Share Name Share Symbol Market Type Share ISIN Share Description
CHAMBERLIN PLC NEX:CMH.GB NEX Ordinary Share GB0001870228
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  0.00 0.0% 22.50 20.00 25.00 22.50 22.50 22.50 0.00 07:42:46
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
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Chamberlin PLC Half-year Report

18/11/2019 7:00am

UK Regulatory (RNS & others)


CHAMBERLIN (NEX:CMH.GB)
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6 Months : From Aug 2019 to Feb 2020

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TIDMCMH

RNS Number : 6431T

Chamberlin PLC

18 November 2019

18 November 2019

AIM: CMH

CHAMBERLIN PLC

("Chamberlin" or "the Company" or "the Group")

Interim Results

for the six months to 30 September 2019

Key Points

-- H1 results reflect tough trading conditions and a restructuring programme to align the cost base leading to improved start to H2

   --      Revenues at GBP12.8m (2018: GBP17.4m) 

-- Operating loss before restructuring costs GBP1.0m (2018 restated: loss GBP0.4m). Operating loss after restructuring costs GBP1.7m (2018 restated: GBP0.4m)

-- Major downsizing of operations with 28% reduction in headcount, non-recurring restructuring charge of GBP0.7m

   --      Loss before tax of GBP1.8m (2018 restated: loss of GBP0.6m). 
   --      Net debt at 30 Sept 2019 at GBP6.1m (31 March: 2019 GBP5.4m) 
   --      Enhanced prospects for H2 due to new contracts and reduced cost base 

Chairman, Keith Butler-Wheelhouse, commented:

"The first half of the year has seen significant efforts going into the restructuring of the business as well as a drive to win new business. The restructuring is now, in the main, complete. Looking ahead the Board is cautiously optimistic that the lower cost base and prospective revenue gains will benefit Chamberlin over the years ahead."

Enquiries

 
Chamberlin plc                              T: 01922 707100 
 Kevin Nolan, Chief Executive 
 Neil Davies, Finance Director 
 
Cenkos Securities plc (Nominated Adviser    T: 020 7397 8900 
 and Broker) 
 Russell Cook 
 Katy Birkin 
 
KTZ Communications (Financial PR)           T: 020 3178 6378 
 Katie Tzouliadis 
 Dan Mahoney 
 

Chairman's Statement

Chamberlin plc (AIM: CMH) announces its interim results for the six months ended 30 September 2019.

Revenues in the first six months declined to GBP12.8m from GBP17.4m in the prior year, when revenues rose by 21% aided by stock-building by some automotive customers. In addition to the swing in demand from the automotive sector, in part related to the changed emissions testing regime, revenues also reflected lower demand at the Scunthorpe foundry following British Steel's administration. Some customers delayed purchasing at Petrel, partly attributable to continuing Brexit uncertainty.

Management have re-assessed the expected go-forward revenues, and have made substantial adjustments to the cost base. Compared to the turn of the calendar year the headcount has reduced by 28%.

Operating profitability in the first half, before restructuring costs of GBP0.7m, resulted in a loss of GBP1.0m (2018: loss GBP0.4m). The loss before tax was GBP1.8m, compared to the loss of GBP0.6m in the first half of the prior year.

As a consequence, net debt increased from GBP5.4m at the start of the year to GBP6.1m. Improvements to working capital and control of capital expenditure costs partly offset the cash effect of the above loss before tax. Trade debt of GBP0.9m that was overdue at the half year-end has since been received, improving the net debt position.

In addition to actions to reduce the cost base, management's negotiations with customers have substantially enhanced the outlook for the second half and future years. Contributing to these expected increased revenues are:

-- Higher volumes from existing automotive customers including increased utilisation of machining capacity achieved through improved technical support and additional filtration initiatives.

   --      A new contract for non-automotive light castings. 
   --      Selling price increases. 
   --      A new customer for heavy castings, with potentially large volumes. 
   --      New products launched at Petrel. 

Outlook

Trading in the second half reflects the new customer orders and initiatives above, and the actions taken to restructure the cost base. The combination of higher revenues and a significantly lower cost base is expected to give rise to second half operating margins of approximately 3%, with a consequent reduction in net debt. However, despite the improvement in second half trading, the Board believes that the results to 31 March 2020, excluding the restructuring cost of GBP0.7m, will move from the positive side of break-even to a small loss for the year. Looking further ahead, Management are encouraged by these initiatives, although risks remain until the post Brexit terms of trade with the EU are determined.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014

Consolidated Income Statement

for the six months ended 30 September 2019

 
 
                                                                                 Unaudited 
                                         Unaudited                            six months ended                           Year ended 
                                      six months ended                        30 September 2018                     31 March 2019 restated 
                    Note              30 September 2019                       restated (note 9)                            (note 9) 
                                                   #                                        #                                      # 
                          Underlying  Non-underlying        Total  Underlying  Non-underlying      Total  Underlying  Non-underlying         Total 
                              GBP000          GBP000       GBP000      GBP000          GBP000     GBP000      GBP000          GBP000        GBP000 
 
 Revenue              2       12,828               -       12,828      17,363               -     17,363      32,958               -        32,958 
 Cost of sales              (11,921)               -     (11,921)    (15,152)               -   (15,152)    (29,192)               -      (29,192) 
 Gross profit                    907               -          907       2,211               -      2,211       3,766               -         3,766 
 Other operating 
  expenses            7      (1,917)           (686)      (2,603)     (2,580)             (4)    (2,584)     (4,776)         (3,448)       (8,224) 
                          ----------  --------------  -----------  ----------  --------------  ---------  ----------  --------------  ------------ 
 Operating loss              (1,010)           (686)      (1,696)       (369)             (4)      (373)     (1,010)         (3,448)       (4,458) 
 Finance costs       3,7       (147)               -        (147)       (233)               -      (233)       (499)               -         (499) 
                          ----------  --------------  -----------  ----------  --------------  ---------  ----------  --------------  ------------ 
 Loss before tax             (1,157)           (686)      (1,843)       (602)             (4)      (606)     (1,509)         (3,448)       (4,957) 
 Tax 
  (expense)/credit   4,7       (143)               -        (143)         121               -        121        (39)              87            48 
                          ----------  --------------  -----------  ----------  --------------  ---------  ----------  --------------  ------------ 
 Loss for the 
  period 
  from continuing 
  operations                 (1,300)           (686)      (1,986)       (481)             (4)      (485)     (1,548)         (3,361)       (4,909) 
                    ----  ----------  --------------  -----------  ----------  --------------  ---------  ----------  --------------  ------------ 
 Discontinued 
 operations 
 Profit for the 
  period from 
  discontinued 
  operations                       -               -            -           -             221        221           -           6,435         6,435 
                    ----  ----------  --------------  -----------  ----------  --------------  ---------  ----------  --------------  ------------ 
 (Loss)/ profit 
  for the period 
  attributable to 
  equity holders 
  of the Parent 
  Company                    (1,300)           (686)      (1,986)       (481)             217      (264)     (1,548)           3,074         1,526 
                          ==========  ==============  ===========  ==========  ==============  =========  ==========  ==============  ============ 
 
 Underlying (loss) 
 per share from 
 continuing 
 operations: 
 Basic                5                                   (16.3)p                                 (6.0)p                                   (19.5)p 
 Diluted                                                  (16.3)p                                 (6.0)p                                   (19.5)p 
 Earnings per 
 share 
 from discontinued 
 operations: 
 Basic                5                                         -                                   2.8p                                     80.9p 
 Diluted                                                        -                                   2.8p                                     80.9p 
 
  Total 
  (loss)/earnings 
  per share: 
 Basic                5                                   (25.0)p                                 (3.3)p                                     19.2p 
 Diluted                                                  (25.0)p                                 (3.3)p                                     19.2p 
 

(#) Non- underlying items represent exceptional costs, share based payment costs and the associated tax impact of these items as disclosed in note 7.

Consolidated Statement of Comprehensive Income

for the six months ended 30 September 2019

 
                                         Unaudited           Unaudited 
                                        six months    six months ended 
                                             ended        30 September    Year ended 
                                      30 September       2018 restated      31 March 
                                              2019            (note 9)          2019 
                                            GBP000              GBP000        GBP000 
 
 (Loss)/profit for the 
  period                                   (1,986)               (264)         1,526 
                                    --------------  ------------------  ------------ 
 Other comprehensive 
  income 
 Reclassification of                             -                (19)             - 
  cash flow hedges included 
  in sales 
 Movements in fair value 
  of cash flow hedges 
  taken to other comprehensive 
  income                                     (165)               (139)           134 
 Deferred tax on movements 
  in cash flow hedges                           28                  26          (23) 
                                    --------------  ------------------  ------------ 
 Net other comprehensive 
  (expense)/income that 
  may be recycled to 
  profit and loss                            (137)               (132)           111 
                                    --------------  ------------------  ------------ 
 
   Re-measurement gains/ 
   (losses)on pension 
   scheme assets and liabilities             (261)                 984            76 
 Deferred/ current tax 
  on re-measurement (losses)/ 
  gains on pension assets 
  and liabilities                               50               (186)          (15) 
 Net other comprehensive 
  (expense)/ income/that 
  will not be reclassified 
  to profit and loss                         (211)                 798            61 
                                    --------------  ------------------  ------------ 
 
   Other comprehensive 
   (expense)/income for 
   the period net of tax                     (348)                 666           172 
 Total comprehensive 
  (expense)/income for 
  the period attributable 
  to equity holders of 
  the Parent Company                       (2,334)                 402         1,698 
                                    ==============  ==================  ============ 
 

Consolidated Balance Sheet

at 30 September 2019

 
                                                       Unaudited 
                                      Unaudited     30 September 
                                   30 September    2018 restated   31 March 
                                           2019         (note 9)       2019 
                                         GBP000           GBP000     GBP000 
 Non-current assets 
  Property, plant and 
   equipment                              7,714           11,143      7,769 
  Intangible assets                         264              298        290 
  Deferred tax assets                       820              945        906 
                                 --------------  ---------------  --------- 
                                          8,798           12,386      8,965 
                                 --------------  ---------------  --------- 
 Current assets 
  Assets held for sale                        -            3,140          - 
  Inventories                             2,838            2,818      2,702 
  Trade and other receivables             5,140            7,151      6,052 
  Cash at bank                              599                -        291 
                                          8,577           13,109      9,045 
                                 --------------  ---------------  --------- 
 Total assets                            17,375           25,495     18,010 
                                 ==============  ===============  ========= 
 
 Current liabilities 
  Financial liabilities                   4,159            8,734      2,683 
  Trade and other payables                5,153            6,507      4,600 
                                          9,312           15,241      7,283 
                                 --------------  ---------------  --------- 
 Non-current liabilities 
  Financial liabilities                   2,491            2,469      2,966 
  Deferred tax liabilities                   35                -         53 
  Provisions                                200              200        200 
  Defined benefit pension 
   scheme deficit                         2,791            4,023      2,640 
                                          5,517            6,692      5,859 
 
 Total liabilities                       14,829           21,933     13,142 
                                 --------------  ---------------  --------- 
 
 Capital and reserves 
  Share capital                           1,990            1,990      1,990 
  Share premium                           1,269            1,269      1,269 
  Capital redemption 
   reserve                                  109              109        109 
  Hedging reserve                          (41)            (147)         96 
  Retained earnings                       (781)              341      1,404 
                                 --------------  ---------------  --------- 
 Total equity                             2,546            3,562      4,868 
                                 --------------  ---------------  --------- 
 
 Total equity and liabilities            17,375           25,495     18,010 
                                 ==============  ===============  ========= 
 

Consolidated Cash Flow Statement

for the six months ended 30 September 2019

 
                                                                         Unaudited 
                                                   Unaudited            six months 
                                                  six months                 ended 
                                                       ended          30 September                          Year ended 
                                                30 September         2018 restated                            31 March 
                                                        2019              (note 9)                                2019 
                                                      GBP000                GBP000                              GBP000 
 Operating activities 
 Loss for the period before 
  tax                                                (1,843)                 (606)                             (4,957) 
 Adjustments for: 
 Net finance costs                                       147                   171                                 387 
 Impairment charge on property,plant 
  and equipment                                            -                     -                               3,043 
 Depreciation of property, 
  plant and equipment                                    476                   684                               1,688 
 Non-underlying items                                    686                     -                                   - 
 Amortisation of software                                 22                    28                                  59 
 Amortisation of development 
  costs                                                   11                    10                                  25 
 (Profit)/loss on disposal 
  of property plant and equipment                       (12)                     8                                   - 
 Share based payments                                      -                     4                                  40 
 Foreign exchange rate movements                        (79)                     -                                   - 
 One-off contribution to 
  defined benefit pension 
  scheme                                                   -                     -                             (2,500) 
 Difference between pension 
  contributions paid and 
  amounts recognised in the 
  Income Statement                                     (139)                  (73)                                 137 
 Increase in inventories                               (136)                 (506)                               (388) 
 Decrease/(increase) in 
  receivables                                            998                 (846)                                 419 
 Increase/(decrease) in 
  payables                                               318                   354                             (1,332) 
 Cash inflow/(outflow) from 
  continuing operations                                  449                 (772)                             (3,379) 
 Cash (outflow)/ inflow 
  from discontinued operations                             -                  (45)                                 491 
 Cash out flow from non-underlying                     (604)                     -                                   - 
  items 
 Net cash outflow from operating 
  activities                                           (155)                 (817)                             (2,888) 
 
 Investing activities 
  Purchase of property, 
   plant and equipment                                 (400)                 (464)                             (1,188) 
  Purchase of software                                   (7)                     -                                   - 
  Development costs                                        -                     -                                (22) 
  Proceeds from sale of 
   subsidiary                                              -                     -                               8,520 
  Cash and cash equivalents 
   disposed                                                -                     -                             (1,146) 
  Disposal of property,                                   12                     -                                   - 
   plant and equipment 
  Investing activities from 
   discontinued operations                                 -                  (68)                               (125) 
 Net cash (outflow)/inflow 
  from investing activities                            (395)                 (532)                               6,039 
 
 Financing activities 
  Interest paid                                        (118)                 (187)                               (387) 
  Net invoice finance drawdown/(repayment)             1,495                 2,127                             (1,832) 
  Import loan facility repayment                           -               (1,137)                               (873) 
  Finance lease payments                               (530)                  (55)                               (781) 
  Finance leases additions                                 -                   780                               1,291 
  Financing activities from 
   discontinued operations                                 -                     -                                 207 
 
   Net cash inflow/(outflow) 
   from financing activities                             847                 1,528                             (2,375) 
                                              --------------       ---------------       ----------------------------- 
 
 Net increase in cash and 
  cash equivalents                                       297                   179                                 776 
 
 
  Cash and cash equivalents 
   at the start of the period                            291                 (485)                               (485) 
   Impact of foreign exchange 
    rate movements                                        11                     -                                   - 
 
 
   Cash and cash equivalents 
   at the end of the period                              599                 (306)                                 291 
                                              ==============       ===============       ============================= 
 
 Cash and cash equivalents 
  included in discontinued                                 -                   902                                   - 
  operations 
 
 Cash and cash equivalents 
  for continuing operations                              599               (1,208)                                 291 
 
 Cash and cash equivalents 
  compromise: 
 
   Cash at bank / (overdraft)                            599                 (306)                                 291 
                                              ==============       ===============       ============================= 
 

Consolidated Statement of Changes in Equity

for the six months ended 30 September 2019

 
                                                                 Capital 
                                                              redemption    Hedging     Retained 
                             Share capital   Share premium       reserve    reserve     earnings    Total equity 
 
                                    GBP000          GBP000        GBP000     GBP000       GBP000          GBP000 
 
 At 1 April 2018                     1,990           1,269           109       (15)        (197)           3,156 
 Loss for the period 
  (restated)                             -               -             -          -        (264)           (264) 
 Other comprehensive 
  expense for the period 
  net of tax                             -               -             -      (132)          798             666 
                            --------------  --------------  ------------  ---------  -----------  -------------- 
 Total comprehensive 
  (expense)/income                       -               -             -      (132)          534             402 
 Share based payments                    -               -             -          -            4               4 
 Total of transactions 
  with shareholders                      -               -             -          -            4               4 
 
 At 30 September 2018                1,990           1,269           109      (147)          341           3,562 
 
 Loss for the period                     -               -             -          -        1,790           1,790 
 Other comprehensive 
  income/ (expense) 
  for the period net 
  of tax                                 -               -             -        243        (737)           (494) 
                            --------------  --------------  ------------  ---------  -----------  -------------- 
 Total comprehensive 
  income                                 -               -             -        243        1,053           1,296 
 Share based payments                    -               -             -          -           36              36 
 Deferred tax on employee 
  share options                          -               -             -          -         (26)            (26) 
                            --------------  --------------  ------------  ---------  -----------  -------------- 
 Total of transactions 
  with shareholders                      -               -             -          -           10              10 
 
 At 1 April 2019                     1,990           1,269           109         96        1,404           4,868 
 
 Loss for the period                     -               -             -          -      (1,986)         (1,986) 
 Other comprehensive 
  income for the period 
  net of tax                             -               -             -      (137)        (211)           (348) 
 Total comprehensive 
  expense                                -               -             -      (137)      (2,197)         (2,334) 
 Share based payments                    -               -             -          -           14              14 
 Deferred tax on employee 
  share options                                                                              (2)             (2) 
 Total of transactions 
  with shareholders                      -               -             -          -           12              12 
 
 At 30 September 2019                1,990           1,269           109       (41)        (781)           2,546 
                            ==============  ==============  ============  =========  ===========  ============== 
 

Independent review report to Chamberlin plc

Introduction

We have been engaged by the company to review the financial information in the half-yearly financial report for the six months ended 30 September 2019 which comprises the Consolidated Income Statement, Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Consolidated Statement of Cash Flows, Consolidated Statement of Changes in Equity and the related notes. We have read the other information contained in the half yearly financial and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The AIM rules of the London Stock Exchange require that the accounting policies and presentation applied to the financial information in the half-yearly financial report are consistent with those which will be adopted in the annual accounts having regard to the accounting standards applicable for such accounts.

As disclosed in Note 1, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the European Union. The financial information in the half-yearly financial report has been prepared in accordance with the basis of preparation in Note 1.

Our responsibility

Our responsibility is to express to the company a conclusion on the financial information in the half-yearly financial report based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the financial information in the half-yearly financial report for the six months ended 30 September 2019 is not prepared, in all material respects, in accordance with the basis of accounting described in Note 1.

Use of our report

This report is made solely to the company in accordance with guidance contained in ISRE (UK and Ireland) 2410, 'Review of Interim Financial Information performed by the Independent Auditor of the Entity'. Our review work has been undertaken so that we might state to the company those matters we are required to state to it in a review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company for our review work, for this report, or for the conclusion we have formed.

Grant Thornton UK LLP

Statutory Auditor, Chartered Accountants

Birmingham

18 November 2019

Notes to the Interim Financial statements

   1              General information and accounting policies 

This Interim Financial Report is unaudited, but has been reviewed by the Company's auditor having regard to the International Standard on Review Engagements (UK & Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity", issued by the Auditing Practices Board for use in the UK. A copy of their unmodified review report is attached.

The interim condensed consolidated financial statements do not comprise the Group's statutory accounts as defined by section 434 of the Companies Act 2006. Statutory accounts for the year ended 31 March 2019 were approved by the board of directors on 3 June 2019 and were filed at Companies House. The auditor's report on those accounts was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under section 498(2) or (3) of the Companies Act 2006.

Basis of preparation

The annual financial statements of the Group are prepared in accordance with IFRS as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with the AIM Rules issued by the London Stock Exchange.

Accounting policies

The principal accounting policies applied in preparing the interim Financial Statements comply with IFRS as adopted by the European Union and are consistent with the policies set out in the Annual Report and Accounts for the year ended 31 March 2019.

Comparative information for the six months ending 30 September 2018 has been restated following the adoption of IFRS 16 'Leases' in the second half of the 2019 financial year. In addition, a change has been made to the presentation of administration costs and interest costs associated with the company's defined benefit pension scheme. Previously, these costs were shown as non-underlying items. Management is now of the view that such costs should be reported as part of underlying results reflecting the on-going recurring nature of these costs. As a result of these changes, the underlying results in the comparative periods have been restated as shown in note 9.

No new standards or interpretations issued since 31 March 2019 have had a material impact on the accounting of the Group.

Going concern

After making enquiries and reviewing the group's forecasts and projections, the directors have a reasonable expectation that the Group is able to operate for the foreseeable future within its current facilities, comprising finance leases of GBP2.6m repayable over 4 years, right of use lease liabilities of GBP0.9m repayable over 8 years and an invoice finance discounting facility renewable annually in March for the lower of GBP7.75m and 90% of outstanding invoices. Accordingly, the directors continue to adopt the going concern basis in preparing the half-yearly condensed consolidated interim financial statements.

   2              Segmental analysis 

For management purposes, the Group is organised into two operating divisions: Foundries and Engineering. The operating segments reporting format reflects the Group's management and internal reporting structures for the Chief Operating Decision Maker.

 
                                       Revenue                                Operating (loss)/ profit 
                                                                                       Unaudited 
                          Unaudited       Unaudited                    Unaudited      six months 
                         six months      six months         Year      six months           ended 
                              ended           ended        ended           ended    30 September        Year ended 
                       30 September    30 September     31 March    30 September            2018          31 March 
                               2019            2018         2019            2019        restated     2019 restated 
 
                             GBP000          GBP000       GBP000          GBP000          GBP000            GBP000 
 
 Foundries                   11,177          15,427       29,343           (522)             133             (211) 
 Engineering                  1,651           1,936        3,615              18             119               251 
                     --------------  --------------  -----------  --------------  --------------  ---------------- 
 Segmental results           12,828          17,363       32,958           (504)             252                40 
                     --------------  --------------  ----------- 
 Shared costs                                                              (506)           (621)           (1,050) 
 Exceptional 
  and 
  non-underlying 
  costs                                                                    (686)             (4)           (3,448) 
 Net finance 
  costs                                                                    (147)           (233)             (499) 
 Loss before 
  tax from 
  continuing 
  operations                                                             (1,843)           (606)           (4,957) 
                                                                  ==============  ==============  ================ 
 
 

The Foundries segment is a supplier of iron castings, in raw or machined form, to a variety of industrial customers who incorporate the castings into their own products or carry out further machining or assembly operations on the castings before selling them on. The Engineering segment provides manufactured and imported products to distributors and end-users. The products fall into the categories of hazardous area lighting and cable management.

Financing and income tax are managed on a Group basis and are not allocated to operating segments.

   3              Finance costs 
 
                                                Unaudited        Unaudited 
                                               six months       six months 
                                                    ended            ended   Year ended 
                                             30 September     30 September     31 March 
                                                     2019    2018 restated         2019 
                                                   GBP000           GBP000       GBP000 
 Interest on bank overdraft                          (46)            (152)        (335) 
 Interest expense on lease liabilities               (72)             (19)         (52) 
 Net interest on defined benefit pension 
  liability                                          (29)             (62)        (112) 
                                                    (147)            (233)        (499) 
                                           ==============  ===============  =========== 
 
   4              Income tax expense 

An estimated effective rate of tax for the six months to 30 September 2019 of 7.8% (30 September 2018: 20.0%) has been used in these interim statements. This rate is below the standard corporation tax rate of 19% due primarily to not recognising a deferred tax asset on trading losses, due to uncertainty over when the losses will recoverable. The corporation tax rate remained at 19% for the year ended 31 March 2019. The rate will fall to 17% from 1 April 2020. It is not anticipated that the subsequent reduction to 17% will have a material effect on the Company's future current or deferred tax charges.

   5              (Loss)/ earnings per share 

The calculation of (loss)/earnings per share is based on the profit attributable to shareholders and the weighted average number of ordinary shares in issue. In calculating the diluted (loss)/earnings per share, adjustment has been made for the dilutive effect of outstanding share options. Underlying (loss) per share, which excludes exceptional costs, net financing cost on pension obligations, administration costs of the pension scheme and share based compensation, less related tax thereon, as analysed below, has been disclosed as the Directors believe this allows a better assessment of the underlying trading performance of the Group.

 
                                           Unaudited        Unaudited 
                                    six months ended       six months        Year ended 
                                        30 September            ended          31 March 
                                                2019     30 September     2019 restated 
                                                        2018 restated 
                                              GBP000           GBP000            GBP000 
 Continuing operations loss for 
  basic earnings per share                   (1,986)            (485)           (4,909) 
 Non-underlying operating items                  686                4             3,448 
 Taxation effect of the above                      -                -              (87) 
                                  ------------------  ---------------  ---------------- 
 
   Loss for underlying earnings 
   per share                                 (1,300)            (481)           (1,548) 
                                  ------------------  ---------------  ---------------- 
 
 
 
 
                                                Unaudited       Unaudited 
                                         six months ended      six months     Year ended 
                                             30 September           ended       31 March 
                                                     2019    30 September           2019 
                                                                     2018 
                                                   GBP000          GBP000         GBP000 
 Discontinued operations loss 
  for basic earnings per share                          -             221          6,435 
 Exceptional costs                                      -               -              - 
 Taxation effect of the above                           -               -              - 
                                       ------------------  --------------  ------------- 
 
   Earnings for underlying earnings 
   per share                                            -             221          6,435 
                                       ------------------  --------------  ------------- 
 
                                                Unaudited       Unaudited 
                                         six months ended      six months     Year ended 
                                             30 September           ended       31 March 
                                                     2019    30 September           2019 
                                                                     2018 
                                                      000             000            000 
 Weighted average number of ordinary 
  shares                                            7,958           7,958          7,958 
 Adjustment to reflect dilutive 
  shares under option                                 424             350            424 
                                       ------------------  --------------  ------------- 
 
   Diluted weighted average number 
   of ordinary shares                               8,382           8,308          8,382 
                                       ------------------  --------------  ------------- 
 

There is no adjustment for the shares under option in the diluted loss per share calculation as they are required to be excluded from the weighted average number of shares as they are anti-dilutive.

   6              Pensions 

The Group operates a defined benefit pension scheme and a number of defined contribution pension schemes on behalf of its employees. For defined contribution schemes, contributions paid in the period are charged to the income statement. For the defined benefit scheme, actuarial calculations are performed in accordance with IAS 19 in order to arrive at the amounts to be charged in the income statement and recognised in the statement of comprehensive income. The defined benefit scheme is closed to new entrants and future accrual.

Under IAS 19, the Group recognises all movements in the actuarial funding position of the scheme in each period. This is likely to lead to volatility in shareholders' equity from period to period.

The IAS 19 figures are based on a number of actuarial assumptions as set out below, which the actuaries have confirmed they consider appropriate. The projected unit credit actuarial cost method has been used in the actuarial calculations.

 
                                  30 September   30 September   31 March 
                                          2019           2018       2019 
 
 Salary increases                          n/a            n/a        n/a 
 Pension increases (post 1997)            3.0%           3.1%       3.2% 
 Discount rate                            1.7%           2.7%       2.3% 
 Inflation assumption - RPI               3.1%           3.2%       3.3% 
 Inflation assumption - CPI               2.1%           2.2%       2.3% 
 

The demographic assumptions used for 30 September 2019, were the same as used in 31 March 2019, 30 September 2018 and the last full actuarial valuation performed as at 1 April 2016. The contributions expected to be paid during the year to 31 March 2020 are GBP278,000. The next triennial valuation as at 1 April 2019 is currently in progress and is expected to be concluded by the end of quarter two in 2020.

The defined benefit scheme funding has changed under IAS 19 as follows:

 
                                                 Unaudited                   Unaudited 
                                                six months                  six months      Year to 
   Funding status                                       to                          to     31 March 
                                              30 September                30 September         2019 
                                                      2019                        2018       GBP000 
                                                    GBP000                      GBP000 
 Scheme assets at end of period                     16,861                      13,617       16,065 
 Benefit obligations at end of 
  period                                          (19,652)                    (17,640)     (18,705) 
                                  ------------------------  --------------------------  ----------- 
 
 Deficit in scheme                                 (2,791)                     (4,023)      (2,640) 
 Related deferred tax asset                            474                         684          448 
                                  ------------------------  --------------------------  ----------- 
 Net pension liability                             (2,317)                     (3,339)      (2,192) 
                                  ========================  ==========================  =========== 
 
 

The increase in the net pension liability since March 2019 is mainly due to an increase in the value of liabilities as a consequence of a reduction in bond yields reducing the discount rate.

   7              Exceptional costs and non-underlying items 
 
                                       Unaudited       Unaudited 
                                      six months      six months     Year ended 
                                           ended           ended       31 March 
                                    30 September    30 September           2019 
                                            2019            2018 
                                          GBP000          GBP000         GBP000 
 Group reorganisation                        672               -             54 
 Asset impairment                              -               -          3,043 
 Onerous leases                                -               -             16 
 Share based payment charge                   14               4             40 
                                  --------------  --------------  ------------- 
 Non-underlying operating costs              686               4          3,448 
 
 
 Taxation 
 - tax effect of non-underlying 
  costs                              -   -    (87) 
 
                                   686   4   3,361 
                                  ====      ====== 
 

During the half year ended 30 September 2019, the Group undertook a Group wide restructuring programme in order to realign the cost base to the reduced levels of revenue. Group reorganisation costs of GBP672,000, which include redundancy and related costs, relate to this rationalisation programme.

   8              Net debt 
 
                                           Unaudited        Unaudited 
                                          six months       six months     Year ended 
                                               ended            ended       31 March 
                                        30 September     30 September           2019 
                                                2019    2018 restated 
                                              GBP000           GBP000         GBP000 
 Financial liabilities 
 (Net cash)/bank overdraft                     (599)              306          (291) 
 Current instalments due on finance 
  leases                                       1,022              961          1,055 
 Current instalments due on asset                  -              600              - 
  finance loans 
 Invoice finance liability                     3,137            6,867          1,628 
                                      --------------  ---------------  ------------- 
 Net debt due in less than one 
  year                                         3,560            8,734          2,392 
                                      --------------  ---------------  ------------- 
 
 Instalments due on finance leases 
  in greater than one year                     2,491            2,469          2,966 
 
 Net debt                                      6,051           11,203          5,358 
                                      ==============  ===============  ============= 
 
 

Instalments due under finance leases include "right of use" assets, primarily property leases, totaling GBP906,000.

   9              Restatement of comparatives 

Following the early adoption of IFRS 16 'Leases' in the second half of the year ended 31 March 2019, comparative amounts for the half year ended 30 September 2018 have been restated on a comparable basis.

In addition, a change has been made to the presentation of administration costs and interest costs associated with the company's defined benefit pension scheme. Previously, these costs were shown as non-underlying items. Management is now of the view that such costs should be reported as part of underlying results reflecting the on-going recurring nature of these costs. As a result of this presentational change, the underlying results in the comparative periods have been restated. There is no change to statutory results as a consequence of this presentational change.

The impact of the above changes on the comparatives is set out below:

 
 
 
   Impact on loss, assets and         As previously                            Pension 
   liabilities at 30 September             reported     Impact of                costs     As restated 
   2018                                                   IFRS 16     reclassification 
                                             GBP000        GBP000               GBP000          GBP000 
 Income statement 
 Underlying operating loss                    (333)            21                 (57)           (369) 
 Underlying finance costs                     (152)          (19)                 (62)           (233) 
                                   ----------------  ------------  -------------------  -------------- 
 Underlying loss before tax                   (485)             2                (119)           (602) 
 Taxation                                        98             -                   23             121 
                                   ----------------  ------------  -------------------  -------------- 
 Underlying loss from continuing 
  operations                                  (387)             2                 (96)           (481) 
                                   ================  ============  ===================  ============== 
 
 
 Balance sheet 
 Assets 
 Property, plant & equipment                 10,407                  736               -   11,143 
                                   ================  ===================  ==============  ======= 
 Liabilities 
 Financial liabilities due 
  in less than 1 year                         8,614                  120               -    8,734 
 Financial liabilities due 
  in more than 1 year                         1,855                  614               -    2,469 
                                   ----------------  -------------------  --------------  ------- 
 Total liabilities                           10,469                  734               -   11,203 
                                   ================  ===================  ==============  ======= 
 
 
   Impact on underlying loss          As previously              Pension 
   for the year ended 31 March             reported                costs     As restated 
   2019                                                 reclassification 
                                             GBP000               GBP000          GBP000 
 Income statement 
 Underlying operating loss                    (886)                (124)         (1,010) 
 Underlying finance costs                     (387)                (112)           (499) 
                                   ----------------  -------------------  -------------- 
 Underlying loss before tax                 (1,273)                (236)         (1,509) 
 Taxation                                      (63)                   24            (39) 
                                   ----------------  -------------------  -------------- 
 Underlying loss from continuing 
  operations                                (1,336)                (212)         (1,548) 
                                   ================  ===================  ============== 
 
 
   10           Interim report 

Copies of this interim results statement will be available on the Group's website, www.chamberlin.co.uk, and from the Group's headquarters at Chuckery Road, Walsall, West Midlands, WS1 2DU.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

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