Half Yearly Report

 

TIDMNBI 
 
RNS Number : 8020Z 
Northbridge Industrial Services PLC 
29 September 2009 
 

 
 
29 September 2009 
 
 
Northbridge Industrial Services Plc. 
("The Group" or "Northbridge") 
 
 
Unaudited Interim Results for the six months ended 30 June 2009 
 
 
Northbridge Industrial Services plc, the industrial services and rental company 
today announces its unaudited interim results for the six month period ended 30 
June 2009. 
 
 
Financial Highlights 
 
 
  *  Profit before tax up 8.3% to GBP1.1 million (2008: GBP1.0 million) 
  *  Basic earnings per share up 8.1% to 10.7 pence (2008: 9.9 pence) and diluted 
  earnings per share of 10.6 pence (2008: 9.7 pence) 
  *  Gross Margin up by 9.9% to 64.0% (2008: 54.1%) 
  *  Group Revenue down 11.2% to GBP6.1million (2008: GBP6.9 million) 
  *  Strong cash position with net operational cash inflow of GBP2.0 million (2008: 
  GBP0.7 million) 
  *  Successful open offer to shareholders raising GBP1.5 million after costs 
  *  Interim dividend increased by 7.7% to 1.4 pence (2008: 1.3 pence) 
 
 
 
Operational Highlights 
 
 
  *  Strong growth in higher margin rental revenues, up 38% compared with first half 
  of 2008. 
  *  Continuing good performance from Northbridge Middle East and RDS 
  *  Significant contract win by Northbridge Middle East 
  *  Acquisition of a controlling interest in Tyne Technical Equipment Rental in 
  Dubai 
  *  Further investment in the Group's hire fleet of GBP2.9 million (2008 GBP0.74 
  million), including acquisition of a high pressure/high capacity compressor 
  rental fleet from Sullair for GBP1.2 million 
  *  Established sales capability in India following encouraging enquiry levels 
 
 
 
Eric Hook, Chief Executive Officer, commented: 
"We expect the Group to turn in a solid performance for the whole of 2009 
despite the economic conditions, and based on enquiries and forward orders we 
already expect a strong 2010". 
 
 
 
 
For more information please contact: 
 
 
 
 
+-------------------------------------------------------+--------------------------+ 
|          Northbridge Industrial Services plc          | 01283 531 645            | 
|          Eric Hook, CEO / Ash Mehta, Finance Director |                          | 
|                                                       |                          | 
+-------------------------------------------------------+--------------------------+ 
|          Smith & Williamson Corporate Finance Limited | 020 7131 4000            | 
|                                                       |                          | 
|          (Nominated Adviser)                          |                          | 
|          Azhic Basirov / David Jones                  |                          | 
|                                                       |                          | 
+-------------------------------------------------------+--------------------------+ 
|          Arbuthnot Securities Limited  (Broker)       | 020 7012 2000            | 
|          Alasdair Younie / Ed Burbidge                |                          | 
|                                                       |                          | 
+-------------------------------------------------------+--------------------------+ 
|          Buchanan Communications                      | 020 7466 5000            | 
|          Charles Ryland / James Strong                |                          | 
+-------------------------------------------------------+--------------------------+ 
 
 
  Chairman's statement 
 
 
I am pleased to report a period of further good progress in the Group's trading 
for the six months ended 30 June 2009 and strategic objectives being achieved. 
 
 
Against a background of continued economic uncertainty the Group's businesses 
have held up well. 
 
 
The Group's higher margin rental business is still experiencing good growth and 
the proportion of rental in the overall revenue mix is now well over 50%, 
leading to a substantial increase in the Group's gross margin. We are reaping 
the benefits of our ongoing investment in the Group's hire fleet over previous 
years. This level of expansion has continued into 2009 with a further investment 
of GBP1.7 million together with the GBP1.2 million acquisition of compressors 
which added to our portfolio of products. 
 
 
Although sales of manufactured units by Crestchic, our largest subsidiary, are 
as expected lower than last year's record levels, we are still receiving an 
encouraging level of sales enquiries. 
 
 
Northbridge Middle East ("NME"), which started trading in 2007, continues to 
grow rapidly and in April 2009 won a substantial rental contract to provide 
generators, transformers and associated equipment to the Jabali Salab zinc mine 
in Yemen. This contract will commence fully in January 2010 and is due to 
increase to the maximum level during 2010. It includes a minimum service period 
which has recently been increased from 12 months to 36 months. In April 2009, 
NME also acquired Tyne Technical Equipment Rental Services ("TTERS"), a Dubai 
registered company whose principal business is the rental of generators and the 
sale of associated services to the infrastructure and oil and gas industries in 
the United Arab Emirates. 
 
 
RDS (Technical) Ltd, ("RDS") which supplies generators and associated equipment 
to the oil and gas industry in the Caspian Region, continued to perform well. A 
new phase of investment planned to start in 2010 will benefit the Company next 
year and beyond. 
 
 
The Group's cashflow has been very strong in the first half, helped by the 
growth in rental activities. Opportunities for further rental growth are 
encouraging, particularly overseas, and to help fund this potential the Group 
raised additional capital via an open offer of new ordinary shares to existing 
shareholders in June 2009 raising GBP1.52 million before costs. During the 
period the Group purchased an existing specialist compressor hire fleet from 
Sullair at a cost of GBP1.2 million, 90 per cent of which was financed by a five 
year hire purchase agreement with Lloyds Banking Group. 
 
 
Financial results 
 
 
Northbridge's revenue for the half year was GBP6.1 million (2008: GBP6.9 
million) with gross profits of GBP3.9 million (2008: GBP3.7 million). Profit 
before taxation was GBP1.1 million (2008: GBP1.0 million). Net assets at 30 June 
2009 were GBP11.9 million (2008: GBP8.7 million) 
 
 
Basic earnings per share increased 8.1% at 10.7 pence (2008: 9.9 pence) and 
diluted earnings per share increased to 10.6 pence (2008: 9.7 pence) 
 
 
Financing and cash flow 
 
 
During the period cash generated from operations amounted to GBP2.7 million 
(2008 GBP0.9 million) and a further GBP1.5 million was raised through the open 
offer. GBP2.9 million was invested in the hire fleet and a final payment of 
GBP0.9 million was made for the Group's business premises in Dubai. Net gearing 
at the end of the period was 24.0% (2008: 29.3%). 
 
 
Dividends 
 
 
The Board has declared an increased interim dividend of 1.4 pence (2008: 1.3 
pence); an increase of 7.7%, to be paid on 13 November 2009 to shareholders on 
the register as at 16 October 2009. 
 
 
Operations 
 
 
Crestchic 
Crestchic, Northbridge's main subsidiary, saw rental demand continue to grow and 
rental revenue increased by 31% compared with last year. This benefited the 
rental/sales mix in total Group turnover and resulted in the Group's gross 
margins increasing by 9.9% to 64.0%. Crestchic experienced a reduction in the 
sale of manufactured units compared with the record level of last year. This was 
largely down to the current economic environment which has reduced demand in 
some overseas markets, principally South East Asia. The additional production 
capacity released by the fall in sales has been utilised by building more units 
for the hire fleet from which we expect a long term benefit. 
 
 
RDS (Technical) Ltd ("RDS") 
RDS which provides generators and associated equipment to the oil and gas 
industry in the Caspian region continues to trade well. A new phase of 
investment is about to start in the region from which RDS is well placed to 
benefit. During the period the holding company, which was previously a Jersey 
registered company, has been transferred to Dubai under the control of 
Northbridge Middle East. At the same time a trading branch of RDS was 
established in the Jebel Ali Free Zone. 
 
 
Northbridge (Middle East) ("NME") 
NME now acts as an agent for Crestchic products and since its formation at the 
end of 2007 has experienced good growth, with turnover in the first six months 
of 2009 increasing significantly. The final payment of GBP0.9 million has been 
made on the premises in the Jebel Ali Free zone which is now shared with RDS. 
The portfolio of products offered by Northbridge has been enhanced by the 
acquisition of a 66.7% shareholding in TTERS for a consideration of GBP170,000 
which was satisfied by GBP62,000 in cash and the issue of 80,000 Northbridge 
shares at 135 pence per share. TTERS, which is also based in Dubai, rents 
generators and associated equipment to the infrastructure and oil and gas 
industries in the United Arab Emirates.  Northbridge will acquire the remaining 
33.3% of the shares for a multiple of net profit in the year to March 2011 
subject to a maximum cost of GBP680,000 giving a total maximum consideration of 
GBP850,000.  Based on an assessment at 30 June 2009, GBP135,000 has been 
included as the expected fair value of the contingent consideration. In the year 
to December 2008 the unaudited turnover and net profits of TTERS were GBP600,000 
and GBP57,000 respectively. As part of the transaction RDS has provided an 
intercompany loan of GBP250,000 for further investment in the hire fleet. In 
order for the maximum consideration to be payable TTERS will need to generate 
pre tax profits of GBP250,000 in the year to March 2011. 
 
 
In April 2009 the new branch of RDS won a significant contract for the supply of 
generators, transformers and associated equipment together with a maintenance 
agreement to the Jabali Zinc Project in Yemen, which is controlled by Zincox 
Resources plc, an AIM-quoted company. The contract is due to start later this 
year and will increase to the maximum capacity in 2010. There is a minimum 
service period, at the maximum capacity, of 12 months with a value of US $2.9 
million p.a. In September 2009, the contract was extended for a further 24 
months. 
 
 
Rest of the World 
As well as having sales agents and salespeople in North America, South America, 
Continental Europe and the Far East, the Group has recently employed a sales 
representative in India. This follows a number of successful conferences and 
exhibitions held in India over the last few months. Based on those events we 
believe that India offers interesting opportunities for the Group. 
 
 
Outlook 
 
 
Trading has remained stable in all our activities during the first half of 2009 
and our enquiry level remains high despite the global economic uncertainty. 
Higher margin rental continues to grow and the extra investment made this year 
will show early returns in 2010 and beyond. We look forward to reporting further 
progress in the Group's activities for the year ending 31 December 2009, and 
based on sales enquiries and our order book we already expect a strong 2010. 
 
 
Peter Harris 
Chairman 
  Northbridge Industrial Services plc 
Consolidated Statement of Comprehensive Income 
For the six months ended 30 June 2009 
 
 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |                  6 |                  6 |              Year | 
|                                               |             Months |             Months |                to | 
|                                               |              ended |              ended |              31st | 
|                                               |               30th |               30th |          December | 
|                                               |               June |               June |              2008 | 
|                                               |               2009 |               2008 |                   | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |          Unaudited |          Unaudited |           Audited | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |           GBP000's |           GBP000's |          GBP000's | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |                    |                    |                   | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Revenue                              |              6,101 |              6,870 |            15,734 | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |                    |                    |                   | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Cost of sales                        |            (2,195) |            (3,152) |           (7,711) | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |            ------- |            ------- |           ------- | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Gross profit                         |              3,906 |              3,718 |             8,023 | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |                    |                    |                   | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Selling and distribution costs       |            (1,596) |            (1,765) |           (2,747) | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Administrative expenses              |            (1,113) |              (886) |           (2,129) | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |            ------- |            ------- |           ------- | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Profit from operations               |              1,197 |              1,067 |             3,147 | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Finance income                       |                  - |                 17 |                23 | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Finance costs                        |               (78) |               (50) |             (203) | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |            ------- |            ------- |           ------- | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Profit before income tax             |              1,119 |              1,034 |             2,967 | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |                    |                    |                   | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Income tax expense (Note 3)          |              (313) |              (286) |           (1,049) | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |            ------- |            ------- |           ------- | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Profit for the period attributable   |                806 |                748 |             1,918 | 
|          to the equity holders of the parent  |                    |                    |                   | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |                    |                    |                   | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Other comprehensive income:          |                    |                    |                   | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Exchange differences on translating  |              (200) |                  - |               178 | 
|          foreign operations                   |                    |                    |                   | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |            ------- |            ------- |           ------- | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Other comprehensive income for the   |              (200) |                  - |               178 | 
|          period, net of tax                   |                    |                    |                   | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |            ------- |            ------- |           ------- | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Total comprehensive income for the   |                606 |                748 |             2,096 | 
|          period attributable to equity        |                    |                    |                   | 
|          holders of the parent                |                    |                    |                   | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |            ------- |            ------- |           ------- | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Earnings per share (Note 5)          |                    |                    |                   | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          - basic (pence)                      |               10.7 |                9.9 |              25.3 | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          - diluted (pence)                    |               10.6 |                9.7 |              25.0 | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|                                               |                    |                    |                   | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
|          Dividend per share                   |               1.4p |               1.3p |              2.6p | 
+-----------------------------------------------+--------------------+--------------------+-------------------+ 
 
 
All revenue and operating profit is derived from continuing operations. 
 
 
  Northbridge Industrial Services plc 
Consolidated Balance sheet as at 30th June 2009 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                     30th |               30th |              31st | 
|                                          |                                     June |               June |          December | 
|                                          |                                     2009 |               2008 |              2008 | 
|                                          |                                          |                    |           Audited | 
|                                          |                                Unaudited |          Unaudited |                   | 
+                                          +------------------------------------------+--------------------+-------------------+ 
|                                          |                                 GBP000's |           GBP000's |          GBP000's | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Assets                          |                                          |                    |                   | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Non-current assets              |                                          |                    |                   | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Intangible assets               |                                    3,526 |              3,210 |             3,159 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Property plant & equipment      |                                   11,332 |              7,387 |             8,675 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                  ------- |            ------- |           ------- | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|           Total non-current assets       |                                   14,858 |             10,597 |            11,834 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                          |                    |                   | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Current assets                  |                                          |                    |                   | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Inventories                     |                                    1,290 |              1,477 |             1,096 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Trade & other receivables       |                                    3,547 |              4,270 |             4,085 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Cash and cash equivalents       |                                    1,885 |              1,209 |             2,078 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                  ------- |            ------- |           ------- | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|           Total current assets           |                                    6,722 |              6,956 |             7,259 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                  ------- |            ------- |           ------- | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Total assets                    |                                   21,580 |             17,553 |            19,093 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                  ------- |            ------- |           ------- | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Liabilities                     |                                          |                    |                   | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Current liabilities             |                                          |                    |                   | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Bank overdraft                  |                                        - |              (597) |                 - | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Trade & other payables          |                                  (2,555) |            (2,710) |           (2,384) | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Financial liabilities           |                                    (603) |              (316) |           (1,966) | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Other financial liabilities     |                                  (1,941) |              (810) |             (988) | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Tax liabilities                 |                                  (1,135) |              (703) |           (1,386) | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                  ------- |            ------- |           ------- | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                  (6,234) |            (5,136) |           (6,724) | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Non-current liabilities         |                                          |                    |                   | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Financial liabilities           |                                  (2,420) |            (2,859) |           (1,502) | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Long-term provisions            |                                    (347) |              (212) |             (212) | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Deferred tax liability          |                                    (683) |              (604) |             (683) | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                  ------- |            ------- |           ------- | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                  (3,450) |            (3,675) |           (2,397) | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                  ------- |            ------- |           ------- | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Total liabilities               |                                  (9,684) |            (8,811) |           (9,121) | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                  ------- |            ------- |           ------- | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Total net assets                |                                   11,896 |              8,742 |             9,972 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                  ------- |            ------- |           ------- | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Equity attributable to equity   |                                          |                    |                   | 
|          holders of the parent           |                                          |                    |                   | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Share capital                   |                                      909 |                763 |               763 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Share premium account           |                                    6,966 |              5,546 |             5,546 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Treasury share reserve          |                                    (201) |               (59) |             (117) | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Foreign exchange reserve        |                                     (22) |               (17) |               178 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|          Retained earnings               |                                    4,244 |              2,509 |             3,602 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                  ------- |            ------- |           ------- | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|           Total equity                   |                                   11,896 |              8,742 |             9,972 | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
|                                          |                                  ------- |            ------- |           ------- | 
+------------------------------------------+------------------------------------------+--------------------+-------------------+ 
  Northbridge Industrial Services plc 
Consolidated Statement of Cash Flows 
For the six months ended 30 June 2009 
 
 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|                                         |                  6 |                  6 |              Year | 
|                                         |             Months |             Months |                to | 
|                                         |              ended |              ended |              31st | 
|                                         |           30thJune |           30thJune |          December | 
|                                         |               2009 |               2008 |              2008 | 
|                                         |          Unaudited |          Unaudited |          Audited  | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|                                         |           GBP000's |           GBP000's |          GBP000's | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Operating activities           |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Net profit from ordinary       |              1,119 |              1,034 |             2,967 | 
|          activities before taxation     |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Adjustments for:               |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|            Foreign exchange gains       |                 28 |                  - |             (620) | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|            Amortisation of intangible   |                 63 |                 58 |                95 | 
|          fixed assets                   |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|            Amortisation of capitalised  |                  1 |                 10 |                92 | 
|          debt fee                       |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|            Depreciation of property     |                399 |                374 |               715 | 
|          plant and equipment            |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|            (Loss)/profit on disposal of |                 10 |                  - |              (54) | 
|          property plant and equipment   |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|            Finance income               |                  - |               (16) |              (23) | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Finance costs                  |                 78 |                 50 |               203 | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Share option expense           |                 30 |                 25 |                45 | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|                                         |            ------- |            ------- |           ------- | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|                                         |              1,728 |              1,535 |             3,420 | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          (Increase)/decrease in         |              (187) |              (341) |                40 | 
|          inventories                    |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Decrease/(increase) in         |              1,022 |              (998) |             (424) | 
|          receivables                    |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Increase in payables           |                 90 |                740 |               385 | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|                                         |            ------- |            ------- |           ------- | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Cash generated from operations |              2,653 |                936 |             3,421 | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Finance costs                  |               (78) |               (50) |             (203) | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Taxation                       |              (565) |              (172) |             (173) | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|                                         |            ------- |            ------- |           ------- | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Net cash from operating        |              2,010 |                714 |             3,045 | 
|          activities                     |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|                                         |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Cash flows from investing      |                    |                    |                   | 
|          activities                     |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Finance income                 |                  - |                 16 |                23 | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Acquisition of subsidiary      |            (1,061) |            (1,164) |           (1,150) | 
|          undertaking (net of cash       |                    |                    |                   | 
|          acquired)                      |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Sale of property, plant and    |                 45 |                 39 |               480 | 
|          equipment                      |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Purchase of property, plant    |            (1,947) |            (1,592) |           (2,925) | 
|          and equipment (Note 4)         |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|                                         |            ------- |            ------- |           ------- | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Net cash used in investing     |            (2,963) |            (2,701) |           (3,572) | 
|          activities                     |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|                                         |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Cash flows from financing      |                    |                    |                   | 
|          activities                     |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Proceeds from share capital    |              1,459 |                  - |                 - | 
|          issued                         |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Proceeds from bank borrowings  |                  - |              1,750 |             1,626 | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Repayment of bank borrowings   |               (41) |               (50) |              (64) | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Payment of finance lease       |              (178) |               (50) |             (196) | 
|          obligations                    |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Purchase of own shares         |               (85) |                  - |              (58) | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Dividends paid to equity       |              (194) |              (153) |             (250) | 
|          shareholders                   |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|                                         |            ------- |            ------- |           ------- | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Net cash flow (used in)/from   |                961 |              1,497 |             1,058 | 
|          financing activities           |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|                                         |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Net (decrease)/ increase in    |                  8 |              (490) |               531 | 
|          cash                           |                    |                    |                   | 
|          and cash equivalents           |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Cash and cash equivalents at   |              2,078 |              1,102 |             1,102 | 
|          beginning of period            |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Exchange differences on cash   |              (201) |                  - |               445 | 
|          and cash equivalents           |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
|          Cash and cash equivalents at   |              1,885 |                612 |             2,078 | 
|          end of period                  |                    |                    |                   | 
+-----------------------------------------+--------------------+--------------------+-------------------+ 
  Notes to the unaudited interim statements 
Northbridge Industrial Services plc 
 
 
 
 
1.  Basis of preparation 
 
 
This half-yearly financial report has been prepared in accordance with the 
accounting policies disclosed in the full statutory accounts for the year ended 
31 December 2008. 
 
 
These policies are in accordance with International Financial Reporting 
Standards, International Accounting Standards and Interpretations (collectively 
IFRSs) issued by the International Accounting Standards Board as endorsed for 
use in the European Union, that are expected to be applicable for the year ended 
31 December 2009. 
 
 
The Group has chosen not to adopt IAS 34 'Interim Financial Statements' in 
preparing the interim consolidated financial information. 
 
 
The comparatives for the full year ended 31 December 2008 are not the Group's 
full statutory accounts for that year. A copy of the statutory accounts for that 
year has been delivered to the Registrar of Companies. The auditors' report on 
those accounts was unqualified, did not include references to any matters to 
which the auditors drew attention by way of emphasis without qualifying their 
report and did not contain a statement under section 237(2)-(3) of the Companies 
Act 1985. 
 
 
The interim report for the period ended 30 June 2009 was approved by the board 
of directors on 29 September 2009. 
 
 
2.  Acquisitions 
 
 
Tyne Technical Equipment Rental Services 
 
 
During the period, the Group purchased 66.67% of the interests of TTERS. TTERS 
is a Dubai registered company whose principal business is the rental of 
generators and the sale of associated services to the infrastructure and the oil 
and gas industries in the United Arab Emirates. The total consideration was 
GBP170,000, which was satisfied by GBP62,000 in cash and by the issue of 80,000 
new ordinary shares at a price of 135 pence per ordinary share. Additionally, 
Northbridge will acquire the remaining 33.33% of the shares in the company on 13 
April 2011 for a price based on a multiple of net profits in the preceding 12 
months, subject to a maximum cost of GBP680,000 (and a total maximum cost of 
GBP850,000). At this level of consideration the profit before taxation of TTERS 
would be GBP250,000. Based on an assessment at 30 June 2009, GBP135,000 has been 
included as the expected fair value of the contingent consideration. The shares 
issued to the vendors as consideration are to be held for a minimum period of 24 
months. 
 
 
Details of the fair value of identifiable assets and liabilities acquired, 
purchase consideration and goodwill are as follows: 
 
 
+---------------------------------------------------+--------------+--------------+ 
| Fair value of assets acquired                     |      GBP'000 |      GBP'000 | 
+---------------------------------------------------+--------------+--------------+ 
|                                                   |              |              | 
+---------------------------------------------------+--------------+--------------+ 
| Property, plant and equipment                     |          297 |              | 
+---------------------------------------------------+--------------+--------------+ 
| Current assets                                    |          108 |              | 
+---------------------------------------------------+--------------+--------------+ 
| Contract and customer related intangible assets   |          124 |              | 
| (recognised on acquisition)                       |              |              | 
+---------------------------------------------------+--------------+--------------+ 
| Other payables                                    |        (340) |              | 
+---------------------------------------------------+--------------+--------------+ 
| Deferred tax liability                            |         (35) |              | 
+---------------------------------------------------+--------------+--------------+ 
|                                                   |              |          154 | 
+---------------------------------------------------+--------------+--------------+ 
| Consideration paid                                |              |              | 
+---------------------------------------------------+--------------+--------------+ 
|                                                   |              |              | 
+---------------------------------------------------+--------------+--------------+ 
| Cash                                              |           62 |              | 
+---------------------------------------------------+--------------+--------------+ 
| Shares                                            |          108 |              | 
+---------------------------------------------------+--------------+--------------+ 
| Fair value of contingent consideration            |          135 |              | 
+---------------------------------------------------+--------------+--------------+ 
| Costs of acquisition                              |           12 |              | 
+---------------------------------------------------+--------------+--------------+ 
|                                                   |              |          317 | 
+---------------------------------------------------+--------------+--------------+ 
| Goodwill                                          |              |          163 | 
+---------------------------------------------------+--------------+--------------+ 
 
 
The net cash sum expended on the acquisition was as follows: 
+------------------------------+------------+------------+---------+--------------+ 
|                                                        |         |      GBP'000 | 
+--------------------------------------------------------+---------+--------------+ 
|                                                        |         |              | 
+--------------------------------------------------------+---------+--------------+ 
| Cash paid as consideration                             |         |           62 | 
+--------------------------------------------------------+---------+--------------+ 
| Cash paid as acquisition expenses                      |         |           12 | 
+--------------------------------------------------------+---------+--------------+ 
| Less cash acquired on acquisition                      |         |   (1)        | 
+--------------------------------------------------------+---------+--------------+ 
| Net cash movement            |            |            |         |   73         | 
+------------------------------+------------+------------+---------+--------------+ 
 
 
The main factors leading to the recognition of goodwill are the presence of 
certain intangible assets in the acquired entity, such as trading licenses 
required to operate in Dubai, and the assembled work force of the acquired 
entity which do not qualify for separate recognition. 
 
 
It is impractical to determine the IFRS carrying amounts of the assets and 
liabilities (other than the contracts and customer lists) of TTERS immediately 
prior to acquisition as the business did not prepare accounts under IFRS. 
 
 
3.  Tax on profit on ordinary activities 
 
 
The anticipated taxation rate on profits is estimated to be approximately 28%. 
 
 
4.  Property, plant and Equipment 
 
 
During the period the Group acquired property, plant and equipment with an 
aggregate cost of GBP3,186,000 (2008: GBP2,402,000) of which GBP1,239,000 (2008: 
GBP810,000) was acquired by means of finance leases. Cash payments of 
GBP1,947,000 (2008: GBP1,592,000) were made to purchase property, plant and 
equipment. 
 
 
5.  Earnings per share 
 
 
The earnings per share figure has been calculated by dividing the profit after 
taxation, GBP806,000, (2008: GBP748,000) by the weighted average number of 
shares in issue, 7,527,908 (2008: 7,550,149). The diluted earnings per share 
assumes all share options are exercised at the start of the period or, if later, 
the date of issue of the share options. At the end of the period, the company 
had in issue 469,229 (2008: 40,000) share options which have not been included 
in the calculation of the diluted earnings per share because their effects are 
anti-dilutive. These share options could be dilutive in the future. 
 
 
 6.  Dividends 
 
 
An interim dividend of 1.4 pence per share (2008: 1.3 pence) will be paid on 
13 November 2009 to shareholders on the register as at 16 October 2009. In 
accordance with IFRS, no provision for the interim dividend has been made in 
these financial statements 
 
 
7.  Interim report 
 
 
Copies of the interim report are being sent to all shareholders and are 
available to the public from the offices of Northbridge Industrial Services plc 
at Second Avenue, Centrum 100, Burton-on-Trent, Staffordshire, DE14 2WF. The 
interim report and this interim announcement will also be available from the 
Group's website at www.northbridgegroup.co.uk . 
 
 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
 IR PUUCABUPBGQR