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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Alpha Airports | LSE:AAP | London | Ordinary Share | GB0000281328 | 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% | 109.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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RNS No 3289h
ALPHA AIRPORTS GROUP PLC
25th September 1997
Results for the Six Months Ended 31 July 1997 (Unaudited)
HIGHLIGHTS
* Group turnover up 5.8% to #341.9m (1996/97: #323.2m)
* Profit on ordinary activities before taxation up 40% to #14.0m*
(1996/97: #10.0m)
* Adjusted earnings per share up 16.5% at 5.58p (1996/97: 4.79p)
* Interim dividend increased by 5% to 1.84p (1996/97: 1.75p)
* Net debt reduced by #18.0m to #73.4m since 31 July 1996
* Interest cover increases to 6.2 times (1996/97: 4.3 times)
* Kevin Abbott appointed Chief Executive Officer; joins the Group on
1st October 1997
Rodney Galpin, Chairman, commented:
"ALPHA has significantly improved operational performance with pre-tax profits
up 40%. The Group continues to expand internationally with contract awards in
Italy, Hong Kong and USA."
*Including exceptional profit on sale of current asset investment of #0.7m.
For further information, please contact:
Rodney Galpin, Chairman
Stuart Siddall, Finance Director
ALPHA Airports Group Plc (Today) Tel: 0171 457 2345
(Thereafter) Tel: 0181 754 7600
Marc Popiolek
Fiona Grant Duff
Gavin Anderson & Company Tel: 0171 457 2345
CHAIRMAN'S STATEMENT
Overview
As I indicated at the AGM in June we have seen growth in the sales (excluding
businesses discontinued in 1996) of all three core businesses. I am pleased
to report that our results reflect this progress with pre-tax profits up 40%
to #14m (1996/97: #10m) and adjusted earnings per share up 16.5% to 5.58p
(1996/97: 4.79p).
The Group continues to move ahead with its strategy to expand internationally
with contract awards in Italy, Hong Kong and USA. This overseas development
will help counter the progressive reduction in both our management fees from
BAA (given its decision to take control of the retail outlets which we manage
on its behalf during 1998 and 1999) and in our sales at UK Regional Airports
following the anticipated abolition of duty free allowances for the EU
traveller in 1999.
ALPHA Catering Services has reported a 44% rise in profits following the
restructuring measures taken over the past 12 months. Our UK and Australian
businesses have performed well but European catering operations continue to
experience reduction of volume.
ALPHA Ground Services has seen continued sales growth and will be operating
its first European contract from the Autumn. In addition we have been very
active in pursuing the overseas developments of this division, with several
bids awaiting decisions.
In the first half the Group has strengthened its financial position with a
further reduction in debt (down #4.7m) to #73.4m; this has resulted in an
increase in interest cover to 6.2 times.
These results support the Board's decision to increase the interim dividend by
5% to 1.84p. This dividend with a scrip alternative, will be payable on 19th
November 1997 to shareholders on the Register as at 10 October 1997.
ALPHA Catering Services
Sales #104.1m (1996/97: #99.8m excluding discontinued businesses); operating
profit #6.2m (1996/97: #5.9m excluding discontinued businesses).
UK sales have grown by 11% to #87.1m. The number of meals served in the UK
has increased by 14.5% to 18.6m. This growth has come from new business,
expansion by existing customers within our kitchen network and an increase in
overall passenger numbers. We have benefited from this growth due to
initiatives taken since the latter part of 1996 to strengthen the
business. As expected prices and margins remain under pressure.
Internationally the Australian business reported improved results. Sales in
our European businesses declined by 10% (#1.4m) due to movement of airlines
from Orly to Charles de Gaulle and to increased competition in Amsterdam.
Progress has been made to reduce costs in both operations since we do not
anticipate a significant change in the trading environment.
ALPHA Retail Services
Sales #184.2m (1996/97: #163.5m); operating profit #6.8m (1996/97: #5.1m).
Overall sales have increased by 12.7%. In the UK our regional duty
free airport businesses have benefited from an increase of 12.6% in passengers
passing through the airports in which we operate. In addition, we have
secured a further rise in the spend per passenger. As a result, sales in the
UK regional duty free business have risen by over 19%.
Our management contracts at Heathrow and Gatwick have seen more modest growth
with the strength of Sterling taking its toll on spend levels.
Overseas sales have increased from #2.8m to #10.6m following the opening of
the concessions in Sanford (Florida) and Sri Lanka in April 1996 and May 1996
respectively. Further sales growth is expected with the recent opening of our
duty free shops in Orlando and a National Geographic shop in Washington.
Operating profits in ALPHA Retail Services were up #1.7m to #6.8m (1996/97:
#5.1m). The results for the first half benefited from a significant
contribution from the new overseas retail operations and the Eurohub disposal.
In addition we continued to develop our regional airport activities in the UK
and saw profits within the UK regional duty free business grow. These
improvements were offset, partially, by an increase in overseas business
development expenditure (#0.5m) and an increased loss in ALPHA On Board Sales
and Services (up #0.3m to #0.6m) where it is taking longer than anticipated to
build this business.
ALPHA Retail's joint venture with King Power has, with the award of 12 shops
in the new Chek Lap Kok airport in Hong Kong, secured a significant presence
at this major international airport. These shops comprise packaged food,
general merchandise, sports footwear, music and two Harrods signature shops.
ALPHA Ground Services
Sales #53.6m (1996/97: #50.4m); operating profits #3.7m (1996/97: #3.6m).
ALPHA Ground Services reported a 6% rise in sales in sterling terms in spite
of the 7% decline in the US dollar against sterling since the first half of
last year.
Operating profits at #3.7m (1996/97: #3.6m) were held back by the increased
level of international business development expenditure and the strength of
sterling.
ALPHA Ground Services has won more business than it has lost in the half year.
Several contracts were lost because our international customers formed
alliances with US domestic or other airlines. In these cases the domestic
airline takes over the ground handling for the partner airline. ALPHA Ground
Services, nevertheless, remains in a strong position. It has seen growth in
its cargo/mail handling activities, has recently secured a fueling contract in
Washington and expects to see further expansion of these activities in the
USA.
In October we are due to commence our first European ground handling operation
through a joint venture in Italy and we are pursuing several other
opportunities.
In the Far East and Australia we have formed alliances with local partners to
bid for ground services business.
Management
We welcome the arrival in October of Kevin Abbott as the Group's new Chief
Executive. With the other executive appointments over the past 18 months,
ALPHA now has an experienced and enthusiastic team to take the Group
forward.
Outlook
The increased level of passengers travelling through the airports in which we
operate in the UK is expected to continue into 1998. Consequently, we should
see good performance from the UK businesses of both ALPHA Catering Services
and ALPHA Retail Services in the second half of the year.
We continue to progress the development of our regional airport activities,
thus reducing the impact of the changes that are likely to occur over the next
two years. As a result of start ups and increased international business
development costs, we expect earnings from ALPHA Retail's overseas businesses
to be similar to the level achieved in 1996/97.
We expect that trading in the second half of the year in ALPHA Ground Services
will benefit from the usual seasonal upswing. The development of ALPHA Ground
Services out of its domestic US market should ensure the continued growth and
development of the core businesses of ground handling, cargo/mail and fueling.
Rodney Galpin
25 September 1997
GROUP PROFIT AND LOSS ACCOUNT (Unaudited)
Six months Six months
ended ended Year ended
31 July 31 July 31 Jan
Notes 1997 1996 1997
#m #m #m
Turnover
- Continuing operations 341.9 313.7 650.4
- Discontinued operations - 9.5 14.5
------- ------- -------
Total Turnover 2 341.9 323.2 664.9
Cost of sales (199.3) (190.1) (388.3)
------- ------- -------
Gross Profit 142.6 133.1 276.6
Administration and other costs (126.6) (120.3) (249.3)
Other operating income -
exceptional profit on sale of
current asset investment 0.7 - -
------- ------- -------
Operating profit 16.7 12.8 27.3
Income from interest in
associated undertakings - 0.2 0.3
------- ------- -------
Profit on ordinary activities 2 16.7 13.0 27.6
before exceptional loss
analysed between:
- Continuing operations 16.7 14.6 31.0
- Discontinued operations - (1.6) (3.4)
Exceptional loss
Loss on disposal of
discontinued operations - - (2.8)
Related goodwill previously
written off to reserves - - (11.4)
------- ------- -------
Profit on ordinary activities
before interest 16.7 13.0 13.4
Interest receivable 0.3 0.3 0.7
Interest payable (3.0) (3.3) (6.3)
------- ------- -------
Profit on ordinary activities
before taxation 14.0 10.0 7.8
Taxation on profit on ordinary
activities (3.2) (3.3) (6.8)
------- ------- -------
Profit on ordinary activities
after taxation 10.8 6.7 1.0
Minority interest (equity) (0.7) (0.2) (1.0)
------- ------- -------
Profit for the financial
period 10.1 6.5
Dividends 3 (3.1) (2.9) (8.8)
------- ------- -------
Retained profit/(loss) for
the period 7.0 3.6 (8.8)
------- ------- -------
Net earnings per share 4 6.00p 3.85p -
IIMR headline earnings per share 4 6.00p 3.85p 8.37p
Adjusted earnings per share 4 5.58p 4.79p 10.16p
------- ------- -------
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
Profit for the financial period 10.1 6.5 -
Currency translation differences on
foreign currency net investment (1.4) (0.7) (2.3)
------ ------ ------
Total recognised gains and losses
for the period 8.7 5.8 (2.3)
------ ------ ------
There are no differences between the reported results for the current
and prior periods and the results for those periods restated on an
historical basis.
GROUP BALANCE SHEET (Unaudited)
31 July 31 July 1996 31 Jan 1997
1997 As restated
#m #m #m
Fixed Assets
Tangible assets 85.9 95.8 86.3
Investments 0.4 1.1 0.4
------ ------ ------
86.3 96.9 86.7
------ ------ ------
Current assets
Stocks 32.2 26.1 23.3
Debtors 58.1 63.8 50.1
Investments - - 0.5
Cash at bank and in hand 5.5 5.5 7.4
------ ------ ------
95.8 95.4 81.3
------ ------ ------
Creditors: amounts falling due within
one year
Bank and other borrowings (5.7) (6.7) (6.0)
Other creditors (99.7) (91.7) (85.7)
------ ------ ------
(105.4) (98.4) (91.7)
------ ------ ------
Net current (liabilities) (9.6) (3.0) (10.4)
------ ------ ------
Total assets less current liabilities 76.7 93.9 76.3
------ ------ ------
Creditors: amounts falling due after
more than one year
Bank and other borrowings (70.2) (86.4) (76.0)
Other creditors (4.2) (6.2) (2.6)
------ ------ ------
(74.4) (92.6) (78.6)
------ ------ ------
Provision for liabilities and charges (4.4) (6.2) (5.7)
------ ------ ------
Total net (liabilities) (2.1) (4.9) (8.0)
------ ------ ------
Capital and reserves
Called up share capital 16.8 16.8 16.8
Share premium account 38.5 38.1 38.2
Profit and loss account 32.0 20.8 26.4
Other reserves (91.9) (82.9) (91.9)
------ ------ ------
Shareholders' funds (4.6) (7.2) (10.5)
Minority interests (equity) 2.5 2.3 2.5
------ ------ ------
Total equity (2.1) (4.9) (8.0)
------ ------ ------
As permitted by the requirements of FRS4, bank loans under the
revolving credit facility are treated as repayable within two to five
years. The prior figures at 31 July 1996 have been restated
accordingly.
GROUP CASH FLOW STATEMENT (Unaudited)
Six months Six months Year
ended ended ended
31 July 31 July 31 Jan
1997 1996 1997
As
restated
#m #m #m
Net cash inflow from operating activities 21.9 23.1 46.3
------ ------ ------
Returns on investment and servicing
of finance
Interest received 0.3 0.3 0.7
Interest paid (2.7) (2.8) (5.7)
Interest element of finance lease rental (0.1) (0.1) (0.3)
payments
Dividends received from associates - 0.1 0.3
Dividends paid to minority shareholders (1.1) - (0.1)
in subsidiary undertakings ------ ------ ------
Net cash outflow for returns on
investments (3.6) (2.5) (5.1)
and servicing of finance ------ ------ ------
Taxation (1.0) (2.5) (6.7)
------ ------ ------
Capital expenditure
Purchase of tangible fixed assets (7.7) (8.3) (13.7)
Sale of plant and machinery - 0.1 0.2
------ ------ ------
Total capital expenditure (7.7) (8.2) (13.5)
------ ------ ------
Acquisitions and disposals
Sale of business - - 5.0
Investment in associated undertakings - (0.7) -
Purchase of subsidiaries - (10.6) (12.0)
------ ------ ------
Total acquisitions and disposals - (11.3) (7.0)
------ ------ ------
Equity dividends paid (5.9) (5.4) (8.4)
------ ------ ------
Net cash inflow/(outflow) before 3.7 (6.8) 5.6
financing ------ ------ ------
Financing
Issue of ordinary share capital 0.3 0.2 0.3
Debt due beyond a year
- New unsecured loan repayable in 1999 - 6.8 2.7
- New unsecured loan repayable in 2000 - 5.6 10.0
Repayment of external borrowings (5.1) - (9.2)
Capital element of finance lease payments (0.4) (0.4) (0.9)
------ ------ ------
Net cash (outflow)/inflow from financing (5.2) 12.2 2.9
------ ------ ------
Increase/(decrease) in cash (1.5) 5.4 8.5
------ ------ ------
This statement has been presented in accordance with FRS1 (revised).
The prior year figures for the six months ended July 1996 have been
restated to reflect this presentation.
NOTES TO THE CASH FLOW STATEMENT
Reconciliation of operating Six months Six months Year
profit to net cash inflow/(outflow) ended ended ended
from operating activities 31 July 31 July 31 Jan
1997 1996 1997
#m #m #m
Operating profit before sale of current
asset investment 16.0 12.8 27.3
Exceptional profit on sale of current
asset investment 0.7 - -
------ ------ ------
Operating profit 16.7 12.8 27.3
Depreciation 5.9 6.3 12.6
Increase in stocks (9.0) (4.6) (2.1)
(Increase)/decrease in debtors (8.6) (12.4) 0.5
Increase in creditors 16.9 21.0 8.0
------ ------ ------
Net cash inflow from operating
activities 21.9 23.1 46.3
------ ------ ------
RECONCILIATION OF NET DEBT
Six months Six months Year
ended ended ended
31 July 31 July 31 Jan
1997 1996 1997
#m #m #m
(Decrease)/increase in cash in the period (1.5) 5.2 8.5
Decrease/(increase) in debt and lease 5.5 (12.0) (2.6)
financing ------ ------ ------
Change in net debt from cash flows 4.0 (6.8) 5.9
Finance leases - (0.1) (0.2)
Translation differences 0.7 0.4 1.1
------ ------ ------
Movements in net debt in period 4.7 (6.5) 6.8
Opening net debt (78.1) (84.9) (84.9)
------ ------ ------
Closing net debt (73.4) (91.4) (78.1)
------ ------ ------
RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
Six months Six months Year
ended ended ended
31 July 31 July 31 Jan
1997 1996 1997
#m #m #m
Profit for the financial year 10.1 6.5 -
Dividends (3.1) (2.9) (8.8)
------ ------ ------
Retained (loss)/profit for the
financial period 7.0 3.6 (8.8)
Issue of additional share capital to
shareholders 0.3 0.2 0.3
Other recognised (losses) relating to
the period (1.4) (0.7) (2.3)
Amount written back in respect of
goodwill written off to profit and
loss account - - 11.4
Goodwill on acquisitions - (12.3) (13.1)
------ ------ ------
Net increase/(decrease) to
shareholder's funds 5.9 (9.2) (12.5)
Opening shareholder's funds (10.5) 2.0 2.0
------ ------ ------
Closing shareholder's funds (4.6) (7.2) (10.5)
------ ------ ------
NOTES TO THE FINANCIAL INFORMATION
1. Basis of accounting
The consolidated interim financial statements have been
prepared under the historical cost convention and in
accordance with applicable accounting and financial
reporting standards. The accounting policies are the same
as those set out in the financial statements of the Group
for the year ended 31 January 1997.
The interim financial statements are unaudited but have
been reviewed by the auditors and their reports to the
Directors is set out on page 12. The comparative figures
for the year to 31 January 1997 have been extracted from
the Group's financial statements which have been delivered
to the Registrar of Companies. The auditor's report on
those statements was unqualified and did not include a
statement under Section 237(2) or (3) of the Companies Act
1985.
2. Segmental analysis Six months Six months Year
ended ended ended
31 July 31 July 31 Jan
1997 1996 1997
#m #m #m
(a) Turnover
Business sector analysis
ALPHA Catering Services 104.1 109.3 215.1
analysed between
- Continuing operations 104.1 99.8 200.6
- Discontinued operations - 9.5 14.5
ALPHA Retail Services 184.2 163.5 346.0
ALPHA Ground Services 53.6 50.4 103.8
------- ------- -------
Total turnover 341.9 323.2 664.9
------- ------- -------
Geographical analysis
United Kingdom 260.8 238.6 491.7
USA 57.7 60.7 121.2
analysed between
- Continuing operations 57.7 51.2 106.7
- Discontinued operations - 9.5 14.5
Rest of the world 23.4 23.9 52.0
------- ------- -------
Total turnover 341.9 323.2 664.9
------- ------- -------
(b) Profit before taxation
Business sector analysis
ALPHA Catering Services 6.2 4.3 7.6
analysed between
- Continuing operations 6.2 5.9 11.0
- Discontinued operations - (1.6) (3.4)
ALPHA Retail Services 6.8 5.1 12.1
ALPHA Ground Services 3.7 3.6 7.9
------- ------- -------
16.7 13.0 27.6
Exceptional loss on discontinued - - (14.2)
operations ------- ------- -------
16.7 13.0 13.4
Net interest (2.7) (3.0) (5.6)
------- ------- -------
Profit on ordinary activities 14.0 10.0 7.8
before taxation ------- ------- -------
Geographical analysis
United Kingdom 9.9 9.4 17.9
USA 3.8 1.5 4.4
analysed between
- Continuing operations 3.8 3.1 7.8
- Discontinued operations - (1.6) (3.4)
Rest of the world 3.0 2.1 5.3
------- ------- -------
16.7 13.0 27.6
Exceptional loss on discontinued - - (14.2)
operations ------- ------- -------
16.7 13.0 13.4
Net interest (2.7) (3.0) (5.6)
------- ------- -------
Profit on ordinary activities 14.0 10.0 7.8
before taxation ------- ------- -------
3. Dividends
An interim dividend of 1.84 pence (31 July 1996: 1.75
pence) per ordinary share will be paid on 19 November 1997
to shareholders on the register at the close of business on
10 October 1997.
Profit/(loss) for Earnings per share
the period
4. Earnings per share 31 July 31 July 31 Jan 31 31 31
1997 1996 1997 July July Jan
#m #m #m 1997 1996 1997
Pence Pence Pence
Profit for the financial
period and net earnings
per share 10.1 6.5 - 6.00 3.85 -
Adjusted for losses
on disposal
of discontinued
operations - - 14.2 - - 8.45
Taxation relating to - - (0.2) - - (0.08)
these items ------ ------ ------ ------ ----- -----
Adjusted profit
and IIMR headline
earnings per share 10.1 6.5 14.0 6.00 3.85 8.37
Adjusted for exceptional
profit on sale of
current asset investment (0.7) - - (0.42) - -
Adjusted for discontinued
operations operating loss - 1.6 3.4 - 0.96 2.03
Taxation relating to - (0.1) (0.4) - (0.02) (0.24)
these items ------ ------ ------ ------ ----- -----
Adjusted profit and
adjusted 9.4 8.0 17.0 5.58 4.79 10.16
earnings per share
------ ------ ------ ------ ----- -----
Weighted average number of shares in issue during the six months
to July 1997 were 167,896,429 (31 July 1996: 167,587,457 and 31
January 1997: 167,680,423).
Net earnings per ordinary share are calculated by dividing the
profit for the financial year by the weighted average number of
shares in issue during the period. An additional measure of
earnings per share has been recommended by the institute of
Investment Management and Research (IIMR). The IIMR headline
earnings require the adjustment of standard earnings to eliminate
certain items, adjusted for any tax effect. The comparative
earnings per share for the six months to July 1996 have been
restated accordingly. Finally, we have adjusted the IIMR headline
earnings per share to arrive at an adjusted earnings per share by
eliminating the effect of exceptional profit on sale of current
asset investment and results of discontinued operations, adjusted
for any tax effect.
5. Related party transactions
In addition to the ongoing business relations described in
the ALPHA Group's Annual Report 1996/97, the ALPHA Group
has signed a commission agreement with Mr R S Jayawardena,
who occupies a senior position in the ALPHA Group, to
develop business and provide support for ALPHA activities
performed in the Indian Sub-Continent. For the period to
31 July 1997 #57,000 is payable.
6. Approval of financial statement
The financial statements were approved by a committee of
the Board of Directors on 25 September 1997.
Report to the Directors of ALPHA Airports Group Plc by the Auditors
We have reviewed the interim financial statements for the six months ended 31
July 1997 set out on pages 5 to 11 which are the responsibility of, and
have been approved by, the Directors. Our responsibility is to report
on the results of our review.
Our review was carried out having regard to the Bulletin "Review of Interim
Financial Information" issued by the Auditing Practices Board. This
review consisted principally of applying analytical procedures to the
underlying financial data, assessing whether accounting policies have
been consistently applied, and making enquiries of Group management
responsible for financial and accounting matters. The review excluded
audit procedures such as tests of controls and verification of assets
and liabilities and was therefore substantially less in scope than an
audit performed in accordance with Auditing Standards. Accordingly,
we do not express an audit opinion on the interim financial
statements.
On the basis of our review:
- in our opinion the interim financial statements have been
prepared using accounting policies consistent with those adopted
by ALPHA Airports Group Plc in its financial statements for the
year ended 31 January 1997; and
- we are not aware of any material modifications that should be
made to the interim financial statements as presented.
Price Waterhouse
Chartered Accountants
London
25 September 1997
END
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