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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Clipper Logistics Plc | LSE:CLG | London | Ordinary Share | GB00BMMV6B79 | ORD 0.05P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 837.00 | 834.00 | 836.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMCLG
RNS Number : 5972J
Clipper Logistics plc
06 December 2018
CLIPPER LOGISTICS PLC
INTERIM RESULTS FOR THE SIX MONTHS TO 31 OCTOBER 2018
Clipper Logistics plc ("Clipper", "the Group", or "the Company"), a leading provider of value-added logistics solutions and e-fulfilment and returns management services to the retail sector, is pleased to announce its unaudited results for the six months ended 31 October 2018 ("H1 FY19").
Financial Highlights
Hot Features
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-- Group revenue up 14.1% to GBP227.9 million (six months ended 31
October 2017 ("H1 FY18"): GBP199.7 million).
-- Group EBIT 16.1% ahead at GBP10.7 million (H1 FY18: GBP9.2 million),
as a result of strong performance in e-fulfilment and returns management
in particular. By segment:
o E-fulfilment and returns management services EBIT up 17.1% to
GBP6.2 million (H1 FY18: GBP5.3 million), including GBP(0.7)
million impact from Clicklink (H1 FY18: GBP(0.7) million). Post
period-end, Clicklink rate enhancements agreed with key customers
and onboarding of secured new customers will enhance profitability
in the second half and beyond;
o Non e-fulfilment logistics EBIT up 16.4% to GBP7.3 million (H1
FY18: GBP6.3 million), including property-related advisory fees
of GBP2.8 million (H1 FY18: GBPnil). EBIT excluding property-related
advisory fees has reduced, due in particular to lower activity
levels on a closed-book contract with a key retailer as it re-shapes
and restructures its network, together with lower tobacco activity.
Recent contract wins and increased tobacco activity are expected
to deliver earnings growth in the second half; and
o Commercial vehicles EBIT down 36.9% to GBP0.9 million (H1 FY18:
GBP1.4 million) due to lower sales of new vehicles.
-- Group Profit Before Tax and Amortisation(1) up 17.3% to GBP9.9 million
(H1 FY18: GBP8.4 million).
-- Group Profit Before Tax (PBT) up 16.9% to GBP9.3 million (H1 FY18:
GBP7.9 million).
-- Cash generated from operations of GBP10.1 million (H1 FY18: GBP12.6
million).
-- Earnings per share up 14.3% to 7.2 pence (H1 FY18: 6.3 pence).
-- Interim dividend increased by 14.3% to 3.2 pence per share (H1 FY18:
2.8 pence).
(1) As defined in Alternative Performance Measures section
Operational Highlights
-- Commencement of a new e-fulfilment operation for Pretty Little Thing
in Sheffield. Having launched in July 2018, the site is now fully
operational.
-- Continuing organic growth on e-fulfilment operations with longstanding
customers including Asda, ASOS and Wilko, as well as growth on recent
contract wins including Browns and Silkfred.
-- Progressed a number of automation projects across the estate, improving
efficiency and productivity.
-- New contracts in non e-fulfilment, including Sports Direct and Halfords,
together with organic growth on other contracts, provide significant
earnings momentum into the second half and beyond.
-- Seasonality, rate enhancements reflecting the value-added service
proposition, and the introduction of further shared use activity
within Clicklink provide earnings momentum as we enter the second
half.
-- European e-fulfilment and returns management operations continue
to grow strongly.
-- Delivered record volume over Black Friday-Cyber Monday weekend for
a number of key customers.
-- Introduced new cutting-edge vehicles and innovative trailer designs
to the fleet which will reduce Group carbon emissions significantly,
increase the range between refuelling and increase carrying capacity.
Together, these developments are expected to reduce trunking costs
by 20%.
-- Opened a new facility at Crick, Northamptonshire, to accommodate
the extended Halfords contract, and a new facility in Poznań,
Poland, to accommodate the extended Westwing contract.
Commenting on the results, Steve Parkin, Executive Chairman of Clipper, said:
"The Group continues to be exceptionally well-placed to benefit from the continuing migration to online retailing and the increasing propensity for consumers to choose click-and-collect services when placing orders online.
Our recent contract wins, including Sports Direct and an extended relationship with Halfords, provide significant earnings momentum into the second half of the current financial year and beyond.
We are excited about the future growth of our European operations, as the contracts with s.Oliver, ASOS and Westwing evolve.
Clicklink is now well-positioned to enhance Group earnings, with new clients being introduced to the network, and enhanced rates having been agreed with key customers as the benefits of using the service become evident to retailers.
We have a strong new business pipeline and look forward to continuing to update shareholders as we convert these opportunities."
ENQUIRIES Clipper: +44 (0)113 204 2050 Steve Parkin, Executive Chairman Tony Mannix, Chief Executive Officer David Hodkin, Chief Financial Officer Public Relations Advisers: Buchanan: +44 (0) 20 7466 5000 David Rydell Stephanie Watson
This announcement contains inside information which is disclosed in accordance with the Market Abuse Regulation which came into effect on 3 July 2016.
About Clipper
Clipper Logistics plc (www.clippergroup.co.uk), which is premium listed on the Main Market of the London Stock Exchange, is a retail logistics specialist, which provides value-added, consultancy-led services to its blue chip client base. Clipper is a UK leader in its markets, with a long-standing customer base in:
-- e-fulfilment -- fashion -- high-value logistics
A profitable and cash generative commercial vehicles business complements the Group's logistics activities.
Cautionary statement
Any forward looking statements made in this document represent the Board's best judgment as to what may occur in the future. However, the Group's actual results for the current and future financial periods and corporate developments will depend on a number of economic, competitive and other factors, some of which may be outside the control of the Group. Such factors could cause the Group's actual results in future periods to differ materially from those expressed in any forward looking statements included in this announcement.
PERFORMANCE AT A GLANCE
6 months 6 months 12 months
ended 31 ended 31 ended 30
October 2018 October 2017 April 2018
(unaudited) (unaudited) Change (audited)
GBPm GBPm GBPm
------------------------------------ -------------- -------------- ------- ------------
Revenue 227.9 199.7 +14.1% 400.1
EBIT 10.7 9.2 +16.1% 20.9
Profit before tax and amortisation 9.9 8.4 +17.3% 19.1
Profit before tax 9.3 7.9 +16.9% 18.0
Earnings per share 7.2p 6.3p +14.3% 14.2p
Cash generated from operations 10.1 12.6 -19.8% 24.5
------------------------------------ -------------- -------------- ------- ------------
ALTERNATIVE PERFORMANCE MEASURES
The Group makes use of an Alternative Performance Measure (APM) in the management of its operations and as a key component of its internal and external reporting. In accordance with FRC guidance, this is explained below.
Earnings before interest and tax (EBIT) is defined as the operating profit, including the Group's share of operating profit in equity-accounted investees, before amortisation of intangible assets arising on consolidation. Due to the structure of our contractual relationships, with over 70% of revenue in our UK logistics operations being on open book terms, EBIT is the key metric rather than EBIT margin or revenue. A reconciliation of EBIT by business area to Group operating profit and Group PBT is included in note 4.
Profit before tax and amortisation is defined as the profit before tax, before amortisation of intangible assets arising on consolidation.
GROUP RESULTS
The first half of the year saw revenue and profit growth in line with the Board's expectations.
The Group's strategic positioning in e-fulfilment and returns management services delivered continuing strong organic growth in this business activity.
Compared to H1 FY18, revenues for H1 FY19 benefited from:
- full period contribution from new operations which commenced during
H1 FY18:
o new customer wins including M&S returns, River Island, Edinburgh
Woollen Mill and Crosswater in the United Kingdom and ASOS returns
in Poland; and
o the two new acquisitions, Tesam Distribution Limited and RepairTech
Limited, the former having now been fully integrated into Logistics
and the latter having been amalgamated with Servicecare to form
the Technical Services division within the e-fulfilment and returns
management operating segment;
- full period contribution from new operations which commenced during
the six months ended 30 April 2018 ("H2 FY18"), including the formally-contracted
operations with Halfords;
- partial period contribution from new operations which commenced
during H1 FY19, including Brissi, Ginger Ray, Levi Strauss, Neon
Sheep, Pretty Little Thing, Vestel in RepairTech and a new Servicecare
offering for Amazon in Germany;
- volume growth and extension of services on existing contracts with
ASOS (in both the UK and Poland), Browns, Ireland's largest retailer,
Morrisons, s.Oliver, Wilko and others, in part driven by particularly
strong organic growth in the e-fulfilment market due to the continuing
trend towards online retailing; and
- a significant contribution from property-related advisory services.
This is a revenue stream that we will endeavour to continue and
grow as the Group leverages its growing property portfolio.
These positive developments were partially offset by:
- a decline in Commercial Vehicles. New vehicle sales have fallen,
particularly in large tractor units, as a direct result of the manufacturer
reducing its support to dealerships;
- organic decline in certain customers' trading in the non e-fulfilment
segment as a result of the challenges posed by the migration of
retail to online;
- the relocation of the women's knitwear range from our M&S operation
in Peterborough to another M&S network location; and
- Bench entering administration in H1 FY19. Clipper did not incur
any bad debt on this.
Whilst net revenue growth continues to provide upwards momentum, there have been some cost headwinds during the period:
- some inefficiencies as a result of teething problems with new systems
and processes on certain operations, which have now been resolved;
and
- labour-related cost challenges experienced on certain closed book
contracts, which are being addressed through rate increases with
customers, and productivity improvement initiatives.
The above factors resulted in:
- EBIT from e-fulfilment and returns management activities increasing
by 17.1% to GBP6.2 million (H1 FY18: GBP5.3 million);
- EBIT from non e-fulfilment activities increasing by 16.4% to GBP7.3
million (H1 FY18: GBP6.3 million). Excluding property-related advisory
income of GBP2.8 million (H1 FY18: GBPnil), EBIT from non e-fulfilment
activities reduced by 28.3% to GBP4.5 million (H1 FY18: GBP6.3 million).
- EBIT of the Commercial vehicles division decreasing by 36.9% to
GBP0.9 million (H1 FY18: GBP1.4 million).
To support its continued growth, Clipper has increased its overhead investment in quality people and its back-office systems, offset by reductions in share-based payment accruals. Central logistics costs are in line with prior year at GBP2.5 million (H1 FY18: GBP2.5 million) and head office costs have decreased by GBP0.1 million to GBP1.2 million (H1 FY18: GBP1.3 million), together benefitting from a non-cash share based payment credit of GBP0.7 million, compared to a charge of GBP0.6 million in H1 FY18 - a GBP1.3 million benefit.
In line with Clipper's dividend policy and reflecting the Group's strong cash flow and earnings growth, the Board is pleased to announce an interim dividend of 3.2 pence per share, which will be paid on 7 January 2019 to shareholders on the register at 14 December 2017. This represents an increase of 14.3% (0.4 pence per share) compared to the interim dividend of 2.8 pence paid in January 2018.
STRATEGY
The Group's strategy is built around the same four key principles as in previous years, all of which have seen positive developments over the period under review:
-- To build on Clipper's market leading customer proposition to expand
the customer base;
-- Develop new, complementary products and services;
-- Continue European expansion; and
-- Explore acquisition opportunities.
The Group continues to provide market-leading, value-added logistics solutions to the retail sector in the UK as demonstrated through further new contract wins with blue-chip clients. Examples of these include those with Pretty Little Thing and Sports Direct. The Group is well-positioned in the high-growth e-commerce market and as a result has seen significant volume increases with the majority of its customers.
The Group continues to innovate in order to identify and address the logistical challenges of retailers through the development of new, complementary products and services. By way of example:
- to address one of our customer's need for rapid delivery into central
London we partnered with DeliveryMates, a service provider which
uses mopeds to do last mile deliveries, to ensure same-day drops
into the capital;
- we have collaborated with leading warehouse management systems providers
to implement cutting-edge solutions for several of our customers
in H1 FY19; and
- we have also begun using robot-technology in our Superdry operation,
an autoboxing machine for Wilko and are currently working with another
major client to deliver a significant mechanisation/automation project.
Furthermore, we continue to innovate with organisations such as
Tempus Novo to think out-of-the-box on recruitment, all strategies
to reduce exposure to any labour shortages.
Our European activities continue to progress. A new Servicecare electrical refurbishment operation has been launched in H1 FY19 from one of our existing logistics sites in Germany, replicating a similar operation for the same customer in the UK, and the second Westwing site is ready to go live in Poznań, Poland, as noted in the Outlook section below.
The Group also continues to identify and monitor potential acquisition targets providing complementary activities, whether in existing markets or further afield. We acquired two such businesses in H1 FY18, and we will continue to monitor the market for potential targets and partners which will deliver enhanced earnings and increased shareholder value.
OUTLOOK
Trading continues to perform well in the early part of the second half of the year, underpinned by a strong business development pipeline with varying scales and at various stages of progression, albeit with the majority not scheduled to start until the financial year commencing 1 May 2019.
From early November 2018, Clicklink has secured increased parcel rates driven by its clearly-differentiated service proposition, which will fundamentally change the trading performance of this entity.
We have also secured a new e-fulfilment operation with brewer Adnams which has now gone live.
Operationally we delivered a successful Black Friday to Cyber Monday trading period for our customers. We expect to see the current high activity levels extend through to Christmas and the Boxing Day sales, and further into January with the post-Christmas period being the peak demand period for returns management services.
We continue to experience some localised pressures on the availability of seasonal labour, in part due to continued Brexit uncertainties and in part due to competitive market pressures around labour rates. We have worked with agency labour providers to mitigate these challenges during the peak trading period through certain innovative recruitment and retention strategies, including our Fresh Start programme, and our customers have supported us commercially with such measures.
The commercial vehicles business has seen new vehicle volumes suppressed in the first half of the current financial year. Operating costs have been reduced accordingly, and we expect the second half to return to normal levels of profitability.
In Poland, the fit-out of our second warehouse in Poznań - which includes a large Picktower installation - is now ready to accommodate the enlarged Westwing operation which will go live imminently. In Germany, we are currently relocating existing operations from Kempen to more cost-effective and operationally appropriate locations in Neuss and Nettetal.
BUSINESS REVIEW
Operational review
E-fulfilment and returns management services
E-fulfilment operations include the receipt, warehousing, stock management, picking, packing and despatch of products on behalf of customers to support their online trading activities, as well as a range of ancillary support services. At no time does Clipper take ownership of customers' products.
We continue to manage the return of products on behalf of retailers, particularly those sold online, through our Boomerang brand.
Revenues for e-fulfilment and returns management services have increased 40.7% to GBP107.1 million in H1 FY19 (H1 FY18: GBP76.1 million). EBIT is 17.1% ahead of the equivalent period in the prior year at GBP6.2 million (H1 FY18: GBP5.3 million).
The growth has been driven through:
- new customer wins from the prior year generating a full six months
of contribution in H1 FY19 including M&S returns, River Island,
ASOS returns in Poland, with Clicklink benefiting from Urban Outfitters
and Supergroup joining the network;
- those operations new to H1 FY19, including Brissi, Ginger Ray, Pretty
Little Thing and the new Servicecare offering for Amazon in Germany;
- growth with existing customers including ASOS (in both the UK and
Poland), Ireland's largest retailer, s.Oliver and Wilko; and
- the earnings-enhancing impact of RepairTech Limited, acquired in
June 2017. Repairtech has secured a number of new customers post-acquisition
including Vestel and Hisense.
Due to the structure of our contractual relationships, with over 70% of revenue in our UK logistics operations being on open book terms, EBIT is the key metric rather than EBIT margin. The seasonality of our Click and Collect operations distort reported margin percentages between the first six months of the financial year and the second six months.
Non e-fulfilment logistics
Non e-fulfilment operations include receipt, warehousing, stock management, picking and distribution of products on behalf of customers. Clipper does not take ownership of customers' products at any time.
Within this sector, Clipper handles high value products, including tobacco, electrical products and high value clothing, whilst also undertaking traditional retail support services including processing, storage and distribution of products, particularly fashion, to high street retailers.
Revenues were 15.8% ahead of the same period of the prior year at GBP76.1 million (H1 FY18: GBP65.7 million), and EBIT was 16.4% higher at GBP7.3 million (H1 FY18: GBP6.3 million), including GBP2.8 million from property-related advisory services (H1 FY18: GBPnil). Excluding this new income stream, EBIT was down in the period, due in particular to volume reductions on a closed book contract with a key customer which is restructuring its business, together with reduced levels of tobacco activity. However, new contract wins, together with improving levels of tobacco activity, provide positive earnings momentum as we enter the second half of the financial year.
The growth in revenues is attributable to:
- those new contracts which commenced in FY18 so which contribute
to the full H1 FY19 period, including Crosswater, Edinburgh Woollen
Mill and Halfords, and the effect of the acquisition of Tesam Distribution
Limited, albeit noting that M&S women's knitwear has subsequently
been withdrawn from our operation;
- those recently commenced operations, including Brissi, Ginger Ray,
Levi Strauss, and Neon Sheep;
- organic growth with Browns, C&A, and Morrisons; and
- contributions from property-related advisory services.
Central logistics overheads
Central logistics overheads represent the costs of support services specific to the logistics operations, but which cannot be allocated in a meaningful way to the sub-segment activities.
Such costs include directorate, advertising and promotion, accounting and IT, and the costs of the solutions development team.
Central logistics overheads of GBP2.5 million are in line with the prior year (H1 FY18: GBP2.5 million), as noted above.
Commercial vehicles
The commercial vehicles business, Northern Commercials, operates Iveco and Fiat commercial vehicle dealerships from six locations, together with three sub-dealerships. The business sells new and used vehicles, provides servicing and repair facilities, and sells parts. Vehicles sold and serviced range from small light commercial vans, through to articulated tractor units.
We generated revenue of GBP45.4 million for H1 FY19, 22.8% down on the same period of last year (H1 FY18: GBP58.8 million). EBIT fell by 36.9% to GBP0.9 million in the same period (H1 FY18: GBP1.4 million). There has been a reluctance by the manufacturer to provide dealer support this year, and whilst there has been some relaxing of this in relation to vans, there is very little manufacturer support for heavy truck sales. This is having a significant impact upon all dealers in the network, and the management team in Northern Commercials have been focusing on cost reduction to offset as much of the impact as possible. We expect the second half of the current financial year to show improved performance.
Financial Review
Revenue
Group revenue increased by 14.1% to GBP227.9 million (H1 FY18: GBP199.7 million).
Revenue (unaudited) Six months to
31 October
2018 2017 Change
----------------------------------- ----------- ----------- -------
E-fulfilment & returns management GBP107.1 GBP76.1
services m m +40.7%
GBP76.1 GBP65.7
Non e-fulfilment logistics m m +15.8%
----------------------------------- ----------- ----------- -------
GBP183.2 GBP141.8
Total value-added logistics m m +29.2%
GBP45.4 GBP58.8
Commercial vehicles m m -22.8%
Intra-Group GBP(0.7)m GBP(0.9)m
----------------------------------- ----------- ----------- -------
GBP227.9 GBP199.7
Consolidated total m m +14.1%
----------------------------------- ----------- ----------- -------
EBIT
Group EBIT increased by 16.1% to GBP10.7 million (H1 FY18: GBP9.2 million).
Group EBIT (unaudited) Six months to
31 October
2018 2017 Change
----------------------------------- ----------- ----------- -------
E-fulfilment & returns management GBP6.2 GBP5.3
services m m +17.1%
GBP7.3 GBP6.3
Non e-fulfilment logistics m m +16.4%
Central logistics costs GBP(2.5)m GBP(2.5)m
----------------------------------- ----------- ----------- -------
GBP11.0 GBP9.1
Total value-added logistics m m +21.2%
GBP0.9 GBP1.4
Commercial vehicles m m -36.9%
Head office costs GBP(1.2)m GBP(1.3)m
----------------------------------- ----------- ----------- -------
GBP9.2
Consolidated total GBP10.7m m +16.1%
----------------------------------- ----------- ----------- -------
Net finance costs
Net finance costs were GBP1.0 million (H1 FY18: GBP0.9 million). These costs have increased by 7.1% due to the full year impact of the two strategic acquisitions in the prior year, together with significant capital expenditure throughout the year ending 30 April 2018 and in H1 FY19, much of which will be recovered from open book customers through depreciation charges in future periods.
Taxation
The tax charge on profit before tax was GBP1.9 million (H1 FY18: GBP1.7 million). The effective tax rate in the period is 21.0%, the same as in H1 FY18. The headline rate of corporation tax in the UK is 19%, unchanged from the prior year.
Earnings Per Share (EPS)
EPS was 7.2p in the period, 14.3% up on the prior period (H1 FY18: 6.3p), slightly lower than the EBIT growth of 16.1%. The EBIT growth does not translate fully to EPS growth, in part because of the full six months' effect of amortisation charges relating to the two subsidiaries acquired throughout the course of H1 FY18 and in part because of increased dilution following the issue of 1.25 million additional shares.
Dividend
An interim dividend for the current year of 3.2 pence per share was approved by the Board on 3 December 2018. The dividend will be payable on 7 January 2019 to shareholders on the register at the close of business on 14 December 2018.
Cashflow
Cash generated from operations in the period was GBP10.1 million (H1 FY18: GBP12.6 million).
Whilst the profit before tax from operating activities increased GBP1.3 million in H1 FY19 compared with H1 FY18, H1 FY19 included the benefit of a non-cash share based payment credit of GBP0.7 million, compared to a charge of GBP0.6 million in H1 FY18 - a GBP1.3 million benefit year on year. Net cash used in working capital during the period was GBP4.4 million (H1 FY18: GBP1.2 million), as we had a higher than normal level of accrued revenue at the half-year. (We define net cash used in / generated from working capital as the cash flows generated from changes in: trade and other receivables of GBP(21.2) million (H1 FY18: GBP(21.2) million), inventories of GBP(2.1) million (H1 FY18: GBP(0.1) million) and trade and other payables of GBP18.9 million (H1 FY18: GBP20.1 million), per the cash flow statement.)
Tax cash outflows were largely in line for H1 FY19 compared to H1 FY18 being GBP1.9 million (H1 FY18: GBP2.0 million). There have been no fundamental changes to tax rates year-on-year.
Capital expenditure in the period on non-current assets was GBP11.1 million (H1 FY18: GBP6.3 million), compared to a depreciation and impairment charge of GBP3.5 million (H1 FY18: GBP3.3 million). This increase in capital expenditure is predominantly due to GBP3.9 million of spend on one customer project, GBP2.2 million on a new mezzanine installation for another, GBP1.7 million in Poland on the new Poznań facility and GBP2.1 million on the fit-out of our new Crick facility (each of which will be fully recovered from the relevant customers through open book contract mechanisms, together with a finance fee). GBP3.2 million (H1 FY18: GBP2.6 million) of the capital expenditure was financed on hire purchase or finance lease agreements and GBP0.3 million (H1 FY18: GBPnil) was financed by specific bank debt.
Deferred consideration of GBP0.5 million was paid in H1 FY19 in respect of one of the prior year acquisitions. Cash outflows of GBP11.8 million were incurred in H1 FY18 as a result of the two acquisitions.
Net debt at 31 October 2018 was GBP42.1 million (2017: GBP38.8 million). The increase in net debt compared to the prior year is primarily due to the capital expenditure noted above. At 31 October 2018, there are undrawn bank facilities of GBP17.9 million (2017: GBP23.5 million) committed and available. See note 13 for further details.
RISK MANAGEMENT
There are a number of risks and uncertainties facing the business in the second half of the financial year. A risk management process is used by the Group to identify, monitor and manage such risks. The principal risks and uncertainties facing the business are unchanged from those identified in the 2018 Annual Report. The key such risks are outlined below:
-- Reputational impact of any failed project implementations;
-- Failure to develop and retain key people;
-- A loss of focus on operational delivery;
-- A failure to manage health and safety risks;
-- Availability of agency labour;
-- A worsening of a customer relationship may lead to non-renewal of
contracts;
-- A natural or other disaster on any major site;
-- Failure of IT systems or infrastructure;
-- Legal and regulatory risks, such as those introduced by the National
Living Wage and GDPR;
-- Financial resilience of customers;
-- Downturn in the UK commercial property market;
-- Liquidity risk;
-- Credit risk; and
-- Fraud risk.
The Group has in place mitigation strategies to deal with all of these risks. Further details can be found on pages 20 to 23 in the 2018 Annual Report.
CONDENSED FINANCIAL STATEMENTS FOR THE 6 MONTHS TO 31 OCTOBER 2018
Interim Group Income Statement (unaudited)
Year Note 6 months 6 months
ended ended ended
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- ------------------------------------------------------------ ----- ------------ ------------
400,115 Revenue 3 227,927 199,685
(283,324) Cost of Sales (164,901) (142,027)
---------- ------------------------------------------------------------ ----- ------------ ------------
116,791 Gross profit 63,026 57,658
2,398 Other net gains 119 78
(98,358) Administration and other expenses (52,308) (48,280)
---------- ------------------------------------------------------------ ----- ------------ ------------
Operating profit before share of equity-accounted
20,831 investees, net of tax 10,837 9,456
Share of equity-accounted investees,
(889) net of tax (572) (598)
---------- ------------------------------------------------------------ ----- ------------ ------------
19,942 Operating profit 10,265 8,858
---------- ------------------------------------------------------------ ----- ------------ ------------
20,854 EBIT 10,695 9,210
Less: amortisation of other intangible
(1,094) assets (593) (478)
share of tax and finance costs of equity-accounted
182 investees 163 126
19,942 Operating profit 10,265 8,858
---------- ------------------------------------------------------------ ----- ------------ ------------
(2,014) Finance costs 6 (1,023) (951)
38 Finance income 7 26 20
---------- ------------------------------------------------------------ ----- ------------ ------------
17,966 Profit before income tax 9,268 7,927
(3,685) Income tax expense 8 (1,947) (1,663)
14,281 Profit for the financial period 7,321 6,264
---------- ------------------------------------------------------------ ----- ------------ ------------
14.2p Basic earnings per share 9 7.2p 6.3p
14.1p Diluted earnings per share 9 7.2p 6.1p
---------- ------------------------------------------------------------ ----- ------------ ------------
Interim Group Statement of Comprehensive Income (unaudited)
Year Note 6 months 6 months
ended ended ended
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- ------------------------------------------ ----- ------------ ------------
14,281 Profit for the financial period 7,321 6,264
Other comprehensive income (expense)
for the period, net of tax:
To be classified to the income statement
in subsequent periods:
Exchange differences on retranslation
(106) of foreign operations 10 (100)
---------- ------------------------------------------ ----- ------------ ------------
Total comprehensive income for the period
attributable to equity holders of the
14,175 parent company 7,331 6,164
---------- ------------------------------------------ ----- ------------ ------------
Interim Group Statement of Financial Position (unaudited)
30 April Note 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- ---------------------------------- ----- ----------- -----------
ASSETS
Non-current assets
---------- ---------------------------------- ----- ----------- -----------
25,951 Goodwill 25,951 26,958
11,267 Other intangible assets 11,698 9,833
---------- ---------------------------------- ----- ----------- -----------
37,218 Intangible assets 37,649 36,791
44,998 Property, plant and equipment 11 51,205 46,703
1,278 Investments 706 1,569
1,950 Non-current financial assets 1,950 1,450
- Deferred tax assets - -
---------- ---------------------------------- ----- ----------- -----------
85,444 Total non-current assets 91,510 86,513
---------- ---------------------------------- ----- ----------- -----------
Current assets
22,099 Inventories 24,725 30,858
73,430 Trade and other receivables 94,630 70,837
2,275 Cash and cash equivalents 12 2,119 926
---------- ---------------------------------- ----- ----------- -----------
97,804 Total current assets 121,474 102,621
---------- ---------------------------------- ----- ----------- -----------
183,248 TOTAL ASSETS 212,984 189,134
---------- ---------------------------------- ----- ----------- -----------
EQUITY AND LIABILITIES
Current Liabilities
102,402 Trade and other payables 120,693 110,612
9,219 Financial liabilities: Borrowings 13 10,609 7,813
78 Short term provisions 76 281
2,540 Current income tax liabilities 2,873 1,913
---------- ---------------------------------- ----- ----------- -----------
114,239 Total current liabilities 134,251 120,619
---------- ---------------------------------- ----- ----------- -----------
Non-current liabilities
26,664 Borrowings 13 35,536 33,319
1,486 Long term provisions 1,592 1,417
1,541 Deferred tax liabilities 869 1,244
---------- ---------------------------------- ----- ----------- -----------
29,691 Total non-current liabilities 37,997 35,980
---------- ---------------------------------- ----- ----------- -----------
143,930 TOTAL LIABILITIES 172,248 156,599
---------- ---------------------------------- ----- ----------- -----------
Equity shareholders' funds
51 Share capital 51 50
1,710 Share premium 1,859 348
(139) Currency translation reserve (129) (133)
84 Other reserve 84 84
6,006 Merger reserve 6,006 6,006
2,745 Share based payment reserve 2,272 2,882
28,861 Retained earnings 30,593 23,298
---------- ---------------------------------- ----- ----------- -----------
39,318 TOTAL EQUITY 40,736 32,535
---------- ---------------------------------- ----- ----------- -----------
183,248 TOTAL EQUITY AND LIABILITIES 212,984 189,134
---------- ---------------------------------- ----- ----------- -----------
Interim Group Statement of Changes in Equity (unaudited)
Share
Currency based
Share Share Other translation Merger payment Retained Total
capital premium reserve reserve reserve reserve earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------- --------- --------- --------- ------------- --------- --------- ---------- --------
Balance at 1 May
2017 50 80 84 (33) 6,006 2,038 21,845 30,070
Profit for the
period - - - - - - 6,264 6,264
Other comprehensive
income / (expense) - - - (100) - - - (100)
Equity settled
transactions - - - - - 844 2 846
Share issue - 268 - - - - - 268
Dividends - - - - - - (4,813) (4,813)
----------------------- --------- --------- --------- ------------- --------- --------- ---------- --------
Balance at 31 October
2017 50 348 84 (133) 6,006 2,882 23,298 32,535
----------------------- --------- --------- --------- ------------- --------- --------- ---------- --------
Profit for the
period - - - - - - 8,017 8,017
Other comprehensive
income / (expense) - - - (6) - - - (6)
Equity settled
transactions - - - - - (137) 355 218
Share issue 1 1,362 - - - - - 1,363
Dividends - - - - - - (2,809) (2,809)
----------------------- --------- --------- --------- ------------- --------- --------- ---------- --------
Balance at 30 April
2018 51 1,710 84 (139) 6,006 2,745 28,861 39,318
----------------------- --------- --------- --------- ------------- --------- --------- ---------- --------
Profit for the
period - - - - - - 7,321 7,321
Other comprehensive
income / (expense) - - - 10 - - - 10
Equity settled
transactions - - - - - (473) 96 (377)
Share issue - 149 - - - - - 149
Dividends - - - - - - (5,685) (5,685)
----------------------- --------- --------- --------- ------------- --------- --------- ---------- --------
Balance at 31 October
2018 51 1,859 84 (129) 6,006 2,272 30,593 40,736
----------------------- --------- --------- --------- ------------- --------- --------- ---------- --------
Interim Group Statement of Cash Flows (unaudited)
Year Note 6 months 6 months
ended ended ended
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- -------------------------------------------- ----- ------------ ------------
17,966 Profit before tax from operating activities 9,268 7,927
Adjustments to reconcile profit before
tax to net cash flows:
Depreciation and impairment of property,
6,394 plant and equipment 3,482 3,264
Amortisation and impairment of intangible
1,621 assets 902 655
Gain on disposal of property, plant
(2,203) and equipment (52) (38)
Share of equity-accounted investees,
889 net of tax 572 598
(198) Exchange differences (7) (190)
6,
1,976 Net finance costs 7 997 931
1,219 Share based payments charge / (credit) 15 (721) 596
Working capital adjustments
(Increase) / decrease in trade and other
(23,785) receivables (21,175) (21,174)
8,816 (Increase) / decrease in inventories (2,111) (88)
Increase / (decrease) in trade and other
11,801 payables 18,913 20,079
---------- -------------------------------------------- ----- ------------ ------------
24,496 Cash generated from operations 10,068 12,560
38 Interest received 1 2
(1,932) Interest paid (976) (856)
(3,968) Income tax paid (1,938) (2,005)
---------- -------------------------------------------- ----- ------------ ------------
18,634 Net cash flows from operating activities 7,155 9,701
---------- -------------------------------------------- ----- ------------ ------------
Investing activities
(6,849) Purchase of property, plant and equipment 11 (6,253) (3,575)
Proceeds from sale of property, plant
6,658 and equipment 144 86
(844) Purchase of intangible assets (1,332) (134)
3 Proceeds from sale of intangible assets - -
Acquisition of subsidiary undertakings
(11,773) net of cash acquired 16 (500) (11,773)
---------- -------------------------------------------- ----- ------------ ------------
(12,805) Net cash flows from investing activities (7,941) (15,396)
---------- -------------------------------------------- ----- ------------ ------------
Financing activities
17 New bank loans - 17
(101) Debt issue costs paid - (90)
9,000 Net drawdown of revolving credit facility 9,000 14,500
Finance leases advanced in respect of
prior year purchases of property, plant
- and equipment 298 -
1,631 Shares issued 149 268
(7,622) Dividends paid 10 (5,685) (4,813)
(500) Non-current financial assets advanced - -
(812) Repayment of bank loans (510) (398)
(7,366) Repayment of capital on finance leases (3,392) (3,725)
---------- -------------------------------------------- ----- ------------ ------------
(5,753) Net cash flows from financing activities (140) 5,759
---------- -------------------------------------------- ----- ------------ ------------
Net increase / (decrease) in cash and
76 cash equivalents (926) 64
---------- -------------------------------------------- ----- ------------ ------------
Cash and cash equivalents at start of
862 period 938 862
---------- -------------------------------------------- ----- ------------ ------------
Cash and cash equivalents at end of
938 period 12 926
---------- -------------------------------------------- ----- ------------ ------------
Notes to the Interim Financial Statements
1. Accounting policies
Basis of preparation
Clipper Logistics plc ("the Company") is a public limited company incorporated and domiciled in the United Kingdom. The condensed interim financial statements have been prepared in accordance with the Disclosure and Transparency rules of the Financial Conduct Authority ("FCA") and where applicable IAS 34 "Interim Financial Reporting (as adopted by the EU)".
As required by the Disclosure and Transparency rules of the FCA, the condensed interim financial statements have been prepared applying the accounting policies and presentation that were applied in the preparation of the Company's published consolidated financial statements for the year ended 30 April 2018. These statements do not include all the information required for full annual financial statements and should be read in conjunction with the full annual report for the year ended 30 April 2018. The financial information for the half year ended 31 October 2018 and for the equivalent period in 2017 has not been audited or reviewed.
The information for the year ended 30 April 2018 does not constitute statutory accounts as defined in section 435 of the Companies Act 2006. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The auditors reported on those accounts: their report was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. The financial statements are prepared on the going concern basis.
Going concern
The Group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Business Review. The financial position of the Group, its cash flows, liquidity position and borrowing facilities are described above. The Group has considerable financial resources together with strong trading relationships with its key customers and suppliers. As a consequence, the Directors believe that the Group is well placed to manage its business risk successfully.
After making enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the condensed consolidated interim financial statements.
New standards and interpretations
The following accounting standards and interpretations became effective, and were adopted by the Group, for the current reporting period:
International Accounting Standards (IAS / IFRSs) Effective Date IFRS 15 "Revenue from contracts with customers" 1 January 2018 IFRS 9 "Financial instruments" (issued in 2014) 1 January 2018
The application of these standards has not had a material effect on the net assets, results and disclosures of the Group.
As reported within the 2018 Annual Report and Accounts, IFRS 9 Financial Instruments was issued by the IASB in July 2014, and became effective for the Group from 1 May 2018. Applying IFRS 9 has resulted in changes to the measurement and disclosure of financial instruments and introduced a new expected loss impairment model. The Group has adopted the simplified approach to recognise lifetime credit losses for trade receivables and contract assets. The adoption of the standard has not had a significant impact on the Group's consolidated results or financial position.
IFRS 15 Revenue from Contracts with Customers was issued by the IASB in May 2014 and became effective for the Group from 1 May 2018. The Group has applied the cumulative catch-up approach, therefore comparative periods have not been restated, and are presented as previously reported, under IAS 18. Under IFRS 15, revenue is recognised when the customer obtains control of the goods and services transferred by the Group and the related performance obligations have been satisfied. The amount recognised reflects the amount of consideration that the Group expects to be entitled to in exchange for those goods and services. The implementation of the standard did not have a material effect on the Group's financial statements as at 1 May 2018, therefore no transition adjustment was made. There was no material effect on the Group's results in the six-month period to 31 October 2018 compared to those that would have been reported under IAS 18.
The Group has not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective.
2. Financial risks, estimates, assumptions and judgements
The preparation of the condensed interim financial information requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
In preparing these condensed interim financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements for the year ended 30 April 2018.
3. Revenue
The Group has applied IFRS 15 from 1 May 2018, using the cumulative effect method and therefore comparative information has not been restated and continues to be reported under IAS 18. The implementation of the standard did not have a material effect on the Group's financial statements as at 1 May 2018, therefore no transition adjustment was made.
There was no material effect on the Group's results in the six-month period to 31 October 2018 compared to those that would have been reported under IAS 18.
Nature, timing and satisfaction of performance obligations
Revenue Stream Impact of IFRS 15
Open book revenue Revenue relating to costs to serve the customer are
invoiced in line with the customer receiving and consuming
benefits under the contract via the "Open book" charging
mechanism with either a fixed or variable management
fee, and is recognised in the period in which it is
earned. Performance obligations are satisfied over
time and measured against minimum service level agreements.
There has been no change in the timing of revenue
recognition on application of IFRS 15.
---------------------------------------------------------------
Closed book revenue In closed book contracts, revenue is typically recognised
based on a pre-agreed price and is typically per unit/parcel/
delivery or pallet etc. Revenue based on a pre-agreed
rate-card is recognised as services are provided,
in line with the customer receiving and consuming
benefits under the contract. There has been no change
in the timing of revenue recognition on application
of IFRS 15.
---------------------------------------------------------------
Management fees Fixed management fees are recognised over the contract
term. Performance obligations are satisfied over time.
There has been no change in the timing of revenue
recognition on application of IFRS 15. Variable management
fees (a fixed percentage of costs) are recognised
as the corresponding costs are incurred i.e. where
we have the right to invoice the customer at an amount
that corresponds directly with performance to date,
we apply the practical expedient to recognise revenue
at that amount.
---------------------------------------------------------------
Property-related Property-related advisory fees are recognised as services
advisory services are provided. There has been no change in the timing
of revenue recognition on the application of IFRS
15.
---------------------------------------------------------------
Key performance Variable revenue is recognised to the extent it is
indicators/ gain-shares/ highly probable a significant revenue reversal will
penalties not occur. There has been no change in the timing
of revenue recognition on application of IFRS 15.
---------------------------------------------------------------
Sale of motor vehicles, Sales of vehicles and parts are recognised when the
parts and aftersales goods have been supplied. Aftersales services are
services recognised when the service has been completed in
line with stage of completion of the transaction at
the reporting date, assessed by the time expended
on services that are charged on a labour rate basis.
Under IFRS 15, revenue is recognised when the customer
has control of the goods. This has had no impact on
the current revenue recognition policies.
---------------------------------------------------------------
Repairs and maintenance There is no change to the recognition of revenue from
contracts the sale of warranty products as a result of transition
to IFRS 15. Under the new accounting standard, revenue
is recognised in line with the performance obligation,
i.e. the period in which the customer can exercise
their rights under the warranty, and therefore recognised
over the life of the warranty, as was the case under
IAS 18.
---------------------------------------------------------------
Disaggregation of revenue
Revenue has been disaggregated in the table below in line with how management reviews the performance of the Group.
Revenue recognised in the income statement is analysed as follows:
Year 6 months 6 months
ended ended ended
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- ------------------------------------------- ------------ ------------
159,350 E-fulfilment & returns management services 107,107 76,146
139,144 Non e-fulfilment logistics 76,083 65,691
---------- ------------------------------------------- ------------ ------------
298,494 Value-added logistics services 183,190 141,837
103,598 Commercial vehicles 45,389 58,795
(1,977) Inter-segment sales (652) (947)
---------- ------------------------------------------- ------------ ------------
400,115 Revenue from external customers 227,927 199,685
---------- ------------------------------------------- ------------ ------------
Non e-fulfilment logistics revenue includes GBP2,800,000 (year ended 30 April 2018: GBP4,200,000; 6 months ended 31 October 2017: GBPnil) in respect of property-related advisory services.
4. Segment information
For management purposes, the Group is organised into two main reportable segments:
-- Value-added logistics services -- Commercial vehicles, including sales, servicing and repairs
Within the value-added logistics services segment, the Chief Operating Decision Maker also reviews performance of three separate business activities:
-- E-fulfilment & returns management services
-- Non e-fulfilment logistics
-- Central logistics overheads, being the costs of support services
specific to the Value-added logistics segment, but which are impractical
to allocate between the sub-segment activities
Inter-segment transactions are entered into under normal commercial terms and conditions and on an arm's length basis that would also be available to unrelated third parties.
The following table presents profit information for continuing operations regarding the Group's business segments:
Year 6 months 6 months
ended ended ended
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- --------------------------------------------------- ------------ ------------
Operating profit
11,874 E-fulfilment & returns management services 6,241 5,328
14,786 Non e-fulfilment logistics 7,289 6,263
(5,688) Central logistics (2,544) (2,526)
---------- --------------------------------------------------- ------------ ------------
20,972 Value-added logistics services 10,986 9,065
2,450 Commercial vehicles 909 1,441
(2,568) Head office costs (1,200) (1,296)
---------- --------------------------------------------------- ------------ ------------
20,854 Group EBIT 10,695 9,210
(1,094) Amortisation of other intangible assets (593) (478)
Share of tax and finance costs of equity-accounted
182 investees 163 126
---------- --------------------------------------------------- ------------ ------------
19,942 Operating profit 10,265 8,858
(2,014) Finance costs (1,023) (951)
38 Finance income 26 20
---------- --------------------------------------------------- ------------ ------------
17,966 Profit before income tax 9,268 7,927
---------- --------------------------------------------------- ------------ ------------
5. Staff costs
The Remuneration Committee have concluded that, having considered the trading performance excluding property-related advisory services which were not contemplated at the time the EPS targets were set, none of the long-term incentives due to vest on 14 January 2019 should now vest. Other than this change, Directors' remuneration is in line with the disclosures set out in the 2018 Annual Report.
6. Finance costs
Year 6 months 6 months
ended ended ended
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- ------------------------------------------------- ------------ ------------
547 On bank loans and overdrafts 291 215
926 On hire purchase agreements 456 471
114 Amortisation of debt issue costs 64 50
339 Commercial vehicle stocking interest 148 180
62 Invoice discounting 47 23
26 Other interest payable 17 12
Total interest expense for financial liabilities
2,014 measured at amortised cost 1,023 951
---------- ------------------------------------------------- ------------ ------------
7. Finance income
Year 6 months 6 months
ended ended ended
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- ------------------------------------------- ------------ ------------
2 Bank interest - 2
1 Other interest 1 -
35 Amounts receivable from related parties 25 18
---------- ------------------------------------------- ------------ ------------
Total interest income for financial assets
38 measured at amortised cost 26 20
---------- ------------------------------------------- ------------ ------------
8. Taxation
Tax has been provided on the profit before taxation, at the estimated effective rate for the full year of 21.0% (Year ended 30 April 2018: 20.5%).
9. Earnings per share
Basic earnings per share amounts are calculated by dividing profit for the year attributable to ordinary equity holders of the Company by the weighted average number of ordinary shares outstanding during the year. Diluted earnings per share amounts are calculated by dividing the profit attributable to ordinary equity holders of the Company by the weighted average number of shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on conversion of all the potentially dilutive instruments into ordinary shares.
The following reflects the income and share data used in the basic earnings per share computation:
Year 6 months 6 months
ended ended ended
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- ----------------------------------------------- ------------ ------------
Profit attributable to ordinary equity holders
14,281 of the parent company 7,321 6,264
Thousands Thousands Thousands
100,338 Basic weighted average number of shares 101,482 100,216
---------- ----------------------------------------------- ------------ ------------
14.2p Basic earnings per share 7.2p 6.3p
---------- ----------------------------------------------- ------------ ------------
101,358 Diluted weighted average number of shares 101,885 102,072
---------- ----------------------------------------------- ------------ ------------
14.1p Diluted earnings per share 7.2p 6.1p
---------- ----------------------------------------------- ------------ ------------
10. Dividends
Year 6 months 6 months
ended ended ended
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- --------------------------------------------- ------------ ------------
Final dividend for the year ended 30 April
4,814 2017 of 4.8p per share - 4,813
Interim dividend for the year ended 30 April
2,808 2018 of 2.8p per share - -
Final dividend for the year ended 30 April
- 2018 of 5.6p per share 5,685 -
7,622 Total dividends paid 5,685 4,813
---------- --------------------------------------------- ------------ ------------
An interim dividend for the current year of GBP3,249,000 at 3.2p per share was approved by the board on 3 December 2018. The dividend will be payable on 7 January 2019 to shareholders on the register at the close of business on 14 December 2018.
11. Property, plant and equipment
During the six months ended 31 October 2018, the Group acquired assets with a cost of GBP9,759,000 (six months ended 31 October 2017: GBP6,150,000). Of the assets acquired, GBP3,225,000 (2017: GBP2,575,000) was funded by hire purchase or finance lease arrangements in the period and GBP281,000 (2017: GBPnil) was funded by bank loans secured on the specific assets. Included in the additions during the period are assets in the course of construction amounting to GBP4,848,000 (2017: GBP1,833,000), the majority of which will be funded by finance lease arrangements when complete.
12. Cash and cash equivalents
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- -------------------------------- ----------- -----------
2,275 Cash and cash equivalents 2,119 926
(1,337) Bank overdraft (2,107) -
---------- -------------------------------- ----------- -----------
938 Total cash and cash equivalents 12 926
---------- -------------------------------- ----------- -----------
13. Financial liabilities - Borrowings
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- ----------------------------------------- ----------- -----------
Non current:
1,192 Bank loans 826 1,304
9,000 Revolving credit advances 18,000 14,500
Obligations under finance leases or hire
16,823 purchase agreements 16,997 17,919
(351) Unamortised debt issue costs (287) (404)
---------- ----------------------------------------- ----------- -----------
26,664 35,536 33,319
---------- ----------------------------------------- ----------- -----------
Current:
1,337 Bank overdrafts 2,107 -
887 Bank loans 1,025 809
Obligations under finance leases or hire
6,995 purchase agreements 7,477 7,004
---------- ----------------------------------------- ----------- -----------
9,219 10,609 7,813
---------- ----------------------------------------- ----------- -----------
35,883 Total borrowings 46,145 41,132
2,275 Less: cash and cash equivalents 2,119 926
1,950 loans to related party 1,950 1,450
---------- ----------------------------------------- ----------- -----------
31,658 Net debt 42,076 38,756
---------- ----------------------------------------- ----------- -----------
The principal lender has security over all assets of the Group's UK operations.
The Group's obligations under finance leases or hire purchase agreements are secured by the lender's charge over the relevant assets.
The maturity analysis of the bank loans and revolving credit advances is as follows:
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- ----------------------------- ----------- -----------
887 In one year or less 1,025 809
10,192 Between one and five years 18,826 15,804
- After five years - -
(351) Unamortised debt issue costs (287) (404)
---------- ----------------------------- ----------- -----------
10,728 19,564 16,209
---------- ----------------------------- ----------- -----------
The Group has access to a committed overdraft of GBP8,000,000 and a non-amortising revolving credit facility of GBP30,000,000 repayable in January 2021. At 31 October 2018 GBP18,000,000 (2017: GBP14,500,000) of the revolving credit facility was drawn.
14. Financial instruments
Fair value of financial instruments
The book value of trade and other receivables, trade and other payables, cash and cash equivalents & current borrowings equates to fair value.
The table below sets out the book value and fair value of the Group's other financial assets and liabilities:
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- ------------------------------ ----------- -----------
Non-current financial assets:
1,950 Book value 1,950 1,450
1,907 Fair value 1,902 1,387
Non-current borrowings:
26,664 Book value 35,536 33,319
25,919 Fair value 34,752 32,485
---------- ------------------------------ ----------- -----------
The main methods and assumptions used in estimating the fair values of financial instruments are as follows:
- Interest-bearing loans and borrowings: fair value is calculated
based on discounted expected future principal and interest flows;
and
- Trade and other receivables / payables: the notional amount for
trade receivables / payables with a remaining life of less than
one year is deemed to reflect their fair value.
Long term borrowings are classified as Level 2 (items with significant observable inputs) financial liabilities under IFRS 13. There have been no transfers between Level 1 and Level 2 financial instruments during the period.
15. Share based payments
There have been no options granted in the six months ended 31 October 2018. Details of grants in prior periods are set out in the 2018 Annual Report. During the six months ended 31 October 2018 the Company issued 170,247 ordinary shares for aggregate consideration of GBP149,000 to satisfy share options. At 31 October 2018 options over 507,824 ordinary shares (2017: 28,349) were exercisable.
The credit for share based payments in the six months ended 31 October 2018 is GBP721,000 (2017: charge of GBP596,000).
The increase in deferred tax asset during the period in relation to share based payments amounted to GBP349,000, which has been recognised in the share based payment reserve.
16. Business combinations
In June 2018, the Company paid deferred consideration of GBP500,000 in relation to the acquisition of RepairTech Limited which was completed in the prior year.
None of the provisional fair values reported in the 2018 Annual Report in respect of acquisitions have required any adjustment.
17. Related party disclosures
The company owns 50% of the issued capital and voting rights of Clicklink Logistics Limited ("Clicklink"), a customer of the Group and a provider of services to the Group.
The condensed financial statements include the following in respect of Clicklink:
Year 6 months 6 months
ended ended ended
30 April 31 October 31 October
2018 2018 2017
GBP'000 GBP'000 GBP'000
---------- --------------------------------- ------------ ------------
Income statement:
15,738 Revenue credited 8,609 7,579
1,682 Costs charged 969 646
35 Finance income credited 25 18
Statement of financial position:
1,950 Non-current financial assets 1,950 1,450
1,491 Trade and other receivables 2,406 1,527
168 Trade and other payables 279 182
---------- --------------------------------- ------------ ------------
Property-related advisory service fees of GBP2,800,000 receivable from Hamsard 3476 Limited have been credited to the income statement in the period. The statement of financial position at 31 October 2018 includes GBP2,800,000 in trade and other receivables. Other related party transactions are in line with the disclosures set out in the 2018 Annual Report.
DIRECTORS' RESPONSIBILITY STATEMENT IN RESPECT OF THE CONDENSED INTERIM FINANCIAL STATEMENTS
The Directors confirm that to the best of our knowledge:
-- This condensed set of financial statements for the six months ended
31 October 2018 and for the equivalent period in 2017 has been prepared
on the basis of the accounting policies set out in the 2018 Annual
Report and in accordance with IAS 34 Interim Financial Reporting
as adopted by the European Union.
-- the interim management report includes a fair review of the information
required by:
o paragraph DTR 4.2.7R of the Disclosure Guidance and Transparency
Rules of the Financial Conduct Authority, being an indication
of important events that have occurred during the first six months
of the current financial year and their impact on the condensed
set of financial statements; and a description of the principal
risks and uncertainties for the remaining six months of the financial
year; and
o paragraph DTR 4.2.8R of the Disclosure Guidance and Transparency
Rules, being related party transactions that have taken place
in the first six months of the financial year and that have materially
affected the financial position or performance of the Group during
that period, or any changes in the related party transactions
described in the last annual report that could do so.
The Directors of Clipper Logistics plc as at 31 October 2018 are listed in the 2018 Annual Report.
This report was approved by the Board for release on 5 December 2018 and is available on the Company's website www.clippergroup.co.uk under "Investor News" then "Results and Presentations".
By order of the Board
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 LLFFTFALEIIT
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