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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Creightons Plc | LSE:CRL | London | Ordinary Share | GB0002341666 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 27.50 | 27.00 | 28.00 | 27.50 | 27.50 | 27.50 | 46,754 | 08:00:09 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Perfume,cosmetic,toilet Prep | 53.19M | -3.53M | -0.0515 | -5.34 | 18.82M |
From Mar 2023 to Mar 2025
TIDMCRL
RNS Number : 4811V
Creightons PLC
04 December 2023
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE UK VERSION OF THE MARKET ABUSE REGULATION NO 596/2014 WHICH IS PART OF ENGLISH LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018, AS AMED
Creightons plc
Unaudited interim financial report
for the six months ended 30 September 2023
Financial highlights
-- Sales for the first half of the financial year were GBP27.6m (2022: GBP29.7m). The Private label division saw an increase in sales of 9.8% to GBP12.3m (2022: GBP11.2m). The Contract division has seen a decline in sales of 37.1% to GBP4.9m (2022: GBP7.7m).
-- The gross profit margin increased to 42.2% (2022: 40.4%). -- Administrative costs have decreased by 5.1% to GBP9.3m (2022:GBP9.8m).
-- The operating profit before exceptional costs increased to GBP0.5m (2022: GBP0.3m). Operating profit before exceptional costs as a percentage of sales increased by 0.9% points to 1.8% (2022: 0.9%).
-- EBITDA (excluding exceptional) for the first half of the financial year 2024 was GBP1.4m (2022: GBP1.1m).
-- Diluted EPS was positive 0.37p (2022: negative 0.48p).
-- Net short-term borrowings (cash and cash equivalents less short-term element of obligations under finance leases and borrowings) at 30 September 2023 were GBP1.7m (2022: GBP4.7m). Net debt for the Group has reduced to GBP6.0m (2022: GBP9.0m).
-- Revenue generated from past acquisitions were split as follows; Brodie and Stone brands GBP1.5m (2022: GBP1.2m), Emma Hardie Ltd GBP1.5m (2022: GBP1.4m).
Operational highlights
-- The Group has responded proactively to the unprecedented challenges facing the business due to supply chain constraints, higher commodity, and energy prices. The remedial measures were intended to restore profitability, reduce costs and inventory and to return to positive cash flow. Specifically, actions were taken in the following six areas:
o Sales team continued the process of Cost Price Increase (C.P.I) monitoring across all categories of supply. This was used as the basis to negotiate sales price increases with the customers. This has proved successful.
o Manufacturing team reducing to one shift at both Peterborough (September 2022) and Devon (September 2023).
o The one shift policy continues to reduce energy costs.
o Increasing efficiency has increased capacity in each factory so as to maximise the benefit of single shift working.
o Restructuring warehousing and logistics to bring in house picking and packing of finished goods; a task that has made progress in the six months.
o We have achieved stock reductions of GBP2.4m to the end of September 2023, achieving a closing stock balance of GBP10.4m when compared to the same period in the previous year (2022: GBP12.8m) without any reduction in effective service levels to customers.
Financial overview
Sales
Net sales movements for Branded sales reduced to GBP10.4m (2022: GBP10.8m), Private label sales increased to GBP12.3m (2022: GBP11.2m) and Contract sales reduced to GBP4.9m (2022:GBP7.7m).
Hot Features
Premium
Six months Six months
ended ended
30 September 30 September
2023 2022
% Change
Movement vs Same
vs Same Period Period Last
Last Financial Financial
(Unaudited) (Unaudited) Year Year
GBP000 GBP000 GBP000
--------------- --------------- ----------------
Branded 10,417 10,774 (357) (3.3)%
--------------- --------------- ----------------
Private
Label 12,259 11,165 1,094 9.8%
--------------- --------------- ----------------
Contract 4,868 7,737 (2,869) (37.1)%
--------------- --------------- ----------------
Other 11 - 11 -
--------------- --------------- ----------------
Net sales 27,555 29,676 (2,121) (7.1)%
--------------- --------------- ---------------- -------------
The sales of the business are generated from three main revenue streams, Branded, Private label and Contract. Each of these revenue streams are reported in the statutory accounts under Revenue net of deductions. These sales related deductions consist of Contracted retailer support, Settlement discounts, and Retailer promotions. These activities are sales related activities that help generate additional revenue for the business.
When observing gross sales, the Branded sales stayed comparable year on year at GBP11.6m, Private label sales increased to GBP12.4m (2022: GBP11.4m) and Contract sales reduced to GBP4.9m (2022:GBP7.8m).
At a gross sales level, Branded sales have not experienced a decline, the Group has sacrificed revenue to foster the growth of Branded sales through Retailer support and promotions. This marketing approach is part of a long-term strategy aimed at expanding the Branded division.
Gross Profit Margin
Gross profit margin increased in the period to 42.2% (2022: 40.4%) due to the recovery from our customers of higher input costs. The Group implemented systems and processes to monitor Cost Price Increase (C.P.I) across all categories of supply. These included but were not limited to, plastics, raw materials, energy, wage inflation and transport (global and domestic) costs.
Overheads
Distribution costs have decreased by 3.9% to GBP1.9m (2022: GBP2.0m) and now represent 6.8% of sales (2022: 6.6%). Underlying costs associated with outsourcing the warehousing and third-party storage have decreased by GBP0.2m to GBP0.4m (2022: GBP0.6m). P rogress has been slower than anticipated, however a phased approach was undertaken to e nsure consistency of supply and service levels. Progress will continue to be made in the second half of the year which will have a positive impact on both costs and the efficiencies of the business going forward. Outward freight has increased by 14.3% to GBP0.8m (2022: GBP0.7m), due to increased cost of freight and the sales mix.
Administration costs have decreased by 5.2% to GBP9.3m (2022: GBP9.8m). A huge driver of the decrease in overheads was the decision made by the Group to move to a single shift. The reduction in head count accounted for GBP0.3m of the decrease when comparing the 6 months ending September 2023 to the corresponding period to September 2022. The reduction in labour has not had an impact on the output of the factory and thus has not impacted on the ability to meet customer demand. Manufacturing efficiencies have been enhanced whilst not compromising on customer delivery. The efficient utilisation of the factory along with the decrease in units sold has meant that utility costs have reduced to GBP0.3m (2022: GBP0.5m).
Operating profit before exceptional costs
Operating profit before exceptional costs was GBP0.5m (2022: GBP0.3m), which represents an increase of GBP0.2m. This is a direct result of the improvement in the gross profit margin. Strategic sales price increases that balance competitiveness with profitability have positively impacted the operating profit margin. Customer price increases have improved the gross profit margin.
Additionally, the Group has been efficient in the management of its operating costs relative to its revenue. As a result, a greater percentage of revenue is translated into profit after covering operating expenses. Operating profit margin before exceptional costs increased to 1.8% (2022: 0.9%).
Tax
The tax charge provided in the accounts is GBP0.02m (2022: GBP0.03m).
Earnings per share
The diluted earnings per share was positive 0.37p (2022: Negative 0.48p).
Dividend Payments
The Board does not propose an interim dividend (2022: Nil), reflecting the challenging and volatile economic conditions facing the Group and the need to be prudent about utilisation of cash resources. This is consistent with the directors' objective to align future dividend payments to the future underlying earnings and cash requirements of the business.
Working capital and short-term borrowings
Net short-term borrowings were GBP1.7m (2022: GBP4.7m). The increase in short term borrowings in the previous period were largely a result of the Emma Hardie acquisition, which resulted in a cash out flow of GBP2.0m. A combination of improved trading performance and reduction in stock levels has meant cash-flow has improved. The Group continues to set aggressive targets to reduce purchasing commitments. Net debt for the Group have reduced to GBP6.0m (2022: GBP9.0m). The Group has access to cash by way of an invoicing finance facility that is currently in place and could support the cash position by up to a further GBP5.7m.
Creightons plc
Unaudited interim financial report
for the six months ended 30 September 2023
Chairman's statement
Key pressures faced in the period:
As we indicated in the Chairman's statement in the financial statements to 31 March 2023, this represented among the most challenging trading years ever faced by the Group. Since November 2022 the Group faced significant supply chain and inflationary pressures. These pressures contributed to higher input and overhead costs and reduced profitability. Our response was to embark upon a six-point programme designed to restore margins, reduce costs, lower stocks levels and return the business to positive cashflow. This included moving to a single shift at the Peterborough and Devon site.
The Branded division has been challenged in the current year. There has been a significant decline in a key export market which has suffered a sharp economic downturn. We anticipate this will start to recover during the second half as orders are starting to flow through again.
As highlighted last year, the Contract side of the business continues to see reductions in order demands. This is due to brands being overstocked and therefore, requiring less manufactured stock during 2023. However, both the Private label and Branded divisions continue to gain momentum.
Key achievements in the period:
We remain committed to seeking further cost and overhead reductions and to restoring margin and overall profitability to previous levels. In spite of the significant challenges faced by the Group and the wider economy, I am pleased to report that the Group has been successful in:
- Growing the Private label division by increased Sales by an impressive 9.8% which partially offsets the decline in the Contract manufacturing business for the six-month period to 30 September 2023.
- Restoring the Gross Profit Margin to 42.2%, in line with historic levels.
- Reducing Admin and Distribution costs (excluding exceptional items) by GBP0.6m to GBP11.1m (2022: GBP11.7m).
- Improving EBITDA by GBP0.3m to GBP1.4m (2022: GBP1.1m). - Reducing stock holding by GBP2.4m to GBP10.4m (2022: GBP12.8m).
- Improving Net cash on hand by GBP3.0m to a net borrowing balance of GBP1.7m (2022: net borrowing GBP4.7m).
The Group is generating positive EBITDA, which indicates it is generating more earnings from its core business operations. Once the financial stability has been successfully achieved, the Group's focus will be to pursue new growth opportunities through continuing to invest in research and development, improving manufacturing efficiencies and expanding into new markets.
Building a team for the future:
Bernard Johnson ceased being a member of the board of directors on 24 November 2023. In addition, he also ceased serving the business in his capacity as Managing Director (MD). The process to replace him is well underway and we anticipate making a comprehensive announcement in due course. In the interim, our dedicated executive team, under the current leadership of Philippa Clark and Martin Stevens, remains fully committed to delivering effective operational management. The team is actively engaged in developing strategic plans aimed at enhancing our sales performance, achieving greater operational efficiencies, and exploring new avenues for business growth. We recognize the importance of maintaining stability and focus during this transitional period, and our collective efforts are geared towards sustaining and advancing the positive trajectory of our organisation.
Continuing to invest and build a strong middle and senior management team remains a key priority. We currently have a diverse and accomplished team which bring a wide range of experience and management across all key operational, finance, sales and marketing areas of the business. This team consists of many long serving colleagues who have developed and grown with the business as it has moved forward and navigated challenges. This has resulted in not only a strong united group working towards the same objectives, but also a team that understand the demands and changing needs of the business.
The Group's performance to date is a tribute to the tenacity and resilience of these teams who continue to demonstrate the ability to take advantage of available opportunities and manage potential risks.
Future Developments:
The Group's dynamic structure continues to give it competitive advantage allowing it to respond quickly and effectively to customer requirements. It also provides a competitive advantage with post-acquisition integration by providing synergies not available to all market participants.
Key sales priorities are in the Private Label and Branded divisions, we are therefore diverting resources from the Contract business to take advantage of growing and ongoing opportunities. This includes additional investment in digital platforms, websites and social sites supporting the promotion of our brands.
Our Research and Development team have embarked upon formulation development, attaining market knowledge and manufacturing capabilities to enter the sizeable Suncare and SPF skincare categories. This presents a significant opportunity in both the Private label and Contract manufacturing categories. It will also translate into some of our existing skincare brands.
Developing key markets in both the USA and China with our leading brands Emma H ardie and Feather & Down is a priority. Considerable time and investment has already been undertaken in China with the Emma Hardie brand where we are now launched on a number of digital platforms including Tmall and Douyin. The Feather and Down brand is launching on Amazon in both the USA and German markets, key stepping stones in securing listings with mainstream retail, whilst the Emma Hardie brand already exhibits a presence in those markets, we intend to expand in these strategic areas.
Conclusion
In common with most UK manufacturing businesses, we are operating in a period of significant inflationary pressures and weakening consumer demand. Our objective is to meet our customer expectations and to deliver top line sales growth whilst also relentlessly focusing on the areas within our control including recovery/mitigation of cost price increases, delivery of the cost reduction programme and reduction in stock levels. The margin recovery and pro-active cost reduction measures we have taken will continue to deliver an improved performance in the second half of the year.
I would like to take this opportunity to thank each and every one of the Group's employees who have continued to pull together through an exceptionally difficult period to enable the Group to deliver an improving trading performance. I would also like to thank our customers, shareholders and suppliers for their support and loyalty to the Group.
W O McIlroy
Executive Chairman 01 December 2023
Responsibility statement
The names and functions of the Directors of the Company are as follows:
William O McIlroy Executive Chairman and Chief Executive Bernard JM Johnson Executive Managing Director (ceased Directorship 24 November 2023) Nicholas DJ O'Shea Non-executive Director William T Glencross Non-executive Director Martin Stevens Deputy Managing Director Philippa Clark Deputy Managing Director Paul Forster Non-executive Director
The Board confirms that to the best of its knowledge the condensed set of financial statements gives a true and fair view of the assets and liabilities, financial position and loss of the Group and has been prepared in accordance with IAS 34 'Interim Financial Reporting', as endorsed by the UK and that the interim management report includes a fair review of the information required by the Disclosure and Transparency Rules as issued by the Financial Conduct Authority, namely:
-- DTR 4.2.7: 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 a description of the principal risks and uncertainties for the remaining six months of the financial year.
-- DTR 4.2.8: Details of related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the enterprise during that period. Together with any changes in the related party transactions described in the last annual report that could have a material effect on the enterprise in the first six months of the current financial year.
Going Concern
The Directors are pleased to report that the Group has renewed its bank facilities and continues to meet its debt obligations and expects to operate comfortably within its available borrowing facilities. The Group's cash on hand at 30 November 2023 is positive GBP0.9m. As at 31 March 2023 we carried out a review of our cash requirements for the next 12 months. Scenarios were modelled including the removal of the Group's largest customer and increases of 20% in costs of raw materials or overheads. These models are more extreme than the conditions prevailing during the 12 months to 31 March 2023 but demonstrate that even without management tackling current overhead levels or increasing prices to customers, the Group would not fully utilise available bank facilities over the next 12 months from 31 March 2023. The Directors have therefore formed a judgement, at the time of approving the Interim statement, that there is a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future being at least six months from the date of this report. For this reason, the Directors continue to adopt the going concern basis in preparing the Interim statement.
By order of the Board
Nicholas O'Shea
Non-executive Director 01 December 2023
Principal risks and uncertainties
The Board regularly monitors exposure to key risks, such as those related to production efficiencies, cash position and competitive position relating to sales. It has also taken account of the economic situation over the past 6 months, and the impact that has had on costs and consumer purchases.
It also monitors those risks not directly or specifically financial, but capable of having a major impact on the business's financial performance if there is any failure, such as product contamination and manufacture outside specification, maintenance of satisfactory levels of customer and consumer service, accident ratios, failure to meet environmental protection standards or any of the areas of regulation mentioned above.
The principal risks and uncertainties and their associated mitigating and monitoring controls which may affect the Group's performance in the next six months are consistent with those detailed in the Annual Report and Financial Statements 2023. The main risk facing the Group relates to the inflationary pressures and weak economic environment. These are covered in detail in the Chairman's statement.
Creightons plc
Unaudited interim financial report
for the six months ended 30 September 2023
Consolidated income statement - unaudited
Six months Six months Year ended
ended 30 September ended 30 September
2023 2022
31 March
2023
(Audited)
Note GBP000 GBP000 GBP000
----- -------------------- -------------------- -----------------
Revenue 27,555 29,676 58,567
----- -------------------- -------------------- -----------------
Cost of sales (15,923) (17,686) (34,219)
----- -------------------- -------------------- -----------------
Gross profit 11,632 11,990 24,348
----- -------------------- -------------------- -----------------
Distribution costs (1,874) (1,951) (3,902)
----- -------------------- -------------------- -----------------
Administrative expenses (9,252) (9,758) (18,862)
----- -------------------- -------------------- -----------------
Exceptional items - Redundancy
costs 9 - (150) (165)
-------------------------------------- ----- -------------------- -------------------- -----------------
Operating profit 506 131 1,419
----- -------------------- -------------------- -----------------
Exceptional items - Acquisition
costs 9 - (313) (312)
----- -------------------- -------------------- -----------------
Finance costs 6 (204) (177) (420)
----- -------------------- -------------------- -----------------
Profit / (Loss) before tax 302 (359) 687
----- -------------------- -------------------- -----------------
Taxation 4 (17) (26) (173)
----- -------------------- -------------------- -----------------
Profit / (Loss) for the
period from operations attributable
to the equity shareholders
of the parent Company 285 (385) 514
-------------------------------------- ----- -------------------- -------------------- -----------------
Consolidated statement of comprehensive income - Unaudited
Six months Six months Year ended
ended 30 September ended 30 September 31 March
2023 2022
2023
(Audited)
GBP000 GBP000 GBP000
---- -------------------- -------------------- -------------------
Profit / (Loss) for the
period 285 (385) 514
-------------------- -------------------- -------------------
Items that may be subsequently
reclassified to profit and
loss:
---- -------------------- -------------------- -------------------
Exchange differences on
translating foreign operations 8 (68) (9)
-------------------- -------------------- -------------------
Other comprehensive income
/ (Loss) for the period 8 (68) (9)
-------------------- -------------------- -------------------
Total comprehensive income
/ (Loss) for the period
attributable to the equity
shareholders of the parent 293 (453) 505
-------------------- -------------------- -------------------
Dividends
Note Six months Six months Year ended
ended 30 September ended 30 September 31 March
2023 2022 2023
(Unaudited) (Unaudited) (Audited)
Paid in year (GBP000) - - -
------ -------------------- -------------------- ------------
Paid in year (pence per - - -
share)
------ -------------------- -------------------- ------------
Proposed (GBP000) - - -
------ -------------------- -------------------- ------------
Proposed (pence per share) - - -
------ -------------------- -------------------- ------------
Earnings per share
Note Six months Six months Year ended
ended 30 September ended 30 September 31 March
2023 2022 2023
(Unaudited) (Unaudited) (Audited)
Basic 3 0.42p (0.55)p 0.74p
------ -------------------- -------------------- ------------
Diluted 0.37p (0.48)p 0.65p
------ -------------------- -------------------- ------------
Consolidated balance sheet - unaudited
Six months Six months Year ended
ended 30 ended 30
September September
2023 2022
31 March
2023
(Audited)
Note GBP000 GBP000 GBP000
----- ------------------- -------------------- ------------------
Non-current assets
----- ------------------- -------------------- ------------------
Goodwill 2,857 2,853 2,857
----- ------------------- -------------------- ------------------
Other intangible assets 10,931 10,883 10,894
----- ------------------- -------------------- ------------------
Property, plant and equipment 5,636 6,165 5,890
----- ------------------- -------------------- ------------------
Right-of-use assets 1,281 1,107 1,285
----- ------------------- -------------------- ------------------
20,705 21,008 20,926
----- ------------------- -------------------- ------------------
Current assets
----- ------------------- -------------------- ------------------
Inventories 10,445 12,802 10,228
----- ------------------- -------------------- ------------------
Trade and other receivables 12,474 14,518 12,733
----- ------------------- -------------------- ------------------
Cash and cash equivalents 1,681 765 1,653
----- ------------------- -------------------- ------------------
24,600 28,085 24,614
----- ------------------- -------------------- ------------------
Total assets 45,305 49,093 45,540
----- ------------------- -------------------- ------------------
Current liabilities
----- ------------------- -------------------- ------------------
Trade and other payables 9,225 11,308 9,836
----- ------------------- -------------------- ------------------
Corporation tax payable - - 3
----- ------------------- -------------------- ------------------
Lease liabilities 387 301 373
----- ------------------- -------------------- ------------------
Borrowings 3,000 5,136 2,502
----- ------------------- -------------------- ------------------
12,612 16,745 12,714
----- ------------------- -------------------- ------------------
Net current assets 11,988 11,340 11,900
----- ------------------- -------------------- ------------------
Non-current liabilities
----- ------------------- -------------------- ------------------
Deferred tax liability 2,948 3,006 2,942
----- ------------------- -------------------- ------------------
Lease liabilities 797 838 917
----- ------------------- -------------------- ------------------
Borrowings 3,031 3,900 3,488
----- ------------------- -------------------- ------------------
6,776 7,744 7,347
----- ------------------- -------------------- ------------------
Total liabilities 19,388 24,489 20,061
----- ------------------- -------------------- ------------------
Net assets 25,917 24,604 25,479
----- ------------------- -------------------- ------------------
Equity
----- ------------------- -------------------- ------------------
Share capital 700 700 700
----- ------------------- -------------------- ------------------
Share premium account 2,024 2,022 2,022
----- ------------------- -------------------- ------------------
Merger reserve 2,476 2,476 2,476
----- ------------------- -------------------- ------------------
Treasury shares 8 (576) (576) (576)
----- ------------------- -------------------- ------------------
Other reserves (211) (211) (211)
----- ------------------- -------------------- ------------------
Translation reserve 22 (45) 14
----- ------------------- -------------------- ------------------
Retained earnings 21,482 20,238 21,054
----- ------------------- -------------------- ------------------
Total equity attributable
to the equity shareholders
of the parent Company 25,917 24,604 25,479
------------------------------- ----- ------------------- -------------------- ------------------
Statement of changes in shareholders' equity - unaudited
Share Share Merger Treasury Other Translation Retained Total
capital premium reserve shares reserves reserve Earnings equity
account
------------------ ------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
At 1 April 2022 697 1,951 2,476 - (211) 23 20,742 25,678
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Comprehensive
income for the
period
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Profit for the
six-month period - - - - - - (385) (385)
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Exchange
differences
on translation
of foreign
operations - - - - - (68) - (68)
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Total
comprehensive
income for the
six months ended
30 September
2022 - - - - - (68) (385) (453)
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Contributions
by and
distributions
to owners
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Exercise of
options 3 71 - - - - - 74
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Purchase of own
shares - - - (576) - - - (576)
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Share-based
payment
charge - - - - - - 179 179
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Deferred tax
through Equity - - - - - - (298) (298)
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Dividends - - - - - - - -
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Total
contributions
by and
distributions
to owners 3 71 - (576) - - (119) (621)
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
At 30 September
2022 700 2,022 2,476 (576) (211) (45) 20,238 24,604
------------------ ------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Comprehensive
income for the
period
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Profit for the
six-month period - - - - - - 899 899
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Exchange
differences
on translation
of foreign
operations - - - - - 59 - 59
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Total
comprehensive
income for the
six months ended
31 March 2023 - - - - - 59 899 958
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Contributions -
by and
distributions
to owners
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Exercise of - - - - - - - -
options
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Share-based
payment
charge - - - - - - (78) (78)
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Deferred tax
through Equity - - - - - - (5) (5)
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Dividends - - - - - - - -
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Total
contributions
by and
distributions
to owners - - - - - - (83) (83)
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
At 31 March
2023 700 2,022 2,476 (576) (211) 14 21,054 25,479
------------- ------------------ ------------------- ----------------- ------------- ----------------- ----------------------- -------------
Share Share Merger Treasury Other Translation Retained Total
capital premium reserve shares reserves reserve Earnings equity
account
----------- ------------------ ---------- ------------ --------- ----------------- ------------ ----------
At 31 March
2023 700 2,022 2,476 (576) (211) 14 21,054 25,479
----------- ------------------ ---------- ------------ --------- ----------------- ------------ ----------
Comprehensive
income for the
period
----------- ------------------ ---------- ------------ --------- ----------------- ------------ ----------
Profit for the
six-month
period - - - - - - 285 285
----------- ------------------ ---------- ------------ --------- ----------------- ------------ ----------
Exchange
differences
on
translation
of foreign
operations - - - - - 8 - 8
----------- ------------------ ---------- ------------ --------- ----------------- ------------ ----------
Total
comprehensive
income for
the
six months
ended
30 September
2023 - - - - - 8 285 293
----------- ------------------ ---------- ------------ --------- ----------------- ------------ ----------
Contributions
by and
distributions
to owners
----------- ------------------ ---------- ------------ --------- ----------------- ------------ ----------
Exercise of
options - 2 - - - - - 2
----------- ------------------ ---------- ------------ --------- ----------------- ------------ ----------
Purchase of - - - - - - - -
own
shares
----------- ------------------ ---------- ------------ --------- ----------------- ------------ ----------
Share-based
payment
charge - - - - - - 143 143
----------- ------------------ ---------- ------------ --------- ----------------- ------------ ----------
Deferred tax - - - - - - - -
through Equity
----------- ------------------ ---------- ------------ --------- ----------------- ------------ ----------
Total
contributions
by and
distributions
to owners - 2 - - - - 143 145
----------- ------------------ ---------- ------------ --------- ----------------- ------------ ----------
At 30
September
2023 700 2,024 2,476 (576) (211) 22 21,482 25,917
--------------- ----------- ------------------ ---------- ------------ --------- ----------------- ------------ ----------
Consolidated cash flow statement - unaudited
Note Six months Six months Year ended
ended 30 ended 30 31 March
September September 2023
2023 2022
(Audited)
GBP000 GBP000 GBP000
------- ------------ ------------ ------------
Profit from operations 506 281 1,419
------- ------------ ------------ ------------
Adjustments for:
------- ------------ ------------ ------------
Depreciation on property, plant
and equipment 509 505 1,000
------- ------------ ------------ ------------
Depreciation on right of use assets 183 149 294
------- ------------ ------------ ------------
Amortisation of intangible assets 160 150 288
------- ------------ ------------ ------------
(Profit)/Loss on disposal of property,
plant and equipment (7) 8 34
------- ------------ ------------ ------------
Share based payment charge 143 179 101
------- ------------ ------------ ------------
Redundancy payments - (150) -
------- ------------ ------------ ------------
1,494 1,122 3,136
------- ------------ ------------ ------------
(Increase)/decrease in inventories (217) (323) 2,250
------- ------------ ------------ ------------
Decrease/(increase) in trade and
other receivables 259 (779) 776
------- ------------ ------------ ------------
(Decrease)/increase in trade and
other payables (611) 1,182 (288)
------- ------------ ------------ ------------
Taxation paid - (70) (62)
------- ------------ ------------ ------------
Net cash from operating activities 925 1,132 5,812
------- ------------ ------------ ------------
Investing activities
------- ------------ ------------ ------------
Purchase of property, plant and
equipment (251) (605) (825)
------- ------------ ------------ ------------
Purchase of right of use assets - (171) -
---------------------------------------- ------------ ------------ ------------
Purchase of intangible assets (197) (166) (315)
------- ------------ ------------ ------------
Acquisition of Brodie & Stone - - (75)
------- ------------ ------------ ------------
Acquisition of Emma Hardie 7 - (1,424) (1,424)
------- ------------ ------------ ------------
Net cash used in investing activities (448) (2,366) (2,639)
------- ------------ ------------ ------------
Financing activities
------- ------------ ------------ ------------
Proceeds on issue of shares 2 73 74
------- ------------ ------------ ------------
Principal paid on lease liabilities (339) (117) (436)
------- ------------ ------------ ------------
Interest paid on lease liabilities - (53) -
------- ------------ ------------ ------------
Cancellation of leases - - (35)
------- ------------ ------------ ------------
Interest paid on mortgage loan - (41) -
------- ------------ ------------ ------------
Interest paid on overdrafts and - (83) -
loans
------- ------------ ------------ ------------
(Decrease)/increase in invoice
financing facilities (454) 2,845 290
------- ------------ ------------ ------------
Increase/(decrease) of overdraft 887 (405) (600)
------- ------------ ------------ ------------
Repayment on term loan (426) (332) (816)
------- ------------ ------------ ------------
Repayment on mortgage loan facility (127) (84) (252)
------- ------------ ------------ ------------
Purchase of shares - Share buy
back 8 - (576) (576)
------- ------------ ------------ ------------
Net cash used in financing activities (457) 1,227 (2,351)
------- ------------ ------------ ------------
Net decrease in cash and cash
equivalents 20 (7) 822
------- ------------ ------------ ------------
Cash and cash equivalents at start
of period 1,653 840 840
------- ------------ ------------ ------------
Effect of foreign exchange rate
changes 8 (68) (9)
------- ------------ ------------ ------------
Cash and cash equivalents at end
of period 1,681 765 1,653
------- ------------ ------------ ------------
Notes to the unaudited interim financial report
1. Basis of preparation
The interim financial statements for the six months ended 30 September 2022 and 30 September 2023 and for the twelve months ended 31 March 2023 do not constitute statutory accounts for the purposes of Section 434 of the Companies Act 2006. The Annual Report and Financial Statements for the year ended 31 March 2023 have been filed with the Registrar of Companies. The Independent Auditors' Report on the Annual Report and Financial Statements for the year ended 31 March 2023 was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under sections 498(2) or 498(3) of the Companies Act 2006. The 30 September 2023 statements were approved by the Board of Directors on 01 December 2023. This unaudited interim report has not been audited or reviewed by auditors pursuant to the Financial Reporting Council guidance on Review of Interim Financial Information.
The condensed financial statements in this Interim Report have been prepared in accordance with the requirements of IAS 34 'Interim Financial Reporting' as endorsed by the UK.
As required by the Disclosure and Transparency Rules of the UK's Financial Conduct Authority, the condensed set of financial statements has been prepared by applying the accounting policies and presentation that were applied in the preparation on the Company's published consolidated financial statements for the year ended 31 March 2023, which were prepared in accordance with the UK-adopted international accounting standards.
The condensed interim financial statements for the six months ended 30 September 2023 and the comparative figures for the six months ended 30 September 2022 are unaudited. The figures for the year ended 31 March 2023 have been extracted from the Annual Report on which the Auditors issued an unqualified audit report and which have been filed with the Registrar of Companies.
2. Significant accounting policies
Adoption of new and revised accounting standards
No new standards impacting on the Group have been adopted in its financial statements for the year ended 31 March 2023 or the interims ended 30 September 2023.
There are a number of standards, amendments to standards, and interpretations which have been issued by the IASB that are effective in future accounting periods that the Group has decided not to adopt early. The Group does not expect any of the standards issued by the IASB, but not yet effective, to have a material impact on the Group.
3. Earnings per share - Unaudited
The calculation of the basic and diluted earnings per share is based on the following data:
Six months Six months Year ended
ended 30 ended 30 31 March
September September 2023
2023 2022
(Audited)
GBP000 GBP000 GBP000
--- ------------ ------------ ------------
Earnings
--- ------------ ------------ ------------
Net profit attributable to
the equity holders of the
parent company 285 (385) 514
------------ ------------ ------------
Six months Six months Year ended
ended 30 ended 30 31 March
September September 2023
2023 2022
(Audited)
Number Number Number
--- ------------ ------------ ------------
Number of shares
--- ------------ ------------ ------------
Weighted average number of
ordinary shares for the purposes
of basic earnings per share 68,430,950 69,832,186 69,166,461
---------------------------------------- ------------ ------------ ------------
Effect of dilutive potential
ordinary shares relating
to share options 9,141,557 9,862,002 9,534,475
------------ ------------ ------------
Weighted average number of
ordinary shares for the purposes
of diluted earnings per share 77,572,507 79,694,188 78,700,936
------------ ------------ ------------
Basic 0.42p (0.55)p 0.74p
------ -------- ------
Diluted 0.37p (0.48)p 0.65p
------ -------- ------
4. Taxation
Six months Six months Year ended
ended 30 ended 30 September 31 March
September 2022 2023
2023
(Unaudited) (Unaudited) (Audited)
---
GBP000 GBP000 GBP000
--- -------------- -------------------- ------------
Current tax (11) (43) 178
-------------- -------------------- ------------
Deferred tax liability 28 69 (5)
-------------- -------------------- ------------
Total 17 26 173
-------------- -------------------- ------------
5. Notes to cash flow statement
Analysis of changes in net debt
6 months ended 30 September Overdraft Invoice Mortgage Loan Total
2023 Financing
GBP000 GBP000 GBP000 GBP000 GBP000
---------- ----------- --------- ------- ---------
At 1 April 2023 26 1,557 2,467 1,940 5,990
---------- ----------- --------- ------- ---------
Cash flows 887 (454) (127) (426) (120)
---------- ----------- --------- ------- ---------
Interest 61 - 37 63 161
---------- ----------- --------- ------- ---------
At 30 September 2023 974 1,103 2,377 1,577 6,031
----------------------------- ---------- ----------- --------- ------- ---------
6 months ended 30 September Overdraft Invoice Mortgage Loan Total
2022 Financing
GBP000 GBP000 GBP000 GBP000 GBP000
---------- ----------- --------- ------- ---------
At 1 April 2022 495 1,267 2,642 2,645 7,049
---------- ----------- --------- ------- ---------
Cash flows (405) 2,762 (127) (402) 1,828
---------- ----------- --------- ------- ---------
Interest 83 41 35 159
---------- ----------- --------- ------- ---------
At 30 September 2022 90 4,112 2,556 2,278 9,036
----------------------------- ---------- ----------- --------- ------- ---------
12 months ended 31 Overdraft Invoice Mortgage Loan Total
March 2023 Financing
GBP000 GBP000 GBP000 GBP000
---------- ----------- --------- ------- ---------
At 1 April 2022 495 1,267 2,642 2,645 7,049
---------- ----------- --------- ------- ---------
Cash flows (600) 290 (252) (816) (1,378)
---------- ----------- --------- ------- ---------
Interest 131 - 77 111 319
---------- ----------- --------- ------- ---------
At 31 March 2023 26 1,557 2,467 1,940 5,990
----------------------------- ---------- ----------- --------- ------- ---------
6. Finance costs - Unaudited
Six months Six months Year ended
ended 30 ended 30 31 March
September September 2023
2023 2022
(Audited)
GBP000 GBP000 GBP000
---- ------------ ------------ ------------
Interest on bank overdrafts
and loans 124 83 242
------------ ------------ ------------
Interest on mortgage 37 41 77
------------ ------------ ------------
Interest on lease liabilities 43 53 101
------------ ------------ ------------
Total 204 177 420
------------ ------------ ------------
7. paid to the Sellers under the SPA of Emma Hardie Limited:
Further to the sale and purchase agreement ("SPA") relating to the acquisition of the entire share capital of Emma Hardie Limited as announced on 28 July 2021, the Group made the final payment on 25 August 2022 under the SPA. The Company and also entered a settlement and share buyback agreement with the sellers in respect of certain matters related to the acquisition.
The final payment amounted to GBP1,424,000. This consisted of two components. The first of which pertained to the SPA agreement. Under the SPA, if on the date of twelve months from completion the volume weighted average middle market quoted price of an Ordinary Share for the last 5 Business days prior to that date (as derived from the Daily Official List of London Stock Exchange Plc) were to be less than GBP1.25, then an additional amount would be payable to the sellers in cash equal to such difference in price multiplied by the number of Consideration Shares issued. This equated to GBP1,333,664. The second component was in relation to the adjustment payment and the deferred payment amounting in aggregate to GBP90,336. No further amount is due to be paid by the Group under the SPA.
8. Share Buy Back of the Consideration Shares
Separately, it has been agreed with the two sellers that the Company buy back 800,000 Consideration Shares from each of them for a consideration of GBP288,000, being an aggregate consideration of GBP576,000 (together the "Buyback"). The consideration is based on the price of 36p per ordinary share being the on-market price at the time of the transaction. The Buyback took place on 26 September 2022.
The Company holds the total of 1,600,000 re-purchased shares as treasury shares.
9. Exceptional items
Redundancy costs from the cessation of the second shift
To counteract the challenging market conditions borne by increases in supply chain costs, t he business has undertaken a significant cost reduction improvement with the objective of improving profitability. This included the move to a single shift operation in Peterborough which has been made possible by the efficiency-driven investment in the previous year. This unfortunately did result in redundancies which cost the business GBP0.15m in the period to September 2022. There have been no such redundancies in the 6-month period to 30 September 2023.
Finalisation of Emma Hardie Limited SPA liability
As at 31 March 2022, GBP1,027,500 had been accrued in anticipation of the final consideration paid to the Sellers under the SPA of Emma Hardie Limited. A further GBP84,000 had been accrued in relation to the adjustment payment and the deferred consideration as part of the SPA of Emma Hardie Limited. As discussed in note 7 the actual payment amounted to GBP1,424,000. The shortfall in the amount provided at the end of 31 March 2022 had a P&L impact of GBP312,500 in the period to September 2022. There are no such costs for the 6 month period to 30 September 2023.
10. Related party transactions
The related party transactions that occurred in the six months ended 30 September 2023 are not materially different in size or nature to those reported in the Company's Annual Report for the year ended 31 March 2023.
11. Availability of Interim Report
The Interim Report is being made available to shareholders on the Company website www.creightonsplc.com. Further copies can be obtained from the Company's Registered Office, 1210 Lincoln Road, Peterborough, PE4 6ND.
For more information:
Nicholas O'Shea, Director, Creightons plc 01733 281000 Roland Cornish, Beaumont Cornish Limited 0207 628 3396
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END
IR TJBJTMTBMBRJ
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