the horticulture sector the Board reviews the results of Freeland, its specialist topsoils and SuperFyba business, and certain ancillary businesses separately from those of its core horticulture business. The revenues and operating profits of these segments are shown below together with a reconciliation to the Group results.
External Internal
sales sales Total sales
2014 2013 2014 2013 2014 2013
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Revenue
Horticulture 34,961 36,210 121 39 35,082 36,249
Freeland 7,920 6,501 282 530 8,202 7,031
Other 3,325 3,768 - - 3,325 3,768
Total 46,206 46,479 403 569 46,609 47,048
Less intra group
sales elimination - - (403) (569) (403) (569)
------ ------ ------ ------ ------ ------
Total revenue 46,206 46,479 - - 46,206 46,479
====== ====== ====== ====== ====== ======
Segment revenue includes transactions between business segments. These transactions are eliminated on consolidation. Sales between segments are carried out at arm's length. The revenue from external parties reported to the executive directors is measured in a manner consistent with that in the income statement.
During the year the Group had one customer that accounted for more than 10% of group revenues. Revenue from this customer was GBP5.4 million and was all within the Horticulture segment.
2014 2013
(restated)
GBP000 GBP000
Operating (loss) / profit before
exceptional items
Horticulture (2,357) 1,265
Freeland 827 (638)
Other 27 387
------- ----------
Total segment operating (loss) /
profit before exceptional items (1,503) 1,014
Central costs (1,322) (1,196)
------- ----------
Total group operating loss before
exceptional items (2,825) (182)
Exceptional items 5,673 (777)
------- ----------
Total group operating profit / (loss)
after exceptional items 2,848 (959)
Finance income 5 3
Finance costs (416) (161)
Other finance costs (485) (549)
------- ----------
Total group profit / (loss) before
tax 1,952 (1,666)
======= ==========
5 Segment information (continued)
Central costs include the administration costs of the holding company such as directors' remuneration, professional fees and stock exchange costs.
Operating loss as reported above includes impairment, depreciation and amortisation charges as follows:
Depreciation
Impairment and amortisation
2014 2013 2014 2013
GBP000 GBP000 GBP000 GBP000
Horticulture 3,071 - 1,687 1,472
Freeland - - 230 463
Other - - 42 15
Central costs - - 18 14
Total 3,071 - 1,977 1,964
====== ====== ========= ========
Asset and liability information is not reported to the chief operating decision maker on a segment basis and therefore has not been disclosed.
6 Exceptional items
The long running claim against Natural England in respect of the Group's peat bog interests at Bolton Fell was settled in June 2014. As a result the July 2014 receipt of GBP12.25 million, together with the April 2010 receipt of GBP9.0 million have now been taken to the Group Income Statement along with all the professional costs of the case, the additional trading costs of the Group during the transition period and all asset impairment costs resulting from the closure of the peat harvesting operations at Bolton Fell. The net credit to the Group Income Statement is GBP9,447,000. This is included in exceptional items. The tax impact of this gain is a credit of GBP727,000.
In Autumn 2013 the Group commenced a restructuring of its finances which included the issue of a new five year loan note in December 2013 and the move to an asset based lender in January 2014. The professional fees and bank charges for work carried out in the financial year amounted to GBP991,000 (2013: GBP230,000). A further exercise was carried out in Spring 2014 in advance of the Natural England settlement at a cost of GBP398,000. These costs are shown as exceptional.
Additionally the Group has incurred a range of overhead costs at its flagship Ellesmere Port site that duplicated costs necessarily incurred elsewhere in the Group and/or relate to the commencement of operations there. These dual running costs amounted to GBP1,344,000 in the year (2013: GBP369,000) and are treated as exceptional items.
The development of the SuperFyba operation at Ellesmere Port resulted in exceptional costs of GBP850,000 during the year as further new technologies were introduced in May 2014 and also when production was interrupted following the closure of the Boothby factory operation in June 2014 until the Ellesmere Port bagging facility came on line in Autumn 2014.
During the year the Group undertook a restructuring of its sales function which resulted in a number of redundancy payments. The cost of this exercise totalled GBP191,000 and this is treated as an exceptional item.
During the year ended 30 September 2013 the operation of the trading sites at Knottingley and Gainsborough were transferred to the new site at Ellesmere Port. The resulting redundancy costs of GBP178,000 were shown as exceptional.
The total of the exceptional expenses is GBP3,774,000 (2013: GBP777,000). The tax impact of the exceptional expenses is a credit of GBP830,000 (2013: 183,000).
The above items are summarised in the following table:
2014 2013
GBP000 GBP000
Exceptional gains
Natural England 9,447 -
Tax impact 727 -
------ ------
Net 10,174 -
====== ======
Exceptional expenses
Refinance costs 1,389 230
Dual running costs 1,344 369
SuperFyba 850 -
Restructuring 191 178
------ ------
3,774 777
Tax impact (830) (183)
------ ------
Net 2,944 594
====== ======
7 Dividends paid and proposed
2014 2013
GBP000 GBP000
Declared and paid during the year:
Equity dividends on ordinary shares:
Final dividend for September 2013:
1.5p (September 2012: 2.6) 259 443
Interim for September 2014: nil (September
2013 - 1.5p) - 256
------ ------
Dividends paid 259 699
====== ======
Proposed for approval by shareholders
at the AGM:
Final dividend for September 2014:
nil (2013: 1.5p) - 256
====== ======
8 Share capital
Issued and fully paid 2014 2013 2014 2013
Number Number GBP000 GBP000
Ordinary shares of 25p
each 17,377,420 17,059,046 4,344 4,265
========== ========== ====== ======
During the year 318,374 ordinary shares of 25p each were issued at nil cost under the Group's LTIP scheme. Also, the Company issued 5,665,000 warrants for ordinary shares in the Company. These warrants may be exercised at any time at a subscription price of 80p.
9 Loan Notes
On 20 December 2013 the Company raised a total of GBP8.24 million before expenses through the issue of fixed rate secured redeemable convertible loan notes to institutional and other investors, the majority of whom were existing shareholders in the Company.
The funding provided by the convertible notes has been used primarily to expedite development of the Group's Ellesmere Port manufacturing facility.
The loan notes carry a coupon of 8% together with a premium of up to 3% which reduces by 1% for each of the first three capital repayments of GBP1.0 million.
The loan notes are repayable in December 2018 or earlier at the Company's option. On repayment the loan note holders may elect to take repayment in ordinary shares of the Company at a conversion rate of GBP1.59 of debt for each ordinary share.
10 Post Balance Sheet Event
On 30 November 2014 the Group completed the transfer of its working capital facilities to Leumi ABL Ltd. The new facilities comprise debtor and inventory facilities totalling GBP26 million and amortising loans of a further GBP3 million. The working capital facilities are at 2.1% and 2.5% above Libor while the amortising loans are at 2.75% and 3.0% above Libor.
11. IAS 19 Revised
This year the Group has adopted IAS 19 Revised in respect of its pension scheme. As a consequence the Group's accounting policies is to recognise immediately all past service costs and to replace interest cost and expected return on plan assets with a net interest amount that is calculated by applying the discount rate to the net defined benefit liability. The impact of applying the new standard to the comparative figures for the year ended 30 September 2013 is an increase in other finance costs in the Group Income Statement and in actuarial gains in the Group Statement of Comprehensive Income of GBP484,000.
12 Annual General Meeting
The Company intends to post the Report and Accounts to shareholders on 9 February 2015. The Annual General Meeting of the Company will be held at noon on Friday 6 March 2015 at the Group's flagship site at Ellesmere Port when there will be an opportunity for shareholders to tour the site. The full address is William Sinclair Horticulture, Bridges Road, Ellesmere Port, Cheshire CH65 4LB.
Copies of this announcement are available from the Company's registered office which is Firth Road, Lincoln, LN6 7AH during normal office hours and on the Company's website www.william-sinclair.co.uk.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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