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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Delta | LSE:DLTA | London | Ordinary Share | GB0002615069 |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 184.75 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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RNS Number:3213P
Delta PLC
02 September 2003
Wednesday 3rd September 2003
DELTA plc INTERIM RESULTS 2003
Highlights
* Sales for continuing businesses increased during the first half and
profits for the period are in line to meet the board's expectations for
the full year.
* With the declaration of a 1.5p interim dividend, the Group's dividend has
been rebased to reflect the Group's size, earnings and available cash
flow.
First half First half
# million 2003 2002
Continuing turnover #146.4 #123.9
Continuing pre-tax profit** #14.8 #11.0
Pre-tax profit #13.2 #0.3
Earnings per share* 3.8p 4.4p
Continuing earnings per share** 3.7p 1.5p
Interim dividend per share 1.5p 3.5p
* Before exceptional items of #1.5 million (2002 #14.1 million) and
goodwill amortisation of #0.4 million (2002 #2.3 million)
* * Before exceptional items and goodwill amortisation as above and
discontinued businesses
Commenting on today's results, Delta's Chief Executive, Todd Atkinson said:
"Following the sale of the Electrical Division, the Group now has a strong
balance sheet and a renewed focus on our remaining businesses. In order to
maximise the long term returns for our shareholders, we have commenced a full
review to determine the long-term strategy for the Group and our immediate
priorities are to focus all necessary management resource on the financial
performance of our remaining businesses, including cost reduction, as well as on
the Group's cash position. Given the Group's current size and earnings, as well
as the cash flows available to the Group from Delta Electrical Industries and
other partly owned businesses, the Group's dividend has been rebased with the
declaration of a 1.5p interim dividend."
-1-
Interim Report
for the half-year
to 28 June 2003
Group Results
Group turnover on a continuing basis was #146.4 million (2002 #123.9 million)
with profits before tax, goodwill amortisation and exceptional items of #14.8
million (2002 #11.0 million). Group earnings per share before goodwill
amortisation and exceptional items was 3.8p (2002 4.4p) and excluding
discontinued businesses was 3.7p (2002 1.5p).
Group costs of #2.4 million reduced compared to the same period (2002 #3.0
million) reflecting cost reduction programmes in the London Head Office. An
operating exceptional of #1.2 million was taken in the period relating to those
cost reductions.
Following the receipt of the proceeds from the sale of the Electrical Division
and the elimination of net debt, the Group interest charge of #1.8 million
represents a significant reduction on the previous period (2002 #4.0 million)
and mainly relates to the costs of hedging and currency movements. Given the
reduced size and geographical spread of the Group, the elimination of net debt
from the balance sheet and the costs of undertaking certain hedging
transactions, as previously announced the Group has ceased to hedge the net
asset value of overseas balance sheets denominated in foreign currencies. Other
elements of Group Treasury policy, including transaction and interest rate
hedging, will remain the same.
At the period end the Group had net cash of #29.3 million compared to net debt
of #46.4 million at the end of 2002. Since the year end, the Group's cash
position has been reduced by working capital requirements following the year end
reduction of working capital, particularly at the former Electrical Division.
In addition foreign exchange contracts used to hedge overseas balance sheets
have required substantial cash payments since the period end as a result of the
continued strengthening, in particular, of the South African Rand and Australian
Dollar. The Sterling value of the related assets has appreciated
correspondingly.
Profit before tax was #13.2 million compared with #0.3 million in the previous
year.
Taxation was #5.8 million representing an underlying effective tax rate of 39%
(2002 53%) on profit before goodwill amortisation and exceptional items
Results from the triennial valuation of the Delta Pension Plan are awaited. The
valuation is most likely to confirm that the former pension plan surplus has
been replaced by a deficit. Annual cash contributions to the plan are likely to
be required in the current year and going forward following several years
contribution holiday.
Trading
Although the earnings of the Group's several overseas businesses were affected
by significant movements during the period in our main trading currencies, the
overall result was in line with the Board's expectations.
Profits in Specialty Chemicals increased to #11.2 million (2002 #10.9 million)
on sales 16% higher at #91.2 million (2002 #78.3 million). Our EMD business
increased volumes and market share partly offsetting lower product prices.
Profits from a favourable foreign exchange contract and reduced costs have
offset unfavourable currency movements resulting in the improved first half
performance. Although the strength of the Rand and Australian dollar during the
period adversely affected the translated costs of our South African and
Australian EMD manufacturing operations, Delta EMD remains the lowest cost
producer outside China. Recent announcements by two major competitors that they
are suspending or reducing capacity should assist in restoring the balance
between the demand and supply of EMD globally.
As previously announced by Delta Electrical Industries, on 31 July, a US
competitor in the EMD market initiated an anti-dumping duty investigation of
imports of EMD from Australia, Greece, Ireland, Japan, South Africa and China.
Expert legal advice is currently being taken and the action will be opposed.
During the period the performance of our associate company, Manganese Metal
Company, has been adversely affected by currency movements. With costs in Rand
and sales in US Dollars, our 49% share of the business made a loss before
interest of #0.2 million during the first half of the current year compared to a
profit of #3.5 million in the same period in 2002. Lower US dollar selling
prices also contributed to the poor performance.
-2-
Galvanizing results improved overall during the period mainly through the
additional earnings from Webforge which was acquired in February and has
performed in line with expectations. The performance of our Asia Pacific
galvanizing operations has declined during the period due to a disappointing
performance of our plant in the Philippines. The performance of our US
galvanizing operations remains unsatisfactory with the US economic climate and
excess galvanizing capacity leading to continuing losses from these operations.
Profits in our Industrial Supplies businesses in Australia and South Africa
increased by 56% to #7.8 million (2002 #5.0 million) on sales of #72.0 million
(2002 #62.8 million). The growth in profits reflects improved performance and
the benefits on translation of the earnings from these businesses into Sterling.
Dividend
In order to re-base the dividend in line with the reshaped business and the cash
flow now available to the Group, the Board has declared an interim dividend of
1.5p (2002 3.5p) payable on 1 December 2003 to members registered on 12
September 2003. The Group's future dividend policy will be determined upon
conclusion of the Group's strategic review.
Appointment of Auditors
The Group has been conducting reviews of the services provided by its advisers,
including external auditors. As part of this process, the Board initiated a
tender for external auditors. As a result, the Board has appointed Deloitte &
Touche as external auditors in place of PricewaterhouseCoopers who have
resigned. The Group now has the same auditors throughout its operations.
Strategy
Since his appointment as Chief Executive in July, Todd Atkinson has been leading
a full review of the Group's remaining businesses as well as the Group's long-
term strategy. Whilst that strategic review is undertaken, the Group's immediate
priorities are to focus on cost reduction, financial performance and cash in
order to generate a satisfactory return from all our businesses. We also will
continue to reduce the levels of overheads in line with the smaller Group and
will focus on further reducing the Group's effective tax rate.
Summary and Outlook
Following the sale of the Electrical Division, the Group has a strong balance
sheet and a more focused business. The results of EMD and Manganese Metal
Company, as well as the results of the Group as a whole given the Group's
overseas earnings, will be affected by currency movements. Challenges remain,
particularly with regard to US Galvanizing and Manganese Metal Company. With
renewed focus on cost reduction and financial performance, we expect the
underlying performance of most of the Group's businesses to improve.
Delta plc Sir Martin Jacomb
1 Kingsway Chairman
London WC2B 6NP 3 September 2003
-3-
Group profit and loss account
For the half-year ended 28 June 2003
2003
Con- Discon- Total
tinuing tinued unaudited
Notes # million # million # million
Turnover
Existing operations 148.2 16.2 164.4
Acquisitions 15.0 - 15.0
Total turnover 163.2 16.2 179.4
Less share of joint ventures and associates (16.8) (0.6) (17.4)
Group turnover 146.4 15.6 162.0
Operating profit
Existing operations 13.0 0.1 13.1
Acquisitions 1.5 - 1.5
Group operating profit 14.5 0.1 14.6
Share of profits of joint ventures and associates 0.5 (0.1) 0.4
Total operating profit 15.0 - 15.0
Disposal of businesses 2 - (80.2) (80.2)
Use of provision made in previous year 2 - 80.2 80.2
Profit on ordinary activities before interest 15.0 - 15.0
Net interest - parent and subsidiaries 3 (1.9) - (1.9)
- joint ventures and associates 0.1 - 0.1
Profit on ordinary activities before taxation,
exceptional items and goodwill amortisation 14.8 0.3 15.1
Operating exceptional items and goodwill amortisation (1.6) (0.3) (1.9)
Non-operating exceptional items - - -
Profit on ordinary activities before taxation 13.2 - 13.2
Taxation 4 (5.8) - (5.8)
Profit on ordinary activities after taxation 7.4 - 7.4
Minority interests (3.4) - (3.4)
Profit for the period 4.0 - 4.0
Dividends (2.2) - (2.2)
Transfer to reserves 1.8 - 1.8
Basic earnings per 25p ordinary share 6 2.6p 2.6p
Basic earnings per 25p ordinary share before
goodwill amortisation 6 2.9p 2.9p
Basic earnings per 25p ordinary share before exceptional items
and goodwill amortisation 6 3.7p 3.8p
Ordinary dividends
Per 25p ordinary share 1.5p
Amount #2.1m
For 2002 comparative figures see following page
-4-
Group profit and loss account - 2002 comparative figures
For the half-year ended 28 June 2003
Half-year to 29 June 2002 Year to 28
December
2002
Con- Discon- Total Total
tinuing tinued unaudited audited
Notes # million # million # million # million
Turnover
Existing operations 141.1 143.4 284.5 542.3
Acquisitions - - - -
Total turnover 141.1 143.4 284.5 542.3
Less share of joint ventures and associates (17.2) (4.4) (21.6) (42.2)
Group turnover 123.9 139.0 262.9 500.1
Operating profit
Existing operations 8.2 2.2 10.4 24.5
Acquisitions - - - -
Group operating profit 8.2 2.2 10.4 24.5
Share of profits of joint ventures and associates 4.4 - 4.4 6.1
Total operating profit 12.6 2.2 14.8 30.6
Disposal of businesses 2 - (12.8) (12.8) (21.9)
Use of provision made in previous year 2 - 6.0 6.0 12.3
Provision for diminution in value of businesses to
be disposed of 2 - (3.7) (3.7) (92.0)
Profit (loss) on ordinary activities before interest 12.6 (8.3) 4.3 (71.0)
Net interest - parent and subsidiaries 3 (2.4) (2.0) (4.4) (7.5)
- joint ventures and associates 0.5 (0.1) 0.4 1.0
Profit on ordinary activities before taxation,
exceptional items and goodwill amortisation 11.0 5.7 16.7 35.8
Operating exceptional items and goodwill amortisation (0.3) (5.6) (5.9) (10.2)
Exceptional interest - - - (1.5)
Non-operating exceptional items - (10.5) (10.5) (101.6)
Profit (loss) on ordinary activities before taxation 10.7 (10.4) 0.3 (77.5)
Taxation 4 (5.9) (1.1) (7.0) (14.1)
(Loss) profit on ordinary activities after taxation 4.8 (11.5) (6.7) (91.6)
Minority interests (2.8) (0.2) (3.0) (8.3)
(Loss) profit for the period 2.0 (11.7) (9.7) (99.9)
Dividends (5.4) - (5.4) (12.2)
Transfer from reserves (3.4) (11.7) (15.1) (112.1)
Basic (loss) per 25p ordinary share 6 (1.3)p (6.5)p (66.4)p
Basic (loss) earnings per 25p ordinary share before
goodwill amortisation 6 1.5p (5.0)p (63.5)p
Basic earnings per 25p ordinary share before exceptional
items and goodwill amortisation 6 1.5p 4.4p 8.8p
Ordinary dividends
Per 25p ordinary share 3.5p 8.0p
Amount #5.3m #12.1m
For 2003 see preceding page
-5-
Group balance sheet
At 28 June 2003
2003 2002
Half-year to
Half-year to 29 June Year to
28 June (restated) 28 December
unaudited unaudited audited
# million # million # million
Fixed assets
Intangible assets - goodwill 10.8 71.0 10.1
Tangible assets 107.5 166.5 152.5
Investments - joint ventures 1.7 2.9 2.8
associated companies 21.7 20.7 20.8
other investments 0.3 0.6 0.6
142.0 261.7 186.8
Current assets
Stocks 59.0 97.7 91.6
Debtors - amounts falling due after one year 7.7 9.0 7.3
Debtors - amounts falling due within one year 73.1 105.8 99.5
Investments - money market funds 0.5 2.4 0.4
Investments - other 4.6 2.6 5.4
5.1 5.0 5.8
Bank and other deposits 39.0 50.2 51.8
183.9 267.7 256.0
Creditors - amounts falling due within one year
Borrowings (13.6) (122.4) (99.6)
Other creditors (84.0) (112.3) (128.1)
Net current assets 86.3 33.0 28.3
Total assets less current liabilities 228.3 294.7 215.1
Creditors - amounts falling due after more than one year
Borrowings (1.2) (4.0) (4.4)
Provisions for liabilities and charges (25.0) (11.5) (12.3)
Net assets 202.1 279.2 198.4
Capital and reserves
Called up share capital 40.7 40.4 40.6
Share premium account and other reserves 91.0 83.6 77.3
Profit and loss account 30.9 121.3 42.8
Equity shareholders' funds 159.8 242.5 157.9
Non-equity shareholders' funds 2.8 2.8 2.8
Total shareholders' funds 162.6 245.3 160.7
Equity minority interests 39.5 33.9 37.7
202.1 279.2 198.4
-6-
Group cash flow statement
for the half-year
to 28 June 2003
2003 2002
Half-year to Half-year to Year to
28 June 29 June 28 December
unaudited unaudited audited
Notes # million # million # million
Net cash (outflow) inflow from operating activities 7 (8.2) 4.2 49.2
Dividends received from associates - 1.2 3.6
Returns on investments and servicing of finance
Interest paid less received (2.7) (5.5) (6.7)
Preference dividends paid (0.1) (0.1) (0.1)
Dividends paid to minority shareholders (3.0) (2.5) (4.8)
Net cash outflow from returns on investments
and servicing of finance (5.8) (8.1) (11.6)
Taxation (3.3) (5.7) (13.6)
Capital expenditure and financial investment
Purchase of tangible fixed assets (6.1) (10.1) (18.9)
Sale of tangible fixed assets 0.7 0.5 0.9
Associated company and joint venture loans - (0.5) (0.8)
Net cash outflow from capital expenditure and financial investment (5.4) (10.1) (18.8)
Acquisitions and disposals
Purchase of businesses (18.6) (0.7) (1.8)
Sale of businesses 125.5 14.3 14.9
Net cash disposed of on sale of businesses (1.9) (1.7) (1.9)
Net cash inflow from acquisitions and disposals 105.0 11.9 11.2
Equity dividends paid (6.8) (6.7) (12.1)
Cash inflow (outflow) before use of liquid
resources and financing 75.5 (13.3) 7.9
Management of liquid resources
Decrease in short term cash deposits and current
asset investments 14.1 15.4 6.0
Financing
Issue of ordinary share capital 0.1 0.8 0.7
Debt due within one year: increase in short term borrowings 0.3 43.9 29.4
repayment of short term borrowings (93.4) (11.2) (14.9)
Debt due after one year: increase in loans - - 7.8
repayment of loans (0.1) (17.7) (26.4)
Net cash (outflow) inflow from financing (93.1) 15.8 (3.4)
(Decrease) increase in cash in the period 8 (3.5) 17.9 10.5
-7-
Statement of total recognised gains and losses
2003 2002
Half-year to Half-year to Year to
28 June 29 June 28 December
unaudited unaudited audited
# million # million # million
Profit (loss) for the period 4.0 (9.7) (99.9)
Other recognised gains (losses) for the period:
Currency translation differences on foreign currency net investments - 0.5 (1.3)
Total recognised gains (losses) for the period 4.0 (9.2) (101.2)
Prior year adjustment (note 1) - 0.7 0.7
Total gains (losses) recognised 4.0 (8.5) (100.5)
Movements in shareholders' funds
Profit (loss) for the period 4.0 (9.7) (99.9)
Dividends (2.2) (5.4) (12.2)
1.8 (15.1) (112.1)
Other recognised gains (losses) for the period - 0.5 (1.3)
Goodwill transferred to the profit and loss account in
respect of businesses sold or to be disposed of - - 14.3
Shares issued 0.1 0.8 0.7
Net increase (decrease) in shareholders'
funds for the period 1.9 (13.8) (98.4)
Total shareholders' funds at the beginning of the period (i) 160.7 259.1 259.1
Total shareholders' funds at the end of the period 162.6 245.3 160.7
(i) Shareholders' funds at the beginning of 2002 were originally #258.4
million before adding prior year adjustment of #0.7 million.
-8-
Independent review report to Delta plc
Introduction
We have been instructed by the company to review the financial information for
the six months ended 28 June 2003 which comprises the group profit and loss
account, the group balance sheet, the group cash flow statement, the statement
of total recognised gains and losses, the movements in shareholders' funds and
related notes 1 to 8. We have read the other information contained in the
interim report and considered whether it contains any apparent misstatements or
material inconsistencies with the financial information.
This report is made solely to the company in accordance with Bulletin 1999/4
issued by the Auditing Practices Board. Our work has been undertaken so that we
might state to the company those matters we are required to state to them in an
independent review report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone other than
the company, for our review work, for this report, or for the conclusions we
have formed.
Directors' responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the directors. The directors
are responsible for preparing the interim report in accordance with the Listing
Rules of the Financial Services Authority which require that the accounting
polices and presentation applied to the interim figures are consistent with
those applied in preparing the preceding annual accounts except where any
changes, and the reasons for them, are disclosed.
Review work performed
We conducted our review in accordance with the guidance contained in Bulletin
1999/4 issued by the Auditing Practices Board for use in the United Kingdom. A
review consists principally of making enquiries of group management and applying
analytical procedures to the financial information and underlying financial data
and, based thereon, assessing whether the accounting policies and presentation
have been consistently applied unless otherwise disclosed. A review excludes
audit procedures such as tests of controls and verification of assets,
liabilities and transactions. It is substantially less in scope than an audit
performed in accordance with United Kingdom auditing standards and therefore
provides a lower level of assurance than an audit. Accordingly, we do not
express an audit opinion on the financial information.
Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 28 June 2003.
Deloitte & Touche LLP
Chartered Accountants
London
3 September 2003
-9-
Principal activities
Half-year to 28 June 2003 Half-year to 29 June 2002
Profit Profit
Turn- before Net Turn- before Net
# million over taxation Assets over taxation assets
By activity:
Specialty chemicals 91.2 11.2 139.0 78.3 10.9 125.2
Industrial supplies 72.0 7.8 53.2 62.8 5.0 38.7
Group costs - (2.4) (5.8) - (3.0) (1.0)
Exceptional operating items (ii) - (1.2) (0.7) - - -
Goodwill (ii) - (0.4) 10.8 - (0.3) 8.7
Continuing operations 163.2 15.0 196.5 141.1 12.6 171.6
Discontinued operations (iii) 16.2 - (0.4) 143.4 2.2 183.4
Disposal of businesses (note 2) - (80.2) - - (12.8) -
Use of provision made in previous year (note 2) - 80.2 - - 6.0 -
Provision for diminution in value of
businesses (note 2) - - (18.7) - (3.7) (2.0)
Interest/net borrowings & money market
fund current investments - (1.8) 24.7 - (4.0) (73.8)
179.4 13.2 202.1 284.5 0.3 279.2
Less: joint ventures and associated companies (i) (17.4) - - (21.6) - -
162.0 13.2 202.1 262.9 0.3 279.2
By origin:
Europe 5.1 (1.9) (0.9) 4.7 (3.2) 3.6
Asia Pacific 92.3 11.3 106.6 75.9 7.0 85.7
North America 7.8 (0.8) 19.0 9.3 (0.7) 22.2
Africa 58.0 8.0 61.7 51.2 9.8 51.4
Exceptional operating items (ii) - (1.2) (0.7) - - -
Goodwill (ii) - (0.4) 10.8 - (0.3) 8.7
Continuing operations 163.2 15.0 196.5 141.1 12.6 171.6
Discontinued operations (iii) 16.2 - (0.4) 143.4 2.2 183.4
Disposal of businesses (note 2) - (80.2) - - (12.8) -
Use of provision made in previous year (note 2) - 80.2 - - 6.0 -
Provision for diminution in value of
businesses (note 2) - - (18.7) - (3.7) (2.0)
Interest/net borrowings & money market
fund current investments - (1.8) 24.7 - (4.0) (73.8)
179.4 13.2 202.1 284.5 0.3 279.2
Less: joint ventures and associated companies (i) (17.4) - - (21.6) - -
162.0 13.2 202.1 262.9 0.3 279.2
-10-
Principal activities (continued)
Half-year to 28 June 2003 Half-year to 29 June 2002
Profit Profit
Turn- before Net Turn- before Net
# million over taxation Assets over taxation Assets
By destination:
Europe 11.7 10.4
Asia Pacific 81.0 63.4
North America 21.5 25.9
Africa 32.2 24.2
Continuing operations 146.4 123.9
Discontinued operations 15.6 139.0
162.0 262.9
(i) Joint ventures and associated companies
By activity:
Specialty chemicals 10.7 (0.1) 14.4 12.1 3.6 16.2
Industrial supplies 6.1 0.6 9.0 5.1 0.8 6.3
Discontinued 0.6 (0.1) - 4.4 (0.1) 1.1
Interest - 0.1 - - 0.5 -
17.4 0.5 23.4 21.6 4.8 23.6
By origin:
Asia Pacific 0.4 0.1 1.6 0.3 0.1 1.3
North America 0.1 - 0.2 - - 0.3
Africa 16.3 0.4 21.6 16.9 4.3 20.9
Discontinued 0.6 (0.1) - 4.4 (0.1) 1.1
Interest - 0.1 - - 0.5 -
17.4 0.5 23.4 21.6 4.8 23.6
Discontinued by activity:
Electrical 0.6 (0.1) - 4.4 - 1.1
Interest - - - - (0.1) -
0.6 (0.1) - 4.4 (0.1) 1.1
Discontinued by origin:
Europe 0.5 (0.1) - 2.6 (0.3) 0.6
Asia Pacific 0.1 - - 1.6 0.2 0.1
North America - - - 0.2 0.1 0.4
Interest - - - - (0.1) -
0.6 (0.1) - 4.4 (0.1) 1.1
-11-
Principal activities (continued)
Exceptional operating items Goodwill
Half-year to Half-year to Half-year to Half-year to
28 June 2003 29 June 2002 28 June 2003 29 June 2002
Oper- Oper- Oper- Intan- Oper- Intan-
ating Pro- ating Pro- ating gilble ating gilble
# million profit visions profit visions profi assets profi assets
(ii) By activity:
Specialty chemicals - - - - (0.2) 3.3 (0.1) 2.5
Industrial supplies - - - - (0.2) 7.5 (0.2) 6.2
Group costs (1.2) (0.7) - - - - - -
Discontinued:
Industrial supplies (0.1) (0.2) (0.1) - - - (0.1) -
Electrical (0.2) - (3.5) (3.2) - - (1.9) 62.3
(1.5) (0.9) (3.6) (3.2) (0.4) 10.8 (2.3) 71.0
By origin:
Europe (1.2) (0.7) - - - - - -
Asia Pacific - - - - (0.2) 2.8 (0.1) 2.0
North America - - - - - 0.6 - 0.6
Africa - - - - (0.2) 7.4 (0.2) 6.1
Discontinued:
Europe (0.2) (0.2) (3.6) (3.2) - - (1.9) 61.3
Asia Pacific (0.1) - - - - - - -
North America - - - - - - (0.1) 1.0
(1.5) (0.9) (3.6) (3.2) (0.4) 10.8 (2.3) 71.0
Half-year to 28 June 2003 Half-year to 29 June 2002
Operating Net Operating Net
# million Turnover profit Assets Turnover profit Assets
(iii) Discontinued activities
By activity:
Industrial supplies 1.5 - (1.7) 32.9 2.0 2.3
Electrical 14.7 (2.6) 1.3 110.5 0.2 181.1
Use of provision made in
previous year - 2.6 - - - -
16.2 - (0.4) 143.4 2.2 183.4
By origin:
Europe 13.5 (2.6) 2.2 109.2 (0.6) 175.1
Asia Pacific 2.5 - (0.1) 18.4 0.8 10.2
North America 0.2 - (2.5) 15.8 2.0 (1.9)
Use of provision made in
previous year - 2.6 - - - -
16.2 - (0.4) 143.4 2.2 183.4
-12-
Notes
1 The results for the half-year to 28 June 2003 have been reviewed (but not
audited) by the Group's auditors and do not constitute accounts within the
meaning of Section 240 of the Companies Act 1985. They have been prepared on
a basis consistent with the accounting policies adopted in the accounts for
the year ended 28 December 2002. The balance sheet at 29 June 2002 has been
restated as a result of adopting FRS19 'Deferred Tax' in the year ended 28
December 2002. The full accounts for the year ended 28 December 2002
received an unqualified report from the auditors and were submitted to the
registrar of companies. The figures for that year included above, are
abridged accounts.
2 Exceptional items:
2003 2002
Half-year to Half-year to Year to
# million 28 June 29 June 28 December
Operating exceptional charge - Rationalisation
and redundancy (i) (1.5) (3.6) (5.8)
Exceptional interest (ii) - - (1.5)
Disposal of Loss on disposal and termination
businesses: of businesses (80.2) (12.8) (21.9)
Use of provision made in
previous year 80.2 6.0 12.3
Provision for diminution in value of businesses to be
disposed of - (3.7) (92.0)
Total non-operating exceptional items (i) and (iii) - (10.5) (101.6)
(i) The tax credit attributable to operating exceptional items is #nil
(2002 half-year #nil; full-year #0.2 million), the tax credit
attributable to non-operating exceptional items is #nil (2002 half-
year #nil; full-year #0.1 million).
(ii) The exceptional interest payable in the 2002 full-year of #1.5
million relates to the early repayment of the US Private Placement.
(iii) Included in the loss on disposal of #(80.2) million is #(2.2) million
(2002 half-year #(12.8)million; full-year #(21.9) million) in respect
of the remaining Plumbing businesses. The remaining # (78.0) million
(2002 half-year and full-year #nil) is in respect of the disposal of
the Electrical division, for which a provision of #(91.5) million for
diminution in value was made in 2002. At the 2002 half-year a
provision of #(3.7) million was made in respect of the Group's
investment in an associate which manufacturers supplies for the
Electrical division and the remainder was made following the
agreement to sell the division to the Eaton Corporation.
3 Following the disposal of a significant part of the total group, via the
Electrical and Plumbing divestments, net interest charges have been
classified between continuing and discontinued operations on the basis of
average capital employed, adjusted for specific business factors.
Comparative amounts have been restated on this basis.
4 The profit and loss charge for taxation is calculated at current rates of
corporation tax and overseas tax on the profits for the period. It includes
deferred tax calculated, at the appropriate rates, on the full provision
basis. Taxation has been allocated between continuing and discontinued on
the basis of the legal entities or businesses to which the relevant tax
charge relates. Comparative amounts have been restated on this basis. The
taxation charge includes overseas taxation of #5.5 million (2002 half-year
#5.2 million; full-year #10.5 million) and #0.2 million (2002 half-year #1.5
million; full-year #2.2 million) in respect of the Group's share of taxation
of associates and joint ventures.
5 The profit and loss accounts of overseas companies are translated into
sterling at average exchange rates for the relevant accounting period. Their
balance sheets and the foreign currency assets/liabilities of the UK
companies are translated at the rates ruling on the last day of the
accounting period. The effect of the translation of unhedged net assets on
reserves was #nil (2002 debit #0.5 million).
-13
Notes (continued)
6 Basic earnings per share have been calculated by dividing the profit
attributable to ordinary shareholders by 150.7 million, being the weighted
average number of ordinary shares in issue during the period (2002 half-
year 150.4 million; full-year 150.6 million).
To give a better understanding of the underlying results of the period,
additional earnings per share figures are given on the face of the profit
and loss account, both pre and post discontinued operations, based upon
attributable profit before amortisation of goodwill and exceptional items.
Adjusted earnings per ordinary share (including discontinued operations) is
calculated as follows:
2003 2002
Half-year to 28 Half-year to 29 Year to 28
June June December
Total Total Total
earnings EPS earnings EPS earnings EPS
# million pence # million pence # million pence
Profit (loss) attributable to ordinary 3.9 2.6 (9.8) (6.5) (100.0) (66.4)
shareholders
Amortisation of goodwill 0.4 0.3 2.3 1.5 4.4 2.9
Basic EPS excluding goodwill amortisation 4.3 2.9 (7.5) (5.0) (95.6) (63.5)
Effect of operating exceptional items
before taxation 1.5 0.9 3.6 2.4 7.3 4.8
Effect of non-operating exceptional items
before taxation - - 10.5 7.0 101.6 67.6
Effect of taxation on exceptional items - - - - (0.1) (0.1)
Basic EPS excluding exceptional items
and goodwill amortisation 5.8 3.8 6.6 4.4 13.2 8.8
7 Net cash (outflow) inflow from operating activities:
2003 2002
Half-year to Half-year to Year to
# million 28 June 29 June 28 December
Operating profit 12.0 10.4 24.5
Depreciation and amortisation of goodwill 6.8 13.1 24.5
Working capital movements (24.5) (21.9) (9.0)
Restructuring provisions - - 1.5
Other items (2.5) 2.6 7.7
(8.2) 4.2 49.2
8 Reconciliation of net cash flow to movement in net debt:
(Decrease) increase in cash in the period (3.5) 17.9 10.5
Cash outflow (inflow) from decrease (increase)
in debt and lease financing 93.2 (15.0) 4.1
Cash inflow from decrease in liquid resources (14.1) (15.4) (6.0)
Change in net debt resulting from cash flows 75.6 (12.5) 8.6
Disposals - finance leases 3.3 - -
Translation difference (3.2) (2.3) 1.4
Movement in net debt in the period 75.7 (14.8) 10.0
Net debt at the beginning of the period (46.4) (56.4) (56.4)
Net cash (debt) at the end of the period 29.3 (71.2) (46.4)
Included within liquid resources are money market funds of #0.5 million
(2002 half-year #2.4 million; full-year #0.4 million), bank and other
deposits repayable in excess of 24 hours notice of #nil (2002 half-year
#2.8 million; full-year #12.4 million) and listed current asset investments
of #4.6 million (2002 half-year #2.6 million; full-year #5.4 million).
-14-
Notes (continued)
9 Copies of the interim report for the half-year ended 28 June 2003, from
which these are extracted, are available from Monday 8 September 2003 from
the Secretary, Delta plc, 1 Kingsway, London WC2B 6NP.
Telephone 020-7836-3535.
CONTACTS:
Mark Robson - Finance Director
Telephone - 020 7836 3535
Chris Birks - IRfocus (Analysts & Investors)
Telephone - 020 7861 3895
Andrew Fenwick - Brunswick (Press Enquiries)
Telephone - 020 7404 5959
-15 -
This information is provided by RNS
The company news service from the London Stock Exchange
END
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