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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Airsprung Group | LSE:APG | London | Ordinary Share | GB0000119940 | ORD 10P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 30.50 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
RNS Number:2773J Airsprung Furniture Group PLC 06 December 2007 AIRSPRUNG FURNITURE GROUP PLC Interim Report and Accounts September 2007 Chairman's statement I am pleased to report that the progress reported at the AGM in September has continued. Sales for the six months ended 30 September 2007 increased by 18% to #24.9 million (2006: #21.1 million). Profit on ordinary activities before taxation rose to #419,000 (2006: #347,000), an increase of 21%. Group cash balances at the half-year end were #2,662,000 (2006: #709,000). All divisions contributed to this further improvement, with the exception of Cavendish, our upholstered furniture operation based in Chorley, which continues to be under pressure due to weakness in its sector. The Group intends to deliver increasing shareholder value from the Cavendish site by introducing selected bed manufacturing, foam conversion and distribution operations closer to our markets in the north of England. The Group has received outline planning permission for Phase 1 of the proposed Brick Lane Business Park adjacent to our main manufacturing site in Trowbridge. The directors are now in a position to review in detail the costs and benefits of various options for developing the central area of this site. A report has been received from the pension scheme actuary showing a further significant reduction in the scheme's deficit from the #6.2 million reported last year end to #4.4 million at the end of the period. Whilst such valuations are always liable to fluctuate, steps are being taken to mitigate investment risk in the light of possible weaknesses in international equity markets. Subject to trading results continuing to improve, the Group's distributable reserves are expected to rise within the foreseeable future to a point where dividend payments can be resumed. As a first step, the board is planning to redeem the preference shares next year with their full entitlement to accrued interest. The uncertainty in financial markets caused a temporary slowdown in sales in the early autumn, but the Group's competitive position in its core activities is strong and there are signs that the normal seasonal trading pattern has been resumed. Although certain raw material prices are now rising, the Group continues to find efficiencies in both purchasing and manufacturing operations. Barring unforeseen circumstances, the directors expect the year end results will be satisfactory. Stuart Lyons CBE Chairman 6 December 2007 For further information, please contact: Tony Lisanti, Chief Executive of Airsprung Furniture Group PLC Tel: 01225 754 411 Mike Coe, Director, Corporate Finance, Blue Oar Securities Plc Tel: 0117 933 0020 Consolidated income statement unaudited 6 months to 6 months to 12 months to 30.09.07 30.09.06 31.03.07 #000 #000 #000 Notes Revenue 24,911 21,146 45,252 Operating costs (24,454) (20,708) (44,261) Operating profit before financing 457 438 991 Finance costs 4 (38) (91) (144) Profit before tax 419 347 847 Income tax (20) - 620 Profit for the period attributable to equity holders of the 399 347 1,467 parent Basic earnings per share 5 1.7p 1.4p 6.1p Diluted earnings per share 5 1.6p 1.4p 5.8p All the above figures relate to continuing operations. Consolidated balance sheet unaudited 30.09.07 30.09.06 31.03.07 #000 #000 #000 Property, plant and equipment 8,614 8,859 8,689 Deferred tax 600 - 620 Total non-current assets 9,214 8,859 9,309 Inventories 3,909 3,402 3,507 Trade and other receivables 7,879 7,230 7,916 Cash and cash equivalents 2,662 709 1,986 Total current assets 14,450 11,341 13,409 Total assets 23,664 20,200 22,718 Called up share capital 2,389 2,389 2,389 Share premium account 2,348 2,348 2,348 Reserves 3,999 3,978 3,989 Retained earnings/(deficit) 683 (3,313) (1,544) Total equity 9,419 5,402 7,182 Obligations under finance leases 15 64 22 Shares classed as financial liabilities - 655 655 Pension scheme deficit 4,379 6,902 6,207 Total non-current liabilities 4,394 7,621 6,884 Trade and other payables 9,196 7,177 8,652 Shares classed as financial liabilities 655 - - Total current liabilities 9,851 7,177 8,652 Total liabilities 14,245 14,798 15,536 Total equity and liabilities 23,664 20,200 22,718 Consolidated cash flow statement unaudited 6 months to 6 months to 12 months to 30.09.07 30.09.06 31.03.07 #000 #000 #000 Profit before tax 419 347 847 Adjustments for: Depreciation 304 326 643 Interest expense 38 91 144 Contributions to defined benefit pension scheme - (65) (138) Charge for share based payments 10 10 21 Profit on sale of tangible fixed assets - - (4) Operating cash flows before movements in working capital 771 709 1,513 (Increase)/decrease in inventories (402) 103 (2) Decrease/(increase) in receivables 37 (165) (866) Increase in payables 540 5 1,451 Cash generated from operations 946 652 2,096 Interest paid (9) (11) (22) Net cash from operating activities 937 641 2,074 Investing activities Interest received 4 18 36 Proceeds on disposal of property, plant and equipment - - 7 Purchase of property, plant and equipment (229) (23) (173) Repayment of loan - 97 112 Net cash (outflow)/inflow from investing activities (225) 92 (18) Financing activities Payment of finance lease liabilities (36) (50) (96) Net cash outflow from financing activities (36) (50) (96) Net increase in cash and cash equivalents 676 683 1,960 Cash and cash equivalents at beginning of period 1,986 26 26 Cash and cash equivalents at end of period 2,662 709 1,986 Consolidated statement of recognised income and expense 6 months to 6 months to 12 months to 30.09.07 30.09.06 31.03.07 #000 #000 #000 Actuarial gain on defined benefit pension scheme 1,828 - 649 Net expense recognised directly in equity 1,828 - 649 Profit for the period 399 347 1,467 Total recognised income and expense for the period 2,227 347 2,116 Notes to the financial statements 1. Basis of preparation 1.1 The interim financial information has not been audited and does not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985. The Group's statutory accounts for the year ended 31 March 2007, prepared under United Kingdom Generally Accepted Accounting Principles (UK GAAP), have been delivered to the Registrar of Companies; the report of the Auditors on these accounts was unqualified and did not contain a statement under Section 237 (2) or (3) of the Companies Act 1985. 1.2 Prior to 31 March 2007 the Group prepared its audited financial statements under UK GAAP. For the year ending 31 March 2008 the Group is required to prepare its annual consolidated financial statements in accordance with accounting standards adopted for use in the European Union (International Financial Reporting Standards (IFRS)). These interim financial statements have been prepared in accordance with the accounting policies set out below, taking into account the requirements and options in IFRS 1 'First-time adoption of International Financial Reporting Standards'. The Group has not adopted the reporting requirements of International Accounting Standard (IAS) 34 'Interim Financial Reporting'. The transition date for the Group's application of IFRS is 1 April 2006 and the comparative figures for 30 September 2006 and 31 March 2007 have been restated accordingly. Reconciliations of the income statement (previously the profit and loss account) and the balance sheet from previously reported UK GAAP to IFRS are shown in note 6. The interim financial statements have been prepared on the historic cost basis, except that derivative financial instruments are stated at their fair value. 2. Accounting policies The accounting policies which follow set out those policies which are expected to apply in preparing the financial statements for the year ending 31 March 2008. These policies have been followed in producing these interim statements. 2.1 Basis of consolidation The consolidated financial statements incorporate the financial statements of Airsprung Furniture Group PLC and its subsidiaries. The Group has elected not to apply IFRS 3 Business Combinations retrospectively to business combinations prior to the date of transition. Accordingly the classification of the combination (acquisition, reverse acquisition or merger) remains unchanged from that used under UK GAAP. Assets and liabilities are recognised at date of transition as if they would be recognised under IFRS, and are measured using their UK GAAP carrying amount immediately post-acquisition as deemed cost under IFRS, unless IFRS requires fair value measurement. 2.2 Goodwill Goodwill representing the excess of the cost of acquisition over the fair value of the Group's share of the identifiable net assets acquired, is capitalised and reviewed annually for impairment. Goodwill is carried at cost less accumulated impairment losses. Negative goodwill is recognised immediately after acquisition in the income statement. Goodwill written off to reserves prior to date of transition to IFRS remains in reserves. There is no reinstatement of goodwill that was amortised prior to transition to IFRS. Goodwill previously written off to reserves is not written back to profit or loss on subsequent disposal. 2.3 Provisions Provisions are recognised when the Group has a present obligation as a result of a past event, and it is probable that the Group will be required to settle that obligation. Provisions are measured as the directors' best estimate of the expenditure required to settle the obligation at the balance sheet date, and are discounted to present value where the effect is material. 2.4 Revenue recognition Revenue is measured as the fair value of the consideration received or receivable and represents amounts receivable for goods and services provided in the normal course of business, net of discounts, allowances and value added tax. Sales of goods are recognised on delivery when the risks and rewards of ownership pass to the customer. 2.5 Foreign currencies In preparing the financial statements of the individual companies, transactions in currencies other than the entity's functional currency (foreign currencies) are recorded at the rates of exchange prevailing on the dates of the transactions. At each balance sheet date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the balance sheet date. Exchange differences arising on the settlement of monetary items, and on the retranslation of monetary items, are included in profit or loss for the period. In order to hedge its exposure to certain foreign exchange risks, the Group enters into forward contracts (see below for details of the Group's accounting policies in respect of such derivative financial instruments). 2.6 Pension costs The defined benefit scheme previously operated by the Group closed to future accrual on 31 May 2006. For this scheme the amounts charged to operating profit are the current service costs and gains and losses on settlements and curtailments. They are included as part of staff costs. Past service costs are recognised immediately in the income statement if the benefits have vested. If the benefits have not vested immediately, the costs are recognised over the period until vesting occurs. The interest cost and the expected return on assets are shown as a net amount of other finance costs or credits. Actuarial gains and losses are recognised immediately in the statement of recognised income and expense. Defined benefit schemes are funded, with the assets of the scheme held separately from those of the Group, in separate trustee administered funds. Pension scheme assets are measured at fair value and liabilities are measured on an actuarial basis using the projected unit method and discounted at a rate equivalent to the current rate of return on a high quality corporate bond of equivalent currency and term to the scheme liabilities. The actuarial valuations are obtained at least triennially and are updated at each balance sheet date. The resulting defined benefit asset or liability is presented separately on the face of the balance sheet. The Group operates a defined contribution pension scheme for employees. The assets of the scheme are held separately from those of the Group. The annual contributions payable are charged to the profit and loss account. 2.7 Taxation Deferred corporation tax is provided, using the liability method, on all temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred tax liabilities are recognised in respect of all temporary differences except where the deferred tax liability arises from the initial recognition of goodwill in business combinations. Deferred tax assets are recognised for all deductible temporary differences, carry forward of unused tax assets and tax losses, to the extent that they are regarded as recoverable. They are regarded as recoverable where, on the basis of available evidence, there will be suitable taxable profits against which the future reversal of the underlying temporary differences can be deducted. The carrying value of the amount of deferred tax assets is reviewed as at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all, or part, of the tax asset to be utilised. Deferred corporation tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on the tax rates (and tax laws) that have been substantively enacted at the balance sheet date. The effect of the proposals to phase out industrial buildings allowances from 1 April 2008 onwards would be to decrease the deferred tax asset and thus the profit and loss by #300,000 2.8 Property, plant and equipment Property, plant and equipment are held at cost, net of depreciation less any provision for impairment. Depreciation is provided by the straight line method at rates calculated to write off the cost of the assets, other than freehold land, less their estimated residual value over their expected useful lives: Freehold land Nil Freehold buildings 21/2 % per annum Plant and vehicles 10% to 20% per annum Computer equipment 331/3 % per annum 2.9 Impairment of tangible and intangible assets excluding goodwill At each balance sheet date, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. The recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risk specific to the asset for which the estimates of future cash flows have not been adjusted. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised as an expense immediately. Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior years. A reversal of an impairment loss is recognised as income immediately. 2.10 Inventories Inventories are stated at the lower of cost and net realisable value. Cost on a first-in, first-out basis comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. Net realisable value represents the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution. 2.11 Trade receivables Trade receivables are measured subsequent to initial recognition at amortised cost using the effective interest method, less provision for impairment. Any change in their value through impairment or reversal of impairment is recognised in the income statement. Provision against trade receivables is made when there is objective evidence that the Group will not be able to collect all amounts due to it in accordance with the original terms of those receivables. The amount of the write -down is determined as the difference between the asset's carrying amount and the present value of estimated future cash flows. 2.12 Leased assets In accordance with IAS 17, the economic ownership of a leased asset is transferred to the lessee if the lessee bears substantially all the risks and rewards related to the ownership of the leased asset. The related asset is recognised at the time of inception of the lease at the fair value of the leased asset or, if lower, the present value of the minimum lease payments plus incidental payments, if any, to be borne by the lessee. A corresponding amount is recognised as a finance leasing liability. The interest element of leasing payments represents a constant proportion of the capital balance outstanding and is charged to the income statement over the period of the lease. All other leases are regarded as operating leases and the payments made under them are charged to the income statement on a straight line basis over the lease term. Lease incentives are spread over the term of the lease. 2.13 Derivative financial instruments The Group's activities expose it primarily to the financial risks of changes in foreign currency exchange rates. The Group uses foreign exchange forward contracts to hedge this exposure. The Group does not use derivative financial instruments for speculative purposes. Changes in the fair value of derivative financial instruments that are designated and effective as hedges of future cash flows are recognised directly in equity and the ineffective portion is recognised immediately in the income statement. Amounts deferred in equity are recognised in the income statement in the same period in which the hedged item affects net profit or loss. Changes in the fair value of derivative financial instruments that do not qualify for hedge accounting are recognised in the income statement as they arise. Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, or exercised, or no longer qualifies for hedge accounting. At that time, any cumulative gain or loss on the hedging instrument recognised in equity is retained in equity until the forecasted transaction occurs. 2.14 Share-based payments The Group has applied the requirements of IFRS 2 'Share-based Payment'. In accordance with the transitional provisions, IFRS 2 has been applied to all grants of equity instruments that were unvested at 1 April 2006. The Group issues equity-settled and cash-settled share-based payments to certain employees (including directors). Equity-settled share-based payments are measured at fair value (excluding the effect of non market-based vesting conditions) at the date of grant. The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the Group's estimate of shares that will eventually vest. Fair value is measured by use of the Black Scholes model. The expected life used in the model has been adjusted, based on management's best estimate, for the effects of non-transferability, exercise restrictions, and behavioural considerations. 2.15 Segmental reporting Activities are allocated to one business segment being furniture. A business segment is a group of assets and operations engaged in providing products or services that are subject to risks and returns that are different from those of other business segments. A geographical segment is engaged in providing products or services within a particular economic environment that is subject to risks and returns which are different from those segments operating in other economic environments. 3. Geographical segments The following table provides an analysis of the Group's revenue by geographical market, irrespective of the origin of the products: 6 months to 6 months to 12 months to 30.09.07 30.09.06 31.03.07 #000 #000 #000 United Kingdom 24,723 20,868 44,702 Rest of the world 188 278 550 24,911 21,146 45,252 4. Finance costs 6 months to 6 months to 12 months to 30.09.07 30.09.06 31.03.07 #000 #000 #000 Interest receivable 4 18 36 Interest paid (9) (11) (22) Finance charge on shares classed as financial (33) (33) (66) liabilities Interest charge on pension scheme liability - (65) (92) (38) (91) (144) 5. Earnings per share The earnings per share are calculated on profit after tax of #399,000 (2006: #347,000) and the weighted average number of ordinary shares of 23,888,698 (2006: 23,888,698) in issue during the period. The share options in existence during the six months ended 30 September 2007 have a dilutive effect. The diluted earnings per share are calculated on earnings of #399,000 (2006: #347,000) and the weighted average number of ordinary shares in issue adjusted to assume conversion of all dilutive potential ordinary shares which is 25,448,698 (2006: 25,418,698). 6. Explanation of transition to IFRS As explained in note 1, these are the Group's first interim financial statements prepared for part of the first year in which financial statements will be prepared in accordance with International Financial Reporting Standards (IFRS). The accounting policies in note 2 have been applied in preparing these interim financial statements, and in preparing an opening IFRS balance sheet as at 1 April 2006 (the Group's date of transition). There are no changes to profit, total assets, total equity or total liabilities as the result of the transition from UK GAAP to IFRS. This information is provided by RNS The company news service from the London Stock Exchange END IR ILFSRFLLEIID
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