Buy
Sell
Share Name Share Symbol Market Type Share ISIN Share Description
600 Group Plc LSE:SIXH London Ordinary Share GB0008121641 ORD 1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.0% 8.75 8.50 9.00 0.00 01:00:00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Industrial Engineering 67.2 1.1 1.6 5.4 10

600 Group PLC Half-year Report

15/12/2020 7:00am

UK Regulatory (RNS & others)


600 (LSE:SIXH)
Historical Stock Chart


From Oct 2020 to Apr 2021

Click Here for more 600 Charts.

TIDMSIXH

RNS Number : 6228I

600 Group PLC

15 December 2020

The 600 Group PLC

Unaudited Interim Results for the six months ended 30 September 2020

The 600 Group PLC ("the Group"), the diversified industrial engineering company (AIM: SIXH), today announces its unaudited interim results for the six months ended 30 September 2020.

Financial highlights

-- Revenues down 29% to $25.4m (FY20 H1: $35.7m), mainly due to significant disruption caused by the COVID-19 pandemic

   --   Underlying* operating profit of $0.2m (FY20 H1: $2.5m) 

-- Net debt excluding leases but including $2.2m of USA PPP funding of $16.7m (FY 20 H1: $16.9m, FY20 year end: $14.2m)

   --   Operations continue to produce positive cashflows 

Strategic & operational highlights

-- Quick response to challenging market conditions with businesses adapting new working practices, reducing overheads and deferring all non-critical capital expenditure

-- Debt levels stabilised as a result of significant steps taken in the prior year to de-risk the Group

-- Continued investment in synergy benefits between businesses in the USA and cross fertilisation of technology and customer contacts continues

-- Establishing operations in Germany to promote the direct sale of higher specification machines and support the distribution businesses in this important market

   * from continuing operations, before   adjusting items . 

Paul Dupee, Executive Chairman of the Group, commented:

"The reporting period has been heavily impacted by the COVID-19 pandemic. However, the Group responded quickly to the challenges, reducing costs and keeping our core competencies together.

The de-risking of the Group, both operationally and financially, in the last year has created a platform from which we can leverage the strength of the Group's brands and grow the business into increasingly diversified niche markets worldwide both organically and by acquisition once activity levels normalise .

Whilst short-term macro-economic uncertainty remains, I am confident that we will come out of this crisis a stronger and leaner business."

Enquiries:

 
 The 600 Group PLC                 Tel: 01924 415000 
  Paul Dupee, Executive Chairman 
 Instinctif Partners               Tel: 0207 457 2020 
  Mark Garraway 
  Rosie Driscoll 
 
 
 Spark Advisory Partners Limited (NOMAD)   Tel: 020 3368 3553 
  Matt Davis 
 WH Ireland (Broker)                       Tel: 020 7220 1666 
  Harry Ansell 
 

The 600 Group Plc

Executive Chairman's Statement for the six months ended 30 September 2020

Overview

The six month period ended 30 September 2020 bore the brunt of the impact from the COVID-19 pandemic with the Group trading at a loss in May and June as all facilities were affected by local and national shutdowns and the UK factory operation closed completely for the month of May.

Revenues and orders inevitably fell, but the Board and local management teams responded quickly, adopting short time and home working and furloughing some staff with others accepting temporary salary reductions. The Group took advantage of government stimulus packages including loans under the USA Government Paycheck Protection Program (PPP) and the UK Coronavirus Large Business Interruption Scheme (CLBILS). The UK and Australian businesses also received direct assistance to help maintain employment and this is shown as other income in the Consolidated Income Statement. Overheads were reduced and all non-critical capital expenditure deferred.

Debt levels have been stabilized as a result of significant de-risking of the Group in the prior year with the receipt of the pension surplus following the successful buy out of the scheme and the sale of the loss making Gamet bearings operation and associated freehold property. Debt during the six months to September 2020 remained in line with the $14m of the March 2020 year end apart from the $2.2m of USA PPP funds, which are currently shown in debt but under the terms of the funding, are expected to be largely forgiven following claim submissions to be filed in the next month. Debt was further reduced by $1.6m following the period end, when in October the Brisbane freehold was sold as part of the restructuring of the Australian operations.

Results

Revenue was down at $25.4m (FY 20 H1: $35.7m) with net underlying operating profit (excluding adjusting items) at $0.2m (FY20 H1:$2.5m).

After taking account of interest on bank borrowings, loan notes and lease liabilities, the underlying loss for the Group pre-tax before adjusting items was $0.6m (FY20 H1: profit $1.7m) and a loss of $1.2m (FY 20 H1: profit $1.5m) after adjusting items.

The total loss for the financial period on continuing activities was $1.1m (FY 20 H1: profit $1.1m), providing Basic earnings loss of 0.93 cents (equivalent to 0.74p loss) per share (FY 20 H1: 0.92 cents (equivalent to 0.72p). The underlying continuing earnings per share (excluding adjusting items) were loss 0.36c (equivalent to

0.29p loss)   (FY 20 H1: 1.31c (equivalent to 1.03p). 

Whilst these results are disappointing the Group has continued to trade at a positive cash position with adjusted EBITDA, after allowing for property rentals, at $0.5m in the six months to September 2020 which compares to $2.7m in the previous half year.

Given the current trading and continuing uncertainty no dividend is proposed.

Financial position

Working capital levels reduced during the period with falls in inventory levels and receivables by $1m. Trade and other payables, which include customer deposits, reduced by $2.3m with suppliers paid down and supply lines adjusted to the reduced volumes.

All non essential capital expenditure was deferred due to the COVID-19 pandemic and only $0.18m was expended against $0.36m in the prior half year.

The three USA businesses took advantage of Government assistance under PPP legislation and in total $2.2m was received in early May to assist with maintaining employment and meeting other operating costs. These loans may be forgiven as claims to be submitted in the next month show expenditure against specified costs and continuation of employment numbers. Any amounts not forgiven become a two year loan at 1% interest. The UK machine tools business received a $1.5m loan under the Government CLBILS assistance in late August. This loan is a bullet repayment in three years time in September 2023 with interest at 1.92%.

Both Bank of America and HSBC have been very supportive during these difficult times and the annual reviews of the working capital facilities are currently in progress and are expected to be renewed in the normal course on the same terms. The Group remains covenant compliant.

Total debt, excluding leases, was $16.7m at 30 September 2020 which includes the $2.2m of PPP funding and an increase of $0.4m on the retranslation of the sterling based loan notes, compared to $16.9m at September 2019 and $14.2m at the end of March 2020.

Debt levels reduced in late October 2020 by $1.6m on receipt of the proceeds of the sale of the Brisbane freehold property as part of the restructuring of the Australian operation. The property has been shown as an asset held for sale in the statement of financial position at 30 September 2020.

Adjusting items

Adjusting Items have been noted separately to provide a clearer picture of the Group's underlying trading performance and are set out in note 3. In the current period the initial costs of the Group restructuring announced in the Annual Report in November 2020 of $0.2m and the amortisation of acquisition intangibles relating to the acquisition of CMS of $0.2 have been recorded as adjusting items in operating expenses. The amortisation of the loan note discounting and costs of $0.3m are shown as adjusting items within finance costs.

Operating activities

Machine tools and precision engineered components

Machine tool activity globally has been severely affected by the COVID-19 pandemic with overall volumes down over 31% compared to the same period last year. The UK business had seen significant improvement, before the COVID-19 pandemic struck, as a result of the restructuring of operation and re-launch as Colchester Machine Tool Solutions in the new European technology Centre in Elland. This allowed the business to continue trading satisfactorily through April 2020, but, with most customers closed as the National lockdown continued, the decision was taken to close the operation for the month of May. The business has since operated at a reduced level utilising Government assistance with some staff furloughed and others accepting temporary pay cuts or reduced working hours. Whilst order activity has seen an increase in October and November, short term macroeconomic uncertainty remains combined with potential supply disruption created by Brexit and port congestion.

An operation is being established in Germany to promote the direct sale of higher specification machines, support the distribution businesses and to reduce the impact of a no deal Brexit in this important market.

The USA business similarly suffered significant volume reductions but continued to operate on reduced staffing levels and has also seen an upturn in order activity in recent months.

The Australian business was not as significantly affected being only nearly 20% down but did operate on reduced staff levels and took advantage of Government assistance wherever possible. The restructuring of the operation continued during the period and the freehold premises in Brisbane was sold in late October with the continuing activity taking a smaller space in the existing facility on a rental basis.

The results of the division were as follows:

 
                      FY21 H1   FY20 H1 
 
                       $m        $m 
 Revenues             15.55     22.62 
 Operating profit*    0.74      1.66 
 Operating margin*    4.8%      7.3% 
 

*from continuing operations, before adjusting items.

Industrial Laser systems

The industrial laser businesses suffered from local restrictions in the USA with many customers unable to accept site visits and significant uncertainty delaying many projects. Revenues overall were down 24.5%. As a consequence of the businesses being largely technical and manufacturing orientated they were not able to be as flexible as the largely distribution machine tools operation and, therefore, operating inefficiencies were greater. The TYKMA Electrox business has seen improved order intake in recent months but the CMS operation, which relies on larger projects with longer lead times, has yet to see a sustained pick up in activity.

The Group is continuing to investigate synergy benefits between the two businesses and the cross fertilisation of technology and customer contacts continues.

 
                      FY21 H1   FY20 H1 
                       $m        $m 
 Revenues             9.85      13.04 
 Operating profit*    0.24      1.82 
 Operating margin*    2.4%      14.0% 
 

*from continuing operations, before adjusting items.

Summary and outlook

The reporting period has been heavily impacted by the COVID-19 pandemic. However, the Group responded quickly to the challenges, reducing costs and keeping our core competencies together.

The de-risking of the Group, both operationally and financially, in the last year has created a platform from which we can leverage the strength of the Group's brands and grow the business into increasingly diversified niche markets worldwide both organically and by acquisition once activity levels normalise.

Whilst short-term macro-economic uncertainty remains, I am confident that we will come out of this crisis a stronger and leaner business.

Paul Dupee

Executive Chairman

15 December 2020

The 600 Group Plc

Condensed consolidated income statement (unaudited)

For the 26 week period ended 30 September 2020

 
                              Before                       After        Before                         After 
                           Adjusting     Adjusting     Adjusting     Adjusting       Adjusting     Adjusting 
                               Items         Items         Items         Items           Items         Items 
                            26 weeks      26 weeks      26 weeks      26 weeks        26 weeks      26 weeks  52 weeks 
                               ended         ended         ended         ended           ended         ended     ended 
                        30 September  30 September  30 September  28 September    28 September  28 September  30 March 
                               202 0         2 020         2 020          2019            2019          2019     2 020 
                                $000          $000          $000          $000            $000          $000      $000 
----------------------  ------------  ------------  ------------  ------------  --------------  ------------  -------- 
C ontinuing 
Revenue                       25,398             -        25,398       3 5,657               -        35,657    67,206 
Cost of sales               (16,405)             -      (16,405)     ( 22,922)               -      (22,922)  (43,491) 
Adjusting items in 
 cost 
 of sales                          -             -             -             -               -             -     (254) 
Gross profit                   8,993             -         8,993       1 2,735               -        12,735    23,461 
Net operating expenses       (9,201)             -       (9,201)     ( 10,209)               -      (10,209)  (20,988) 
Adjusting Items in 
 operating 
 expenses                          -         (370)         (370)             -           (713)         (713)   (1,742) 
Other income - 
 Government 
 funding                         380             -           380 
Profit on disposal of 
 pension scheme                    -             -             -             -             809           809       809 
Operating 
 profit/(loss)                  1 72        (370 )       (1 98 )        2 ,526              96         2,622     1,540 
 
Bank interest                      6             -             6             -               -             -         5 
Interest on pension 
 surplus                           -             -             -             -               -             -        22 
                        ------------  ------------  ------------  ------------  --------------  ------------  -------- 
Financial income                   6             -             6             -               -             -        27 
                        ------------  ------------  ------------  ------------  --------------  ------------  -------- 
Bank and other 
 interest                     ( 555)             -         (555)         (662)               -         (662)   (1,282) 
Interest on lease                                                                                                 (382 
 liabilities                  (1 91)             -         (191)        (2 01)               -         (201)         ) 
Loan note amortisation             -        ( 300)        ( 300)                         (259)        ( 259)     (536) 
                        ------------  ------------  ------------  ------------  --------------  ------------  -------- 
Financial expense             ( 746)        ( 300)      ( 1,046)         (863)           (259)      ( 1,122)   (2,200) 
 
(Loss)/profit before                                      (1,238 
 tax                          (568 )         (670)             )         1,663           (163)         1,500     (633) 
 
Income tax c redit/ 
 ( charge)                       140             -           140         (155)           (283)        (438 )    1 ,228 
----------------------  ------------  ------------  ------------  ------------  --------------  ------------  -------- 
(Loss)Profit for the 
 period on continuing 
 activities 
 attributable 
 to equity holders of 
 the parent                    (428)       (6 70 )       (1,098)         1,508           (446)         1,062       595 
(Loss) on discontinued 
 activity                          -             -             -          (73)            (93)         (166)     (960) 
(Loss)/profit for the 
 period attributable 
 to equity holders of 
 the parent                    (428)         (670)       (1,098)         1,435           (539)           896     (365) 
Basic EPS                    (0.36c)                     (0.93c)         1.31c                         0.92c     0.51c 
Diluted EPS                  (0.36c)                     (0.93c)         1.27c                         0.90c     0.50c 
 
Basic EPS after 
 discontinued                (0.36c)                     (0.93c)         1.24c                         0.78c   (0.31c) 
Diluted EPS after 
 discontinued                (0.36c)                     (0.93c)         1.21c                         0.76c   (0.31c) 
 
 
 Condensed consolidated statement of 
  comprehensive income (unaudited) 
  For the 26 week period ended 30 September 
  2020 
                                                    26 weeks       26 weeks   52 weeks 
                                                       Ended          Ended      Ended 
                                                30 September   28 September   28 March 
                                                        2020           2019       2020 
                                                        $000           $000       $000 
---------------------------------------------  -------------  -------------  --------- 
 (Loss)/profit for the period                        (1,098)            896      (365) 
 Other comprehensive (expense)/income: 
  Items that will not be reclassified 
  to the Income Statement: 
 Re-measurement of the net defined benefit 
  asset                                                    3              -       (36) 
 Property revaluation                                    441              -        199 
 Deferred taxation                                         -              -      (282) 
---------------------------------------------  -------------  -------------  --------- 
 Total items that will not be reclassified 
  to the Income Statement:                               444              -      (119) 
 Items that are or may in the future 
  be reclassified to the Income Statement: 
 Foreign exchange translation differences                 41          (673)      (606) 
---------------------------------------------  -------------  -------------  --------- 
 Total items that are or may be reclassified 
  subsequently to the Income Statement:                   41          (673)      (606) 
---------------------------------------------  -------------  -------------  --------- 
 Other comprehensive (expense)/income 
  for the period, net of income tax                      485            223      (725) 
 Total comprehensive (expense)/income 
  for the period                                       (613)            223    (1,090) 
---------------------------------------------  -------------  -------------  --------- 
 
 
 Condensed consolidated statement of financial position (unaudited) 
  As at 30 September 2020 
                                              As at          As at      As at 
                                       30 September   28 September   28 March 
                                               2020           2019       2020 
                                               $000           $000       $000 
------------------------------------  -------------  -------------  --------- 
 Non-current assets 
 Property, plant and equipment                2,876          4,109      4,060 
 Goodwill                                    13,174         15,112     13,174 
 Other Intangible assets                      3,723          1,260      3,868 
 Deferred tax assets                          4,415          4,603      4,415 
 Right of use assets                          8,712         10,260      9,060 
------------------------------------  -------------  -------------  --------- 
                                             32,900         35,344     34,577 
------------------------------------  -------------  -------------  --------- 
 Current assets 
 Inventories                                 18,735         22,698     19,054 
 Trade and other receivables                  7,473         10,379      8,084 
 Taxation                                        75            189        222 
 Deferred tax assets                          1,463              -      1,148 
 Assets classified as held for sale           1,563            949          - 
 Cash and cash equivalents                    3,450          2,534      2,878 
------------------------------------  -------------  -------------  --------- 
                                             32,759         36,749     31,386 
------------------------------------  -------------  -------------  --------- 
 Total assets                                65,659         72,093     65,963 
------------------------------------  -------------  -------------  --------- 
 Non-current liabilities 
                                      -------------  -------------  --------- 
 Employee benefits                          (1,271)        (1,274)    (1,261) 
 Loans and other borrowings                (15,874)       (12,160)   (11,654) 
 Lease Liabilities                          (8,336)        (8,861)    (8,344) 
 Deferred tax liability                           -          (249)          - 
------------------------------------  -------------  -------------  --------- 
                                           (25,481)       (22,544)   (21,259) 
------------------------------------  -------------  -------------  --------- 
 Current liabilities 
 Trade and other payables                   (5,956)        (9,059)    (8,298) 
 Deferred tax liability                       (195)              -      (236) 
 Lease Liabilities                          (1,222)        (1,482)    (1,608) 
 Provisions                                   (613)          (827)      (590) 
 Loans and other borrowings                 (4,242)        (7,271)    (5,414) 
                                      -------------  -------------  --------- 
                                           (12,228)       (18,639)   (16,146) 
------------------------------------  -------------  -------------  --------- 
 Total liabilities                         (37,709)       (41,183)   (37,405) 
------------------------------------  -------------  -------------  --------- 
 Net assets                                  27,950         30,910     28,558 
------------------------------------  -------------  -------------  --------- 
 
   Shareholders' equity 
 Called-up share capital                      1,803          1,803      1,803 
 Share premium account                        3,828          3,828      3,828 
 Revaluation reserve                          1,789          1,149      1,348 
 Equity reserve                                 201            201        201 
 Translation reserve                        (7,089)        (7,197)    (7,130) 
 Retained earnings                           27,418         31,126     28,508 
------------------------------------  -------------  -------------  --------- 
 Total equity                                27,950         30,910     28,558 
------------------------------------  -------------  -------------  --------- 
 
 
Consolidated statement of changes in equity (unaudited) 
 As at 30 September 2020 
                                Ordinary       Share 
                                   share     premium      Revaluation  Translation   Equity  Retained 
                                 capital     account          reserve      reserve  reserve  Earnings    Total 
                                    $000        $000             $000         $000     $000      $000     $000 
--------------------------  ------------  ----------  ---------------  -----------  -------  --------  ------- 
At 30 March 2019                   1,746       2,885            1,149      (6,524)      201    30,186   29,643 
--------------------------  ------------  ----------  ---------------  -----------  -------  --------  ------- 
Profit for the period                  -           -                -            -        -       896      896 
Other comprehensive 
income: 
Foreign currency 
 translation                           -           -                -        (673)        -         -    (673) 
Total comprehensive income             -           -                -        (673)        -       896      223 
--------------------------  ------------  ----------  ---------------  -----------  -------  --------  ------- 
Transactions with owners: 
--------------------------  ------------  ----------  ---------------  -----------  -------  --------  ------- 
Share capital subscribed 
 for                                  57         943                -            -        -         -    1,000 
Credit for share-based 
 payments                              -           -                -            -        -        44       44 
--------------------------  ------------  ----------  ---------------  -----------  -------  --------  ------- 
Total transactions with 
 owners                               57         943                -            -        -        44    1,044 
--------------------------  ------------  ----------  ---------------  -----------  -------  --------  ------- 
At 28 September 2019               1,803       3,828            1,149      (7,197)      201    31,126   30,910 
--------------------------  ------------  ----------  ---------------  -----------  -------  --------  ------- 
Loss for the period                    -           -                -            -        -   (1,261)  (1,261) 
Other comprehensive 
income: 
Foreign currency 
 translation                           -           -                -           67        -         -       67 
Property revaluation                   -           -              199            -        -         -      199 
Net defined benefit 
 movement                              -           -                -            -        -      (36)     (36) 
Deferred tax                           -           -                -            -        -     (282)    (282) 
                            ------------  ----------  ---------------  -----------  -------  --------  ------- 
Total comprehensive income             -           -              199           67        -   (1,579)  (1,313) 
--------------------------  ------------  ----------  ---------------  -----------  -------  --------  ------- 
Transactions with owners: 
Dividend                               -           -                -            -        -   (1,088)  (1,088) 
Credit for share-based 
 payments                              -           -                -            -        -        49       49 
                            ------------  ----------  ---------------  -----------  -------  --------  ------- 
Total transactions with 
 owners                                -           -                -            -        -   (1,039)  (1,039) 
--------------------------  ------------  ----------  ---------------  -----------  -------  --------  ------- 
At 28 March 2020                   1,803       3,828            1,348      (7,130)      201    28,508   28,558 
--------------------------  ------------  ----------  ---------------  -----------  -------  --------  ------- 
Loss for the period                    -           -                -            -        -   (1,098)  (1,098) 
Other comprehensive 
income: 
Foreign currency 
 translation                           -           -                -           41        -         -       41 
Property revaluation                   -           -              441            -        -         -      441 
Net defined benefit 
 movement                              -           -                -            -        -         3        3 
Total comprehensive income             -           -              441           41        -   (1,095)    (613) 
--------------------------  ------------  ----------  ---------------  -----------  -------  --------  ------- 
Transactions with owners: 
Credit for share-based 
 payments                              -           -                -            -        -         5        5 
                            ------------  ----------  ---------------  -----------  -------  --------  ------- 
Total transactions with 
 owners                                -           -                -            -        -         5        5 
--------------------------  ------------  ----------  ---------------  -----------  -------  --------  ------- 
At 30 September 2020               1,803       3,828            1,789      (7,089)      201    27,418   27,950 
--------------------------  ------------  ----------  ---------------  -----------  -------  --------  ------- 
 
 
 
 
   Condensed consolidated cash flow statement (unaudited) 
   For the 26 week period ended 30 September 2020 
                                                       26 weeks ended        26 weeks ended       52 weeks ended 
                                                         30 September          28 September             28 March 
                                                                 2020                  2019                 2020 
                                                                 $000                  $000                 $000 
----------------------------------------------------  ---------------  --------------------  ------------------- 
 Cash flows from operating activities 
 (Loss)/Profit for the period                                 (1,098)                   896                (365) 
 Adjustments for: 
 Amortisation of intangible assets                                206                    13                  325 
 Depreciation                                                     375                   375                  651 
 Depreciation of IFRS16 Right of use assets                       586                   610                1,254 
 Net financial expense/(income)                                 1,040                 1,122                2,173 
 Non-cash adjusting items                                           -                   322                  879 
 Loss on assets held for resale                                     -                     -                  127 
 Profit on disposal of pension                                      -                 (809)                (809) 
 (Profit)/loss on disposal of fixed assets                       ( 9)                     8                   32 
 Equity share option expense                                        5                    44                   93 
 Income tax expense/(credit)                                    (140)                   438              (1,228) 
----------------------------------------------------  ---------------  --------------------  ------------------- 
 Operating cash flow before changes in working 
  capital and provisions                                          965                 3,019                3,132 
 (Increase) /decrease in trade and other receivables              799                 (577)                2,587 
 (Increase)/decrease in inventories                               675               (3,176)                   67 
 (Decrease)/increase in trade and other payables              (2,728)                   400                (973) 
 Employee benefit contributions                                   (9)                     -                 (78) 
 Proceeds from Pension fund disposal                                -                 5,213                5,213 
 Cash generated from/(used in) operations                       (298)                 4,879                9,948 
 Interest paid                                                  (554)                 (451)              (1,141) 
 Lease interest                                                 (191)                     -                (375) 
 Income tax paid                                                    -                  (14)                    - 
----------------------------------------------------  ---------------  --------------------  ------------------- 
 Net cash flows from operating activities                     (1,043)                 4,414                8,432 
----------------------------------------------------  ---------------  --------------------  ------------------- 
 Cash flows from investing activities 
 Interest received                                                  6                     -                    5 
 Payment for acquisition of subsidiary, net of cash 
  acquired                                                          -               (6,062)              (6,072) 
 Proceeds from assets held for sale                                 -                     -                  926 
 Proceeds from sale of property, plant and equipment               81                     -                   57 
 Purchase of property, plant and equipment                      (180)                 (359)                (649) 
 Development expenditure capitalised                             (38)                   (1)                (351) 
 Net cash from investing activities                             (131)               (6,422)              (6,084) 
----------------------------------------------------  ---------------  --------------------  ------------------- 
 Cash flows from financing activities 
 Dividends paid                                                     -                     -              (1,088) 
 Proceeds from/(Net repayment of) external borrowing          (1,479)                 4,388                1,928 
 Government assistance loans                                    3,783 
 IFRS 16 Lease payments                                         (674)                 (716)              (1,212) 
 Net finance lease expenditure                                      -                  (30)                    - 
 Net cash flows from financing activities                       1,630                 3,642                (372) 
----------------------------------------------------  ---------------  --------------------  ------------------- 
 Net increase/(decrease) in cash and cash 
  equivalents                                                     456                 1,634                1,976 
 Cash and cash equivalents at the beginning of the 
  period                                                        2,878                   948                  948 
 Effect of exchange rate fluctuations on cash held                116                  (48)                 (46) 
----------------------------------------------------  ---------------  --------------------  ------------------- 
 Cash and cash equivalents at the end of the period             3,450                 2,534                2,878 
----------------------------------------------------  ---------------  --------------------  ------------------- 
 
 

Notes relating to the condensed consolidated financial statements

For the 26-week period ended 30 September 2020

1. Basis of preparation and accounting policies

These interim consolidated financial statements have been prepared using accounting policies based on International Financial Reporting Standards (IFRS and IFRIC Interpretations) issued by the International Accounting Standards Board ("IASB") as adopted for use in the EU. They do not include all disclosures that would otherwise be required in a complete set of financial statements and should be read in conjunction with the 28 March 2020 Annual Report. The financial information for the half years ended 30 September 2020 and 28 September 2019 does not constitute statutory accounts within the meaning of Section 434 (3) of the Companies Act 2006 and both periods are unaudited.

The annual financial statements of The 600 Group plc ('the Group') are prepared in accordance with IFRS as adopted by the European Union. The comparative financial information for the year ended 28 March 2020 included within this report does not constitute the full statutory Annual Report for that period. The statutory Annual Report and Financial Statements for 2020 will be filed with the Registrar of Companies following the Company's Annual General Meeting on 22 December 2020. The Independent Auditors' Report on the Annual Report and Financial Statements for the year ended 28 March 2020 was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under 498(2) - (3) of the Companies Act 2006.

The Group has applied the same accounting policies and methods of computation in its interim consolidated financial statements as in its 2020 annual financial statements.

2. SEGMENT ANALYSIS

IFRS 8 - "Operating Segments" requires operating segments to be identified on the basis of internal reporting about components of the Group that are regularly reviewed by the chief operating decision maker to allocate resources to the segments and to assess their performance. The chief operating decision maker has been identified as the Executive Directors. The Executive Directors review the Group's internal reporting in order to assess performance and allocate resources.

The Executive Directors consider there to be two continuing operating segments being machine tools and precision engineered Components and industrial laser systems.

The Executive Directors assess the performance of the operating segments based on a measure of operating profit/(loss). This measurement basis excludes the effects of Special Items from the operating segments. Head Office and unallocated represent central functions and costs.

The following is an analysis of the Group's revenue and results by reportable segment:

 
                                                     Continuing 
                                 -------------------------------------------------- 
26 Weeks ended 30 September           Machine 
 2020                                   Tools 
                                  & Precision  Industrial 
                                   Engineered       Laser     Head Office 
                                   Components     Systems   & unallocated     Total    Discontinued    Group Total 
Segmental analysis of 
 revenue                                 $000        $000            $000      $000            $000           $000 
-------------------------------  ------------  ----------  --------------  --------  --------------  ------------- 
Total revenue                          15,551       9,847               -    25,398               -         25,398 
-------------------------------  ------------  ----------  --------------  --------  --------------  ------------- 
 
Operating profit/(loss) 
 pre adjusting items                      737         238           (803)       172               -            172 
 Adjusting items                            -           -           (370)     (370)               -          (370) 
-------------------------------  ------------  ----------  --------------  --------  --------------  ------------- 
Operating profit/(loss)                   737         238         (1,173)     (198)               -          (198) 
-------------------------------  ------------  ----------  --------------  --------  --------------  ------------- 
 
Other segmental information: 
Reportable segment assets              34,542      14,602          16,515    65,659               -         65,659 
Reportable segment liabilities       (19,802)     (5,250)        (12,657)  (37,709)               -       (37,709) 
Intangible & Property, 
 plant and equipment additions             76         135               -       211               -            211 
Depreciation and amortisation             494         497             176     1,167               -          1,167 
-------------------------------  ------------  ----------  --------------  --------  --------------  ------------- 
 
 

2. SEGMENT ANALYSIS (continued)

 
                                                     Continuing 
                                 -------------------------------------------------- 
26 Weeks ended 28 September           Machine 
 2019                                   Tools 
                                  & Precision  Industrial 
                                   Engineered       Laser     Head Office 
                                   Components     Systems   & unallocated     Total    Discontinued    Group Total 
Segmental analysis of 
 revenue                                 $000        $000            $000      $000            $000           $000 
-------------------------------  ------------  ----------  --------------  --------  --------------  ------------- 
Total revenue                          22,622      13,036               -    35,657             867         36,524 
-------------------------------  ------------  ----------  --------------  --------  --------------  ------------- 
 
Operating profit/(loss) 
 pre adjusting items                    1,661       1,825           (960)     2,526            (73)          2,453 
 Adjusting items                            -           -              96        96            (93)              3 
-------------------------------  ------------  ----------  --------------  --------  --------------  ------------- 
Operating profit/(loss)                 1,661       1,825           (864)     2,622           (166)          2,456 
-------------------------------  ------------  ----------  --------------  --------  --------------  ------------- 
 
Other segmental information: 
Reportable segment assets              51,381      18,359           1,404    71,144             949         72,093 
Reportable segment liabilities       (23,969)     (6,222)        (10,992)  (41,183)               -       (41,183) 
Intangible & Property, 
 plant and equipment additions            204         156               -       360               -            360 
Depreciation and amortisation             494         416              88       998               -            998 
-------------------------------  ------------  ----------  --------------  --------  --------------  ------------- 
 
 
 
                                                        Continuing 
                                  ------------------------------------------------------ 
                                       Machine 
  52 Weeks ended 28 March                tools 
  2020                             & precision 
                                    engineered      Industrial     Head Office 
                                    components   laser systems   & unallocated     Total  Discontinued 
Segmental analysis of revenue             $000            $000            $000      $000          $000  Group Total 
--------------------------------  ------------  --------------  --------------  --------  ------------  ----------- 
Total revenue                           43,511          23,695               -    67,206           830       68,036 
--------------------------------  ------------  --------------  --------------  --------  ------------  ----------- 
 
Segmental analysis of operating 
 profit/(loss) before Adjusting 
 Items                                   3,216           1,689         (2,178)     2,727         (417)        2,310 
--------------------------------  ------------  --------------  --------------  --------  ------------  ----------- 
Adjusting Items                              -           (254)           (933)   (1,187)         (543)      (1,730) 
--------------------------------  ------------  --------------  --------------  --------  ------------  ----------- 
Group operating profit/(loss)            3,216           1,435         (3,111)     1,540         (960)          580 
--------------------------------  ------------  --------------  --------------  --------  ------------  ----------- 
 
Other segmental information: 
Reportable segment assets               35,073          14,164          16,726    65,963             -       65,963 
Reportable segment liabilities        (18,085)         (6,990)        (12,330)  (37,405)             -     (37,405) 
Intangible & Property, 
 plant and equipment additions             368             330             302     1,000             -        1,000 
Depreciation and amortisation              901             883             446     2,230             -        2,230 
 
 

3. Adjusting ITEMS

The directors have highlighted transactions which are material and unrelated to the normal trading activity of the Group.

In the opinion of the directors the disclosure of these transactions should be reported separately for a better understanding of the underlying trading performance of the Group. These underlying figures are used by the Board to monitor business performance, form the basis of bonus incentives and are used for the purposes of the bank covenants.

The items below correspond to the table below;

a) The buy-out of the Group pension scheme was completed in April 2019 and a profit of $0.8m was recorded in the prior year as the amount received was higher than the carrying value of the asset previously recognised.

b) As a result of the outsourcing of manufacturing in the UK in the prior year, the existing premises were vacated and not sub-let; as a result a right of use asset impairment charge of $0.4m was recognised in the prior year, in addition to a provision for associated unavoidable costs, including amortisation and interest under IFRS 16 totaling $0.4m.

c) A credit of $0.022m was recorded in financial income in respect of the final salary pension scheme.

d) The amortisation of the loan note costs and associated costs are shown in financial expense. These are non cash movements and relate to the discounting of the loan notes and associated costs which unwind over the term of the notes.

e) A charge was incurred as a result of the acquisition of Control Micro Systems Inc for legal and professional fees.

f) Amortisation of intangible assets, including customer relationships, acquired through the Control Micro Systems Inc deal.

g) A charge of $0.3m was expensed in cost of sales relating to US duty and tariff charges from prior year.

   h)    Costs in relation to the Group reorganisation. 

i) In the prior year a charge was incurred which included additional costs of the closure of the Gamet business in October 2019 as well as a loss on disposal as a result of receiving less than originally anticipated.

 
                                                     30 September  28 September  2 8 March 
                                                             2020          2019      202 0 
                                                             $000          $000       $000 
---------------------------------------------------  ------------  ------------  --------- 
Items included in c ost of sales : 
US Tariffs & Duty charges relating to prior years 
 (g)                                                            -             -      (254) 
---------------------------------------------------  ------------  ------------  --------- 
                                                                -             -      (254) 
---------------------------------------------------  ------------  ------------  --------- 
Items included in operating profit: 
Unavoidable lease costs (b)                                     -             -     (3 78) 
Right of use impairment (b)                                     -             -     (3 92) 
Restructuring costs (h)                                     (195)             -          - 
Acquisition costs (e)                                           -         (384)      (684) 
Amortisation of acquisition intangibles (f)                 (175)         (322)      (288) 
Pensions legal costs (a)                                        -           (7)          - 
Profit on disposal of pension scheme (a)                        -           809        809 
                                                           (370 )        ( 713)     ( 933) 
---------------------------------------------------  ------------  ------------  --------- 
 
Items included in financial income/(expense): 
Pensions interest on surplus (c)                                -             -        2 2 
Financial income                                                -             -         22 
---------------------------------------------------  ------------  ------------  --------- 
Amortisation of loan notes and associated expenses 
 (d)                                                        (300)         (259)      (536) 
 
 
Total adjusting items before tax                            (670)         (163)    (1,701) 
---------------------------------------------------  ------------  ------------  --------- 
Income tax on adjusting items                                   -         (283)          - 
Total adjusting items after tax                             (670)         (446)    (1,701) 
Loss on discontinued activity (i)                               -          (93)      (543) 
---------------------------------------------------  ------------  ------------  --------- 
 
 

4. Financial income and expensE

 
                                    3 0 September  28 September  28 March 
                                            202 0          2019      2020 
                                             $000          $000      $000 
Bank and other interest                         6             -         5 
Interest on Pension surplus                     -             -        22 
----------------------------------  -------------  ------------  -------- 
Financial income                                6             -        27 
----------------------------------  -------------  ------------  -------- 
Bank overdraft and loan interest            (9 2)        ( 206)    ( 315) 
Loan note interest                         (463 )        (451 )    (918 ) 
Finance charges on finance leases               -           (5)     (12 ) 
Pensions interest on deficit                    -             -     ( 44) 
IFRS 16 - Lease interest                    (191)         (201)     (375) 
Amortisation of loan note costs            (300 )        (259 )     (536) 
Financial expense                        ( 1,046)      ( 1,122)  (2,200 ) 
----------------------------------  -------------  ------------  -------- 
 

5. Taxation

 
                                           3 0 September  28 September  2 8 March 
                                                   202 0          2019    202 0 9 
                                                    $000          $000       $000 
-----------------------------------------  -------------  ------------  --------- 
Current tax: 
Corporation tax at 19% (2019: 19%):                    -             -          - 
Overseas taxation: 
- current period                                       -        ( 155)        151 
-----------------------------------------  -------------  ------------  --------- 
Total current tax charge                               -        ( 155)        151 
-----------------------------------------  -------------  ------------  --------- 
Deferred taxation: 
- current period                                     140        ( 283)        891 
- effect of rate change in UK                          -             -        143 
- prior period                                         -             -         43 
-----------------------------------------  -------------  ------------  --------- 
Total deferred taxation charge                      1 40        ( 283)      1,077 
-----------------------------------------  -------------  ------------  --------- 
Taxation charged to the income statement             140        ( 438)      1,228 
-----------------------------------------  -------------  ------------  --------- 
 

6. Earnings per share

The calculation of the basic earnings per share loss of 0.93c (2019:profit 0.92c) is based on the earnings for the financial period attributable to the Parent Company's shareholders of a loss of $1,098,000 (2019 Profit $1,062,000) and on the weighted average number of shares in issue during the period of 117,473,341 (2019 115,421,143). At 30 September 2020, there were 7,780,000 (2019: 7,500,000) potentially dilutive shares on option and 43,950,000 (2019: 43,950,000) share warrants exercisable at 20p. The weighted average effect of these as at 30 September 2020 was 1,630,000 shares (2019: 2,969,376) giving a diluted earnings per share loss of 0.93c (2019: 0.90c).

 
                                          30 September  2 8 September    28 M arch 
                                                  2020           2019         2020 
----------------------------------------  ------------  -------------  ----------- 
Weighted average number of shares               Shares         Shares       Shares 
                                           117,47 3 ,3 
Issued shares at start of period                    41    112,973,341  112,973,341 
Effect of shares issued in the period 
 (4,500,000 on 21 June 2019)                         -     2 ,447,802   3 ,476,712 
----------------------------------------  ------------  -------------  ----------- 
Weighted average number of shares at 
 end of period                             117,473,341   1 15,421,143  116,450,053 
----------------------------------------  ------------  -------------  ----------- 
Weighted average number of 7,780,000 
 (2019: 7,500,000) potentially dilutive 
 shares                                      1,630,000     2 ,969,376    2,877,486 
----------------------------------------  ------------  -------------  ----------- 
Total Weighted average diluted shares      119,103,341   1 18,390,519  119,327,539 
----------------------------------------  ------------  -------------  ----------- 
 
 
                                                 3 0 September  28 September  28 March 2020 
                                                         202 0          2019 
                                                          $000          $000           $000 
Total post tax earnings - continuing 
 operations                                            (1,098)         1,062           59 5 
Total post tax earnings including discontinued 
 operations                                            (1,098)           896        (36 5 ) 
-----------------------------------------------  -------------  ------------  ------------- 
Basic EPS                                              (0.93c)         0.92c          0.51c 
Diluted EPS                                            (0.93c)         0.90c        0.5 0 c 
-----------------------------------------------  -------------  ------------  ------------- 
Total including discontinued operations 
Basic EPS                                              (0.93c)         0.78c        (0.31c) 
Diluted EPS                                            (0.93c)         0.76c        (0.31c) 
-----------------------------------------------  -------------  ------------  ------------- 
Underlying earnings                                       $000          $000           $000 
-----------------------------------------------  -------------  ------------  ------------- 
Total post tax earnings - continuing 
 operations                                            (1,098)         1,062           59 5 
Adjusting items - per note 3                             (670)         (446)          1,701 
 
Underlying earnings after tax                            (428)         1,508         2,29 6 
-----------------------------------------------  -------------  ------------  ------------- 
Underlying basic EPS                                   (0.36c)         1.24c          1.97c 
Underlying diluted EPS                                 (0.36c)         1.21c          1.92c 
 

7. RECONCILIATION OF NET CASH FLOW TO NET DEBT

 
                                                   3 0 September  28 September  28 March 
                                                            2020          2019      2020 
                                                            $000          $000      $000 
-------------------------------------------------  -------------  ------------  -------- 
Increase/(decrease) in cash and cash equivalents            4 56         1,634     (952) 
                                                                        (4,358 
(decrease)/Increase in debt and finance leases            2 ,345             )     (341) 
-------------------------------------------------  -------------  ------------  -------- 
(decrease)/Increase in net debt from cash flows            2,801      ( 2,724)   (1,293) 
Net debt at beginning of period                         (24,142)      (14,541)  (14,541) 
Effect of IFRS 16 leasing                                  (221)             -   (9,755) 
Cash and debt through acquisition                              -             -     1,451 
Government assistance loans                             ( 3,783)             -         - 
Loan costs amortisation and adjustments                    (305)         (177)     (421) 
Exchange effects on net funds                              (574)           545       491 
-------------------------------------------------  -------------  ------------  -------- 
Net debt at end of period                               (26,224)      (16,897)  (24,142) 
-------------------------------------------------  -------------  ------------  -------- 
 

8. Analysis of net DEBT

 
                                           At  Exchange/                                 At 
                                    2 8 March    Reserve                       30 September 
                                         2020   movement    Other  Cash flows          2020 
                                         $000       $000     $000        $000          $000 
----------------------------------  ---------  ---------  -------  ----------  ------------ 
Cash at bank and in hand                2,755        110        -         456         3,321 
Short term deposits (included 
 within cash and cash equivalents 
 on the balance sheet)                    123          6        -           -           129 
                                        2,878        116        -         456         3,450 
Debt due within one year              (5,414)          -        -       1,172       (4,242) 
Debt due after one year               (2,217)          -        -         307       (1,910) 
Loan Notes due after one year         (9,437)      (439)    (305)           -      (10,181) 
Lease liabilities                     (9,952)      (251)    (221)         866       (9,558) 
Government assistance loans                 -          -  (3,783)           -       (3,783) 
Total                                (24,142)      (574)  (4,309)       2,801      (26,224) 
----------------------------------  ---------  ---------  -------  ----------  ------------ 
 

9. FAIR VALUE

The group considers that the carrying amount of the following financial assets and financial liabilities are

a reasonable approximation of their fair value:

Trade and other receivables

Cash and cash equivalents

Trade and other payables

Loans and other borrowings

10. Principal Risks and Uncertainties

The principal risks and uncertainties affecting the Group remain those set out in the 2020 Annual Report. Those which are most likely to impact the performance of the Group in the remaining period of the current financial year are the continuing issues surrounding the COVID-19 pandemic and Brexit which may result in exposure to increased input costs, supply chain and delivery issues and a downturn in its customers' end markets, particularly in North America and Europe.

11. Post balance sheet events

T he freehold property in Brisbane, Australia, which had been transferred to assets held for sale at the end of the period was subsequently sold for $1.6m on 24 October 2020.

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.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.

END

IR EANALFEPEFFA

(END) Dow Jones Newswires

December 15, 2020 02:00 ET (07:00 GMT)

1 Year 600 Chart

1 Year 600 Chart

1 Month 600 Chart

1 Month 600 Chart
ADVFN Advertorial
Your Recent History
LSE
SIXH
600
Register now to watch these stocks streaming on the ADVFN Monitor.

Monitor lets you view up to 110 of your favourite stocks at once and is completely free to use.

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V:gb D:20210413 06:45:21