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Share Name | Share Symbol | Market | Type |
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Mesoblast Ltd | TG:LWB | Tradegate | Ordinary Share |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
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-0.04 | -6.11% | 0.615 | 0.595 | 0.635 | 0.62 | 0.62 | 0.62 | 4,000 | 22:50:00 |
RNS Number:3759N Low & Bonar PLC 10 July 2003 10 July 2003 Press Release/Stock Exchange Announcement LOW & BONAR PLC 2003 INTERIM RESULTS Low & Bonar PLC today reported its results for the half year ended 31 May 2003. 2003 2002 % Turnover #89.4m #79.1m + 13 Operating profit (pre exceptional) # 5.2m # 3.9m + 33 Profit before tax # 4.3m # 3.8m + 13 Earnings per share (pre exceptional) 3.28p 2.44p + 34 Dividend per share 1.50p 2.50p * Pre exceptional eps growing by 34% from 2.44p to 3.28p * Floors: - Operating profit growth from existing business of #0.5m despite lower sales in demanding markets - Acquired carpet tile business trading in line with expectation, and achievement of synergies from acquisition on track * Yarns & Fabrics: - Continued growth in artificial grass yarns business - Operating profit at Belgian business held despite steep rise in polypropylene prices in 2nd quarter * Plastics: - Operating profit increased by #0.8m - Revenue growth of 6%, originating in North America and Northern Europe - Turnaround of French business proceeding in line with expectations * Ungeared balance sheet with #0.9m net cash reflecting strong cash performance * Dividend per share of 1.5p in line with the new dividend policy announced at the year end - 2 - Commenting on the results, Low & Bonar's recently appointed Chief Executive, Paul Forman, said: "The market conditions in which we operate remain demanding. Nonetheless we have achieved underlying revenue growth in four of our five business areas. This, allied to cost restructuring activities, has produced Low & Bonar's first like-for-like profit growth in a considerable period. I am pleased to report that the programme to bring French Plastics to a breakeven level is progressing as planned and that the acquisition of the carpet tile business is meeting the expectations set out in the circular in January. Operating profit is improving despite our having to contend with particularly high raw material costs in the second quarter and an increased pension charge. A tight focus on cash management has also enabled us to finish the half year with no borrowings, despite the carpet tile business acquisition. It remains difficult to predict the market conditions but I remain cautiously confident that we can continue this improved performance in the second half." - Ends - Enquiries: Duncan Clegg, Chairman Paul Forman, Chief Executive Jon Kempster, Finance Director Low & Bonar PLC Tel: 020 7298 6820 Tim Spratt Michelle Morton Financial Dynamics Tel: 020 7831 3113 Photographs for the media are available at Visual Media Online www.vismedia.co.uk 020 7436 9595 CHAIRMAN'S INTERIM STATEMENT As we stated at the time of the Annual General Meeting, our markets remained extremely demanding and raw material prices had increased substantially in the second quarter. Despite this backdrop our businesses achieved a good performance with pre exceptional operating profit improving to #5.2m from #3.9m including a three month contribution from the acquired carpet tile business. To provide additional information, the segmental analysis below has been expanded to isolate the central costs which includes the past service cost element of the UK pension scheme. Exceptional costs of #0.3m were incurred in our Floors operation because of a reduction in headcount in the first half. In addition, integration costs of #0.3m have been incurred, as predicted, as a consequence of the Gaskell Carpet Tile Division acquisition. Profit before tax was #4.3m (2002: #3.8m) after an interest expense of #0.3m (2002: #0.2m). Earnings per share were 2.87p (2002: 2.44p) with a tax rate of 34% (2002: 35%). On a pre exceptional basis, earnings per share were 3.28p (2002: 2.44p). Despite the acquisition of the carpet tile business a positive Group net cash position has been maintained, albeit at a much reduced level of #0.9m (2002: #9.4m). This has been possible due to a strong performance in managing working capital and will continue to be a prime focus for the Group. The directors have declared an interim ordinary dividend of 1.5p per share in line with the new dividend policy announced in February 2003 (2002: 2.5p) which will be paid on 2 October 2003 to ordinary shareholders on the register on 5 September 2003. CHIEF EXECUTIVE'S REVIEW OF OPERATIONS Flooring Excluding the acquisition of the carpet tile business, operating profit grew to #4.0m for the half year (2002: #3.5m) despite a decline in sales to #25.8m (2002: #27.7m). The revenue shortfall was caused by the decrease in sales of a third party product in the US, subdued demand in the German and Benelux markets and a SARS-driven slowdown in Hong Kong and Southern China. Action was taken by the new Managing Director, Mark Sefton, to reduce many cost elements. This drove operating margins up significantly from 12.7% in the first half of 2002 to 15.5% in the first half of 2003. The focus now is to build on this progress through a much more determined and structured approach to organic growth. Our capabilities in this area are being further strengthened by selective recruitment. The newly acquired carpet tile business has been satisfactorily integrated into Bonar Floors. Both its own level of trading and the post merger integration work have met expectations fully and we are beginning to see selected examples of large customers purchasing our full range of products as a "one-stop-shop" offering. Yarns & Fabrics Yarns & Fabrics continued its improvement in sales despite demanding markets in much of Europe, particularly Germany and Benelux. Sales of #23.4m compared to #20.2m last year. Sales in our Dundee yarns business benefited from the continued growth in artificial sports surfaces and the carpet backing yarns business held up relatively well. The Belgian business had a more mixed experience with non-woven fabrics and groundcovers progressing but a number of other sectors experiencing very tough market conditions, especially in Spain and Benelux. Nonetheless the volume growth achieved across Yarns & Fabrics, together with selective cost improvements, meant that we were able to grow profitability above the 2002 half year levels despite a sharp upward movement in polypropylene prices in the second quarter. In aggregate operating profit grew to #1.1m (2002: #1.0m) for the first half year. Our expectation for the second half is of lower material prices and hence scope for higher margins. Plastics Plastics moved further into profit driven by good sales growth across the division and much improved cost control in our French operation. Sales were #33.0m (2002: #31.2m) with an operating profit of #0.9m (2002: #0.2m). A number of new product introductions have helped us grow in virtually every site and our North American business saw some indications of limited market recovery towards the end of the first half. Cost reduction measures, allied to better operational control, ensured the French operation moved ahead and tighter financial controls were instigated across all the Plastics businesses. Our Danish business had a disappointing first half and we have targeted the improvements necessary to ensure a better performance going forward. Progress across Plastics is being consolidated by strengthening the management teams in both Europe and North America. Outlook It remains difficult to predict the market conditions for the balance of the year. Broadly our markets mirror the overall pattern of national GDP with the US and the UK proving most resilient and Germany least so. I am pleased, however, that a number of management actions, as contained in the January strategic review, aimed at growing our market shares and improving our cost base are starting to improve operating margins. I anticipate this improvement being sustained through the second half and also expect some benefit from lower raw material prices. Consequently, I remain cautiously confident that we can continue this improved performance in the second half. LOW & BONAR PLC Unaudited Consolidated Profit and Loss Account for the half year ended 31 May 2003 Six months Six months Year ended ended ended 31/5/03 31/5/02 30/11/02 #000 #000 #000 Turnover Existing 82,168 79,081 162,637 Acquisitions 7,201 - - 89,369 79,081 162,637 Operating profit before amortisation and exceptional costs Existing 4,229 3,933 7,722 Acquisitions 1,087 - - Amortisation Acquisitions (138) - - Exceptional operating costs (note 5) Existing - restructuring costs (308) - (1,348) Acquisitions - integration costs (274) - - Operating profit Existing 3,921 3,933 6,374 Acquisitions 675 - - 4,596 3,933 6,374 Exceptional non-operating costs (note 5) Loss on disposal of business - - (1,683) Net interest payable (254) (175) (215) Profit on ordinary activities before taxation 4,342 3,758 4,476 Taxation (1,475) (1,315) (2,383) Profit on ordinary activities after taxation 2,867 2,443 2,093 Dividends: Preference (11) (11) (23) Ordinary (1,492) (2,487) (3,979) Transferred to/(from)reserves 1,364 (55) (1,909) Ordinary dividend per share 1.50p 2.50p 4.00p Earnings per share before exceptional items 3.28p 2.44p 4.88p Basic and diluted earnings per share 2.87p 2.44p 2.08p LOW & BONAR PLC Summary Unaudited Group Balance Sheet at 31 May 2003 31/5/03 31/5/02 30/11/02 #000 #000 #000 Fixed assets Tangible assets 62,923 60,072 57,455 Goodwill 10,071 - - 72,994 60,072 57,455 Working capital Stocks 34,898 26,377 24,087 Debtors 51,864 45,403 42,436 Creditors (47,112) (35,856) (35,992) 39,650 35,924 30,531 Net cash 883 9,410 18,231 Tax, dividends and other liabilities (9,929) (7,939) (9,278) 103,598 97,467 96,939 Capital and reserves Share capital 50,137 50,137 50,137 Reserves 53,461 47,330 46,802 103,598 97,467 96,939 LOW & BONAR PLC Summary Unaudited Consolidated Cash Flow Statement for the half year ended 31 May 2003 Six months Six months Year ended ended ended 31/5/03 31/5/02 30/11/02 #000 #000 #000 Net cash inflow/(outflow) from operating activities (note 6) 4,223 (344) 11,132 Net interest paid (219) (473) (524) Non-equity dividends paid (11) (11) (23) Returns on investment and servicing of finance (230) (484) (547) Tax (paid)/recovered (921) (50) 1,193 Purchase of tangible fixed assets (2,068) (2,953) (5,632) Sale of tangible fixed assets 443 2,841 2,840 Receipt of government grants 140 - - Capital expenditure (1,485) (112) (2,792) Acquisitions and disposals (note 7) (18,318) - 333 Equity dividends paid (1,492) (3,482) (5,970) Net cash (outflow)/inflow before management of liquid resources and financing (18,223) (4,472) 3,349 Management of liquid resources 4,000 22,900 30,000 Financing (7,426) (24,223) (31,686) (Decrease)/increase in cash (21,649) (5,795) 1,663 Reconciliation of net cash Opening net cash 18,231 14,858 14,858 Exchange 875 (976) 24 Net cash flow (18,223) (4,472) 3,349 Closing net cash 883 9,410 18,231 LOW & BONAR PLC Consolidated Statement of Total Recognised Gains and Losses for the half year ended 31 May 2003 Six months Six months Year ended ended ended 31/5/03 31/5/02 30/11/02 #000 #000 #000 Profit for the period 2,867 2,443 2,093 Currency translation differences on overseas net investments and related borrowings 5,295 (642) (470) Total recognised gains and losses for the 8,162 1,801 1,623 financial period Prior year adjustment for implementation of FRS 19 'Deferred Tax' - (3,833) (3,595) Total recognised gains and losses since last annual report 8,162 (2,032) (1,972) LOW & BONAR PLC Reconciliation of Movements in Consolidated Shareholders' Funds for the half year ended 31 May 2003 Six months Six months Year Ended ended ended 31/5/03 31/5/02 30/11/02 #000 #000 #000 Profit for the period 2,867 2,443 2,093 Dividends (1,503) (2,498) (4,002) Result for period 1,364 (55) (1,909) Other recognised gains and losses relating to the period 5,295 (642) (470) Goodwill transferred to profit and loss account on disposal of business - - 1,154 Net increase/(decrease) in shareholders' funds 6,659 (697) (1,225) Shareholders' funds at start 96,939 98,164 98,164 Shareholders' funds at end 103,598 97,467 96,939 LOW & BONAR PLC Segmental information for the half year ended 31 May 2003 Turnover Profit Six mths Six mths Year Six mths Six mths Year ended ended Ended ended ended ended 31/5/03 31/5/02 30/11/02 31/5/03 31/5/02 30/11/02 #000 #000 #000 #000 #000 #000 CLASSES OF BUSINESS Floors - Existing businesses 25,820 27,713 56,072 4,006 3,523 7,553 - Acquisitions 7,201 - - 949 - - Yarns & Fabrics 23,393 20,194 44,342 1,093 978 2,630 Total Specialist Materials 56,414 47,907 100,414 6,048 4,501 10,183 North European Plastics 11,580 10,073 21,721 419 678 836 South European Plastics 9,904 10,390 18,728 (138) (910) (1,948) North American Plastics 11,471 10,711 21,774 645 395 489 Total Plastics 32,955 31,174 62,223 926 163 (623) 89,369 79,081 162,637 6,974 4,664 9,560 Central costs (1,796) (731) (1,838) Exceptional operating costs (582) (1,348) - Operating profit 4,596 3,933 6,374 Exceptional non-operating costs - - (1,683) Net interest payable (254) (175) (215) Profit on ordinary activities before taxation 4,342 3,758 4,476 GEOGRAPHICAL SEGMENTS United Kingdom 25,703 17,306 37,125 4,439 3,320 7,328 Continental Europe 52,195 49,939 102,092 1,890 1,434 2,267 North America 11,471 11,836 23,420 645 (90) (35) 89,369 79,081 162,637 6,974 4,664 9,560 Central costs (1,796) (731) (1,838) Exceptional operating costs (582) (1,348) - Operating profit 4,596 3,933 6,374 Exceptional non-operating costs - - (1,683) Net interest payable (254) (175) (215) Profit on ordinary activities before taxation 4,342 3,758 4,476 LOW & BONAR PLC Notes on Interim Report 2003 1. This interim report has been prepared on the basis of the accounting policies set out in the annual report for the year ended 30 November 2002, with the addition of the accounting policy for purchased Goodwill which is set out in note 7. 2. This interim report was approved by the board of directors on 10 July 2003. 3. Taxation on the operating profit after interest before exceptional items has been provided at a rate of 34% for the six months ended 31 May 2003 (2002 - 35%) which is the estimated rate of tax for the full year. 4. Earnings per share are based on the weighted average of ordinary shares in issue during the half year of 99,474,690 (2002 - 99,474,690). There is no dilutive effect of unexercised share options. 5. Exceptional items Six months Six months Year ended ended ended 31/5/03 31/5/02 30/11/02 #000 #000 #000 Operating Floors European restructuring (308) - - Carpet tiles integration costs (274) - - Senior group management changes - - (812) Floors US closure costs - - (536) (582) - (1,348) Non-operating Loss on disposal of business - - (1,683) 6. Net cash inflow/(outflow) from operating activities Six months Six months Year Ended ended ended 31/5/03 31/5/02 30/11/02 #000 #000 #000 Operating profit 4,596 3,933 6,374 Depreciation and amortisation 4,053 3,986 7,738 Write back of government grants (42) (30) (68) Increase in working capital (4,384) (8,233) (2,912) 4,223 (344) 11,132 7. The Group acquired the trade and assets of the carpet tile division of Gaskell plc on 21 February 2003. The Directors consider that the fair values are not materially different from book values at the date of acquisition. Book Value & Fair Value #000 Fixed assets 4,476 Stock 6,056 Debtors 3,877 Creditors (5,329) Net assets acquired 9,080 Purchase consideration, including costs 19,289 Goodwill arising on acquisition 10,209 Analysis of Purchase consideration including costs: Cash paid during period 18,318 Included within creditors at 31 May 2003 971 19,289 Purchased Goodwill is capitalised on the balance sheet and amortised through the profit and loss account over its estimated useful life. The Directors consider that the estimated useful life of the Goodwill arising on the acquisition of the carpet tiles business is 20 years. 8 The comparative figures for the financial year ended 30 November 2002 are not the company's statutory accounts for that financial year. Those accounts have been reported on by the company's auditors and delivered to the registrar of companies. The report of the auditors was unqualified and did not contain a statement under section 237(2) or (3) of the Companies Act 1985. This information is provided by RNS The company news service from the London Stock Exchange END IR RLMRTMMBMBFJ
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