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CEPS PLC Half-year Report

27/09/2018 8:25am

UK Regulatory (RNS & others)


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TIDMCEPS

RNS Number : 1335C

CEPS PLC

27 September 2018

27 September 2018

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014 (MAR).

CEPS PLC

(the "Group" or the "Company")

HALF-YEARLY REPORT

The Board is pleased to announce its unaudited half-yearly report for the six months ended 30 June 2018.

CHAIRMAN'S STATEMENT

Unfortunately, there is no getting away from it at the moment as the interminable "Brexit" discussions lumber forward to hopefully some sort of conclusion by the end of March next year.

Until the situation is clarified and we return to "normal" politics and business analysis, every comment from Brussels and counter comment from the Government and the numerous interested parties will dominate the investment and business landscape.

In the meantime, the CEPS Group of companies are getting on with getting on trying to manage in these extraordinary times.

Review of the period

On the face of it the most significant corporate event in the period was Sunline Direct Mail going into administration, but as we said at the time of this unfortunate event the impact on CEPS's balance sheet was effectively neutral and, of course, the removal of a loss-making company going forward is positive for the rest of the Group.

In addition, just before the period end on the 27 June, 3.8m new shares were placed at 35p with my family and two other existing shareholders. Of the net proceeds of GBP1.325m, GBP1m was used to repay the short-term loan that the company had drawn down over the previous year.

As a result of this placing there are now 17m shares in issue.

Financial review

The interim accounts are even more complicated than normal because of the removal of Sunline from the consolidated accounts. The gross profit from continuing operations of GBP3.437m (2017: GBP2.236m) on sales of GBP9.056m (2017: GBP8.497m) is a much healthier 38% (2017: 26%) than the historical comparatives which have been dragged back by the underperformance at Sunline. The profit before tax from continuing operations of GBP346,000 compares to GBP642,000 for the same period last year, when a bank interest refund of GBP123,000 boosted results.

The taxation charge has been inflated by the writing-off of a deferred tax asset. This is a non-cash item and it remains as an unrecognised asset when it can be utilised against profits.

Gearing has been reduced to 14% from 33% for the comparable period last year.

Operational review

Aford Awards

The company has continued its steady progress and with all the vendor loans now repaid the company has commenced repaying the outstanding CEPS acquisition loan notes.

The company has continued to review a number of acquisition opportunities and remains keen to add to its business activities, at the right time and at the right price.

CEM Press

The company has continued to make progress on sales but is currently struggling to produce all the orders it has won during the course of the year on time. The negative impact of this will be felt in the second half.

Again, it is our belief that the business needs to be scaled-up and opportunities are being reviewed to achieve this.

Davies Odell

The company is beginning to make steady progress with sales increasing for the first time in a number of years on the back of the new product development reported a year ago.

The company has been able to reduce the cost of production and has also reduced overheads.

Friedman's

The company has relocated to new premises for the second time in our ownership. The company has doubled its premises and has secured the necessary power supply to continue the development of the company.

The costs of the move have been expensed through the profit and loss account. This explains the reduction in profit in these accounts even though sales have increased.

The move to larger premises and the installation of new machines has increased capacity and also means that the company is able to develop new product areas which will provide the growth in the next few years.

Hickton

Integration of the two companies continues with the harmonisation of systems and the employment of a senior recruit for BRCS based at Hickton's premises in Elsecar. This will further facilitate the alignment of cultures over time.

Against this back-drop both companies continue to perform well. There has been a complete change to the finance function and an IT systems overhaul, the benefits of which will filter through in the second half.

Dividend

With the administration of Sunline Direct Mail, the Board has placed the payment of a dividend on hold for the time being.

Prospects

Despite the Group suffering the loss of Sunline, the Board is confident that the remaining Group companies, as a whole, will make progress over the next year.

David Horner

Chairman

27 September 2018

CEPS PLC

Consolidated Statement of Comprehensive Income

Six months ended 30 June 2018

 
                                      Note    Continuing   Discontinued 
                                              Operations     Operations                             Audited 
                                               Unaudited      Unaudited   Unaudited   Unaudited   12 months 
                                                6 months                   6 months    6 months 
                                                   to 30       6 months       to 30       to 30       to 31 
                                                    June     to 30 June        June        June    December 
                                                    2018           2018        2018        2017        2017 
                                                 GBP'000        GBP'000     GBP'000     GBP'000     GBP'000 
 
 Revenue                               3           9,056          3,118      12,174      12,077      23,601 
 Cost of sales                                   (5,619)        (3,172)     (8,791)     (9,446)    (18,187) 
                                            ------------  -------------  ----------  ----------  ---------- 
 Gross profit/(loss)                               3,437           (54)       3,383       2,631       5,414 
 
 Net operating expenses                          (2,952)          (296)     (3,248)     (1,763)     (4,313) 
                                            ------------  ------------- 
 Operating profit                                    485          (350)         135         868       1,101 
 Exceptional item                                      -             20          20           -       (847) 
                                            ------------  ------------- 
 Adjusted operating profit/(loss)                    485          (330)         155         868         254 
 
 Analysis of adjusted 
  operating profit/(loss) 
                                            ------------  -------------  ----------  ----------  ---------- 
 Trading                                             650          (350)         300       1,036       1,423 
 Exceptional item                      2               -             20          20           -       (847) 
 Group costs                           3           (165)              -       (165)       (168)       (322) 
                                            ------------  -------------  ----------  ----------  ---------- 
                                                     485          (330)         155         868         254 
                                            ------------  -------------  ----------  ----------  ---------- 
 Net finance costs                     3           (139)             21       (118)        (35)       (209) 
 Profit on disposal of 
  investment                                           -              -           -           -          10 
 Profit/(loss) before 
  tax                                                346          (309)          37         833          55 
 Taxation                              3           (180)              -       (180)       (158)       (276) 
                                            ------------  -------------  ----------  ----------  ---------- 
 Profit/(loss) for the 
  period                                             166          (309)       (143)         675       (221) 
                                            ------------  -------------  ----------  ----------  ---------- 
 
 Other comprehensive loss 
 Items that will not be 
  reclassified to profit 
  or loss 
                                            ------------  -------------  ----------  ----------  ---------- 
 Actuarial loss on defined 
  benefit pension plans                                -              -           -           -        (66) 
                                            ------------  -------------  ----------  ----------  ---------- 
 Items that may be subsequently 
  reclassified to profit 
  or loss                                              -              -           -           -           - 
                                            ------------  ------------- 
 Other comprehensive loss 
  for the period, net of 
  tax                                                  -              -           -           -        (66) 
                                            ------------  ------------- 
 Total comprehensive income/(loss) 
  for the period                                     166          (309)       (143)         675       (287) 
                                            ------------  -------------  ----------  ----------  ---------- 
 
 (Loss)/profit attributable 
  to: 
 Owners of the parent                              (419)          (309)       (728)         418       (532) 
 Non-controlling interest                            585              -         585         257         311 
                                            ------------  -------------  ----------  ----------  ---------- 
                                                     166          (309)       (143)         675       (221) 
                                            ------------  -------------  ----------  ----------  ---------- 
 Total comprehensive (loss)/income 
  attributable to: 
 Owners of the parent                              (419)          (309)       (728)         418       (598) 
 Non-controlling interest                            585              -         585         257         311 
                                            ------------  -------------  ----------  ----------  ---------- 
                                                     166          (309)       (143)         675       (287) 
                                            ------------  -------------  ----------  ----------  ---------- 
 Earnings per share attributable 
  to owners of the parent 
  during the period 
 basic and diluted                     4         (3.17)p        (2.34)p     (5.51)p       3.30p     (4.11)p 
                                            ------------  -------------  ----------  ----------  ---------- 
 

CEPS PLC

Consolidated Statement of Financial Position

As at 30 June 2018

 
                                       Note   Unaudited   Unaudited       Audited 
                                                  as at       as at         as at 
                                                30 June     30 June   31 December 
                                                   2018        2017          2017 
                                                GBP'000     GBP'000       GBP'000 
 Assets 
 Non-current assets 
 Property, plant and equipment                    1,121       2,336         2,320 
 Intangible assets                                5,600       6,153         5,600 
 Deferred tax asset                                   5         220           226 
                                                  6,726       8,709         8,146 
                                             ----------  ----------  ------------ 
 
 Current assets 
 Inventories                                      2,287       2,323         1,770 
 Trade and other receivables                      3,561       4,030         3,691 
 Cash and cash equivalents 
  (excluding bank overdrafts)                     1,528       1,369         1,371 
                                                  7,376       7,722         6,832 
                                             ----------  ----------  ------------ 
 
 Total assets                           3        14,102      16,431        14,978 
                                             ==========  ==========  ============ 
 
 Equity 
 Capital and reserves attributable 
  to owners of the parent 
 Called up share capital                4         1,700       1,320         1,320 
 Share premium                                    5,789       4,843         4,843 
 Retained earnings                              (3,284)     (1,506)       (2,556) 
                                             ----------  ----------  ------------ 
                                                  4,205       4,657         3,607 
 Non-controlling interest in equity               1,932       1,371         1,347 
 Total equity                                     6,137       6,028         4,954 
                                             ----------  ----------  ------------ 
 
 Liabilities 
 Non-current liabilities 
 Borrowings                                       1,284       2,504         2,223 
 Trade and other payables                             -           -           313 
 Deferred tax liability                              71          83            71 
 Provisions for liabilities and 
  charges                                             -          50            50 
                                                  1,355       2,637         2,657 
                                             ----------  ----------  ------------ 
 
 Current liabilities 
 Borrowings                                       2,320       3,336         3,503 
 Trade and other payables                         4,253       4,061         3,556 
 Current tax liabilities                             37         307           258 
 Provisions for liabilities and 
  charges                                             -          62            50 
                                                  6,610       7,766         7,367 
                                             ----------  ----------  ------------ 
 
 Total liabilities                                7,965      10,403        10,024 
                                             ----------  ----------  ------------ 
 
 Total equity and liabilities                    14,102      16,431        14,978 
                                             ==========  ==========  ============ 
 

CEPS PLC

Consolidated Statement of Cash Flows

Six months ended 30 June 2018

 
                                                Unaudited   Unaudited       Audited 
                                                 6 months    6 months     12 months 
                                                       to          to            to 
                                                  30 June     30 June   31 December 
                                                     2018        2017          2017 
                                                  GBP'000     GBP'000       GBP'000 
 Cash flows from operating activities 
 Cash generated from operations                     1,439         598         1,765 
 Income tax paid                                        -           -         (229) 
 Interest received                                      -          26           128 
 Interest paid                                      (118)       (158)         (337) 
 Net cash generated from operations                 1,321         466         1,327 
                                               ----------  ----------  ------------ 
 
 Cash flows used in investing activities 
 Acquisition of subsidiary net of cash 
  acquired                                              -       (145)         (444) 
 Purchase of property, plant and equipment          (548)       (170)         (266) 
 Proceeds from sale of assets                           -           -            32 
 Purchase of intangibles                                -         (3)          (11) 
 Increase in interest in subsidiary                     -         (7)           (7) 
 Net cash used in investing activities              (548)       (325)         (696) 
                                               ----------  ----------  ------------ 
 
 Cash flows from financing activities 
 Repayment of borrowings                          (1,157)       (522)         (476) 
 Dividend paid to non-controlling interest              -       (113)         (225) 
 Proceeds from share issue (net of costs)           1,326       1,263         1,263 
 Repayment of capital element of finance 
  leases                                            (265)       (103)         (386) 
 Net cash (used in)/generated from financing 
  activities                                         (96)         525           176 
                                               ----------  ----------  ------------ 
 Net increase in cash and cash equivalents            677         666           807 
 Cash and cash equivalents at the beginning 
  of the period                                       851          44            44 
 Cash and cash equivalents at the end 
  of the period                                     1,528         710           851 
                                               ==========  ==========  ============ 
 Cash generated from/(used in) operations 
 Profit before income tax                              37         833            55 
 Adjustments for: 
 Depreciation and amortisation                        308         268           497 
 Intangible assets written off                          -           -           847 
 Exceptional item                                    (20)           -        - 
 Loss on disposal of property, plant 
  and equipment                                         -           -          (17) 
 Net finance costs                                    118          35           209 
 Operating profit before changes in 
  working capital and provisions                      443       1,136         1,591 
 (Increase)/decrease in inventories                 (517)       (303)           250 
 Decrease/(increase) in trade and other 
  receivables                                         349       (329)            11 
 Increase/(decrease) in trade and other 
  payables                                          1,264          94          (75) 
 Decrease in provisions                             (100)           -          (12) 
 Cash generated from operations                     1,439         598         1,765 
                                               ==========  ==========  ============ 
 Cash and cash equivalents 
 Cash at bank and in hand                           1,528       1,369         1,371 
 Bank overdrafts repayable on demand                    -       (659)         (520) 
                                                    1,528         710           851 
                                               ==========  ==========  ============ 
 

CEPS PLC

Consolidated Statement of Changes in Equity

Six months ended 30 June 2018

 
                                        Share      Share    Retained   Attributable   Non-controlling     Total 
                                      capital    premium    earnings      to owners          interest    equity 
                                                                             of the 
                                                                             parent 
                                      GBP'000    GBP'000     GBP'000        GBP'000           GBP'000   GBP'000 
 At 1 January 2017 
  (audited)                               957      3,943     (1,924)          2,976             1,227     4,203 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Profit for the period                      -          -         418            418               257       675 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Total comprehensive 
  income for the period                     -          -         418            418               257       675 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Proceeds from shares 
  issued net of expenses                  363        900           -          1,263                 -     1,263 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Total contributions 
  by owners of the parent 
  recognised in equity                    363        900           -          1,263                 -     1,263 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Dividend paid to non-controlling 
  interest                                  -          -           -              -             (113)     (113) 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Total transactions 
  recognised directly 
  in equity                                 -          -           -              -             (113)     (113) 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 At 30 June 2017 (unaudited)            1,320      4,843     (1,506)          4,657             1,371     6,028 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Actuarial loss                             -          -        (66)           (66)                 -      (66) 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 (Loss)/profit for 
  the period                                -          -       (950)          (950)                54     (896) 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Total comprehensive 
  (loss)/ income for 
  the period                                -          -     (1,016)        (1,016)                54     (962) 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Changes in ownership 
  interest in a subsidiary                  -          -        (34)           (34)                34         - 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Dividend paid to non-controlling 
  interest                                  -          -           -              -             (112)     (112) 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Total distributions 
  recognised directly 
  in equity                                 -          -        (34)           (34)              (78)     (112) 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 At 31 December 2017 
  (audited)                             1,320      4,843     (2,556)          3,607             1,347     4,954 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 (Loss)/profit for 
  the period                                -          -       (728)          (728)               585     (143) 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Total comprehensive 
  (loss)/income for 
  the period                                -          -       (728)          (728)               585     (143) 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Proceeds from shares 
  issued net of expenses                  380        946           -          1,326                 -     1,326 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 Total contributions 
  by owners of the parent 
  recognised in equity                    380        946           -          1,326                 -     1,326 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 At 30 June 2018 (unaudited)            1,700      5,789     (3,284)          4,205             1,932     6,137 
                                    ---------  ---------  ----------  -------------  ----------------  -------- 
 

Notes to the financial information

   1.    General information 

The Company is a limited liability company incorporated and domiciled in the UK. The address of its registered office is 11 Laura Place, Bath BA2 4BL and the registered number of the company is 00507461.

The Company is listed on AIM.

This condensed consolidated half-yearly financial information was approved by the Directors for issue on 27 September 2018.

This condensed consolidated half-yearly financial information does not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006. Statutory accounts for the year ended 31 December 2017 were approved by the Board of directors on 10 May 2018 and delivered to the Registrar of Companies. The report of the auditors on those accounts was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under section 498 of the Companies Act 2006.

This condensed consolidated half-yearly financial information has not been reviewed or audited.

There is no seasonality or cyclicality in relation to the condensed consolidated half-yearly financial information.

Basis of preparation

This condensed consolidated half-yearly financial information for the six months ended 30 June 2018 has been prepared in accordance with IAS 34, 'Interim Financial Reporting' as adopted by the European Union. The condensed consolidated half-yearly financial information should be read in conjunction with the annual financial statements for the year ended 31 December 2017, which have been prepared in accordance with IFRSs as adopted by the European Union.

Accounting policies

The accounting policies applied are consistent with those of the annual financial statements for the year ended 31 December 2017, as described in those annual financial statements. Where new standards, or amendments to existing standards, have become effective during the year there has been no material impact on the results of the Group.

   2.    Exceptional item 

Sunline Direct Mail Limited

As announced on 13 June 2018, Sunline Direct Mail Limited ("SDM") filed a notice of intention to appoint an administrator. The company went into liquidation on 26 June 2018. The impact of the new General Data Protection Regulation ("GDPR"), as highlighted by the Royal Mail in its recent results where it forecast a severe decline in volumes, coupled with the reaction to the plastics debate prompted by the BBC's Blue Planet Television series, had an impact on the sector. As a result, SDM's order book did not fill at the rate that management would have expected it to at that time of year, being the "golden period" from August to November. As the business was likely to have required significant amounts of additional funding to carry on trading, the CEPS PLC Board made the decision to make no further funding available.

The exceptional item relates to SDM. At 30 June 2018 this is a provisional result as the company is subject to liquidation processes. This will be updated at the year end.

   3.    Segmental analysis 

All activities, apart from those relating to Sunline, are classed as continuing.

The chief operating decision maker of the Group is its Board. Each operating segment regularly reports its performance to the Board which, based on those reports, allocates resources to and assesses the performance of those operating segments.

Operating segments and their principal activities are as follows:

   -     Aford Awards, a sports trophy and engraving company; 
   -     CEM Press, a manufacturer of fabric and wallpaper pattern books, swatches and shade cards; 

- Davies Odell, a manufacturer and distributor of protection equipment, matting and footwear components;

   -     Friedman's, a convertor and distributor of specialist Lycra; 

- Hickton Consultants, a provider of services to the construction industry together with BRCS (Building Consultants), a leading provider of building control services nationally;

   -     Sunline, a supplier of services to the direct mail market (see note 2). 

The United Kingdom is the main country of operation from which the Group derives its revenue and operating profit and is the principal location of the assets of the Group. The Group information provided below, therefore, also represents the geographical segmental analysis. Of the GBP12,174,000

(2017: GBP12,077,000) revenue, GBP10,790,000 (2017: GBP10,735,000) is derived from UK customers.

The Board assesses the performance of each operating segment by a measure of adjusted earnings before interest, tax, depreciation and amortisation and Group costs. Other information provided to the Board is measured in a manner consistent with that in the financial statements.

   i)     Results by segment 

Unaudited 6 months to 30 June 2018

 
 
                          Aford       CEM    Davies                               Continuing   Discon-tinued     Total 
                         Awards     Press     Odell     Friedman's     Hickton    Operations         Sunline     Group 
                        GBP'000   GBP'000   GBP'000        GBP'000     GBP'000       GBP'000         GBP'000   GBP'000 
 Revenue                  1,065     1,245     1,956          2,792       1,998         9,056           3,118    12,174 
                       --------  --------  --------  -------------  ----------  ------------  --------------  -------- 
 Segmental result 
  (EBITDA) before 
  exceptional costs         231      (48)      (16)            358         285           810           (202)       608 
 Exceptional item             -         -         -              -           -                            20        20 
                       --------  --------  --------  -------------  ----------  ------------  --------------  -------- 
 Segmental result 
  (EBITDA) after 
  exceptional 
  costs                     231      (48)      (16)            358         285           810           (182)       628 
                       --------  --------  --------  -------------  ---------- 
 Depreciation and 
  amortisation charge       (4)      (35)      (11)           (60)        (50)         (160)           (148)     (308) 
                       --------  --------  --------  -------------  ---------- 
 Group costs                                                                           (165)               -     (165) 
 Net finance costs                                                                     (139)              21     (118) 
                                                                                ------------  -------------- 
 Profit/(loss) before 
  taxation                                                                               346           (309)        37 
 Taxation                                                                              (180)               -     (180) 
                                                                                ------------  --------------  -------- 
 Profit/(loss) for 
  the period                                                                             166           (309)     (143) 
                                                                                ============  ==============  ======== 
 

Unaudited 6 months to 30 June 2017

 
                                                                                                   Discon- 
                             Aford       CEM    Davies                               Continuing     tinued     Total 
                            Awards     Press     Odell     Friedman's     Hickton    Operations    Sunline     Group 
                           GBP'000   GBP'000   GBP'000        GBP'000     GBP'000       GBP'000    GBP'000   GBP'000 
 Revenue                     1,044     1,204     1,817          2,610       1,822         8,497      3,580    12,077 
                          --------  --------  --------  -------------  ----------  ------------  ---------  -------- 
 Segmental result 
  (EBITDA)                     243      (84)       (5)            486         286           926        378     1,304 
                          --------  --------  --------  -------------  ---------- 
 Depreciation and 
  amortisation charge         (11)      (39)      (39)           (17)        (26)         (132)      (136)     (268) 
                          --------  --------  --------  -------------  ---------- 
 Group costs                                                                              (168)          -     (168) 
 Net finance costs                                                                           16       (51)      (35) 
                                                                                   ------------  --------- 
 Profit before taxation                                                                     642        191       833 
 Taxation                                                                                 (158)          -     (158) 
                                                                                   ------------  ---------  -------- 
 Profit for the period                                                                      484        191       675 
                                                                                   ============  =========  ======== 
 

Audited Year to 31 December 2017

 
 
                          Aford       CEM    Davies                               Continuing   Discon-tinued     Total 
                         Awards     Press     Odell     Friedman's     Hickton    Operations         Sunline     Group 
                        GBP'000   GBP'000   GBP'000        GBP'000     GBP'000       GBP'000         GBP'000   GBP'000 
 Revenue                  1,907     2,414     3,804          5,053       3,748        16,926           6,675    23,601 
                       --------  --------  --------  -------------  ----------  ------------  --------------  -------- 
 Segmental result 
  (EBITDA)                  328     (310)        33          1,198         447         1,696             224     1,920 
                       --------  --------  --------  -------------  ---------- 
 Depreciation and 
  amortisation charge                                                                  (213)           (284)     (497) 
 Goodwill impairment                                                                   (847)               -     (847) 
 Group costs                                                                           (322)               -     (322) 
 Net finance costs                                                                     (107)           (102)     (209) 
 Net profit on 
  disposal 
  of investments                                                                          10               -        10 
                                                                                ------------  -------------- 
 Profit before 
  taxation                                                                               217           (162)        55 
 Taxation                                                                              (276)               -     (276) 
                                                                                ------------  --------------  -------- 
 Loss for the year                                                                      (59)           (162)     (221) 
                                                                                ============  ==============  ======== 
 
   ii)     Assets and liabilities by segment 

Unaudited as at 30 June

 
                   Segment assets      Segment liabilities     Segment net assets/(liabilities) 
                     2018      2017        2018        2017               2018              2017 
                  GBP'000   GBP'000     GBP'000     GBP'000            GBP'000           GBP'000 
 CEPS Group           627       746       (755)       (542)              (128)               204 
 Aford Awards       1,796     1,623       (424)       (419)              1,372             1,204 
 CEM Press          1,928     2,401     (2,286)     (1,907)              (358)               494 
 Davies Odell       1,993     2,007     (1,921)     (1,429)                 72               578 
 Friedman's         4,284     3,741       (999)       (993)              3,285             2,748 
 Hickton            3,474     2,976     (1,580)     (1,675)              1,894             1,301 
 Sunline                -     2,937           -     (3,438)                  -             (501) 
 Total - Group     14,102    16,431     (7,965)    (10,403)              6,137             6,028 
                 ========  ========  ==========  ==========  =================  ================ 
 

Audited as at 31 December 2017

 
                  Segment assets   Segment liabilities         Segment net 
                                                           assets/(liabilities) 
                         GBP'000               GBP'000                  GBP'000 
 CEPS Group                   41               (1,078)                  (1,037) 
 Aford Awards              1,558                 (346)                    1,212 
 CEM Press                 1,400               (1,627)                    (227) 
 Davies Odell              1,974               (1,401)                      573 
 Friedman's                3,860                 (800)                    3,060 
 Hickton                   3,368               (1,942)                    1,426 
 Sunline                   2,777               (2,830)                     (53) 
 Total - Group            14,978              (10,024)                    4,954 
                 ===============  ====================  ======================= 
 
   4.    Earnings per share 

Basic earnings per share is calculated on the loss after taxation for the period attributable to owners of the Company of GBP728,000 (2017: profit of GBP418,000) and on 13,199,940 (2017: 12,659,027) ordinary shares, being the weighted number in issue during the period.

The new shares authorised were not admitted to the AIM market until 3 July 2018. Consequently, the additional 3,800,060 shares have not been included in the EPS calculation.

No adjustment is required for dilution in either period as there are no items that would have a dilutive impact on earnings per share.

   5.    Net debt and gearing 

Gearing ratios at 30 June 2018, 30 June 2017 and 31 December 2017 are as follows:

 
                             Group                            Group 
                         unaudited   Company unaudited    unaudited   Group audited 
                           30 June             30 June      30 June     31 December 
                              2018                2018         2017            2017 
                           GBP'000             GBP'000      GBP'000         GBP'000 
 
 Total borrowings            2,376                 485        3,366           4,103 
 Less: cash and cash 
  equivalents              (1,528)               (304)      (1,369)         (1,371) 
                       -----------  ------------------  -----------  -------------- 
 Net debt                      848                 181        1,997           2,732 
                       -----------  ------------------  -----------  -------------- 
 Total equity                6,137               3,427        6,028           4,954 
                       -----------  ------------------  -----------  -------------- 
 Gearing ratio                 14%                  5%          33%             55% 
 

In order to provide a more meaningful gearing ratio, total borrowings have been revised to be the sum of bank borrowings and third-party debt, excluding loan notes used to finance the Group's acquisitions. The prior period comparatives have also been revised.

   6.       Share capital and premium 
 
                                          Number   Share capital   Share premium      Total 
                                       of shares         GBP'000         GBP'000    GBP'000 
 
 At 1 January 2018                    13,199,940           1,320           4,843      6,163 
 Shares authorised, but not issued     3,800,060             380             950      1,330 
 Transaction costs                             -               -             (4)        (4) 
                                     -----------  --------------  --------------  --------- 
 At 30 June 2018                      17,000,000           1,700           5,789      7,489 
                                     -----------  --------------  --------------  --------- 
 
   7.       Related-party transactions 

The Group has no material transactions with related parties which might reasonably be expected to influence decisions made by users of these financial statements.

During the period the Company entered into the following transactions with its subsidiaries:

 
                                                                                                               Sunline 
                                           Aford                                                                Direct 
                                          Awards     CEM Teal      Davies     Signature      Hickton   Mail (Holdings) 
                                      (Holdings)      Limited       Odell       Fabrics     Holdings           Limited 
                                         Limited     GBP' 000     Limited       Limited      Limited          GBP' 000 
                                         GBP'000                  GBP'000       GBP'000      GBP'000 
 Receipt of equity 
  share dividend 
 - 2018                                        -            -           -             -                              - 
 - 2017                                        -            -           -           137            -                 - 
 - For the year to                             -            -           -           275            -                 - 
  31 December 2017 
  (audited) 
 Receipt/(write-back) 
  of preference share 
  dividend 
 - 2018                                        -            -           -             -            -              (52) 
 - 2017                                        -            -           -             -            -                13 
 - For the year to 
  31 December 2017 
  (audited)                                    -            -           -             -            -                26 
 Receipt/(write-back) 
  of loan note interest 
 - 2018                                       27           48           3             -           24             (125) 
 - 2017                                       28           21           -             -           20                21 
 - For the year to 
  31 December 2017 
  (audited)                                   56           69           7             -           49                93 
 Receipt/(write-back) 
  of management charge 
  income 
 - 2018                                       10            -           8            18            6                 1 
 - 2017                                       10            -           9            18            5                 8 
 - For the year to 
  31 December 2017 
  (audited)                                   20            -          15            35           13                 5 
 Amount owed to the 
  Company 
 
   *    30 June 2018                         618        1,872         194             -          623                 - 
 
   *    30 June 2017                         700        1,066         155             -          627             1,811 
 
  *    31 December 2017 (audited)            700        1,593         153             -          627             2,414 
 
   8.       AIM Compliance Committee 

CEPS PLC is quoted on AIM and, as such, under AIM Rule 31 the Company is required to:

1. have in place sufficient procedures, resources and controls to enable its compliance with the AIM Rules;

2. seek advice from its nominated advisor ("Nomad") regarding its compliance with the AIM Rules whenever appropriate and take that advice into account;

3. provide the Company's Nomad with any information it requests in order for the Nomad to carry out its responsibilities under the AIM Rules for Companies and the AIM Rules for Nominated Advisers

4. ensure that each of the Company's directors accepts full responsibility, collectively and individually, for compliance with the AIM Rules; and

5. ensure that each director discloses without delay all information which the Company needs in order to comply with AIM Rule 17 (Disclosure of Miscellaneous Information) insofar as that information is known to the director or could with reasonable diligence be ascertained by the director.

In order to ensure that these obligations are being discharged the Board has established a committee of the Board (the "AIM Compliance Committee"), chaired by Vivien Langford, an executive director of the Company.

Having reviewed relevant Board papers and met with the Company's Executive Board and the Nomad to ensure that such is the case, the AIM Compliance Committee is satisfied that the Company's obligations under AIM Rule 31 have been satisfied during the period under review.

   9.       Equity Placing 

On 28 June 2018 CEPS PLC successfully placed 3,800,060 new ordinary shares at a price of 35 pence per share to raise GBP1,330,021 (before expenses of GBP4,000) with institutional and private investors. The placing's proceeds were used to repay a loan and for general working capital purposes.

Following the issue of the placing shares on 3 July 2018 (post period end), the enlarged issued share capital of CEPS PLC comprised 17,000,000 ordinary shares of 10 pence each.

Statement of directors' responsibility

The directors confirm that, to the best of their knowledge, these condensed consolidated half--yearly financial statements have been prepared in accordance with IAS 34 as adopted by the European Union. The interim management report includes a fair review of the information required by DTR 4.2.7R and DTR 4.2.8R, namely:

-- an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and

-- material related-party transactions in the first six months of the financial year and any material changes in the related-party transactions described in the last Annual Report.

A list of current directors is maintained on the CEPS PLC Group website: www.cepsplc.com

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

END

IR LIFFDAFIDFIT

(END) Dow Jones Newswires

September 27, 2018 03:25 ET (07:25 GMT)

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