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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
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Densitron Tech. | LSE:DSN | London | Ordinary Share | GB0002637394 | 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% | 10.75 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
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0 | 0 | N/A | 0 |
TIDMDSN
RNS Number : 7092C
Densitron Technologies PLC
04 May 2012
DENSITRON TECHNOLOGIES PLC
PRELIMINARY UNAUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2011
Densitron Technologies plc ("Densitron" or the "Company" or the "Group"), the designer, developer and distributor of electronic displays is pleased to announce its preliminary unaudited results for the year ended 31 December 2011. A further year of substantial growth has enabled the Group to move forward with its growth plans. 0 Revenue increased by 11% to GBP23.1 million (2010: GBP20.8 million). 0 Profit from continuing operations (excluding loss on disposal of available-for-sale asset in 2010) increased to GBP1.1 million (2010: GBP0.7 million). 0 2011 profit from operations reduced by GBP0.1 million due to exceptional legal costs. Excluding these costs the profit from operations would be GBP1.2 million (2010: GBP0.7 million). 0 Capital reduction and special dividend totaling 5p per share paid to Shareholders. 0 Dividends for the year totaling 0.6p per share (2010: 0.3p per share) an increase of 100%. 0 Earnings per share (excluding disposal of available-for-sale asset in 2010) increased to 1.18p (2010: 0.72p). 0 Increase in gross margin from 28.1% to 29.6% reflecting an increase in the Group's range of quality products. 0 Growth of the new branch office in Italy. 0 Introduction of internally developed products providing intellectual property for the Group. 0 Promotion of new products and growth in the range of existing products. 2011 2010 GBP million GBP million Revenue 23.1 20.8 Profit from operations * 1.1 0.7 Basic earnings per share * 1.18p 0.72p Orders booked 21.2 21.8 Order Book 8.9 10.1 * Excludes loss on the sale of available-for-sale asset in 2010
Jan G Holmstrom, Chairman of Densitron, commented:
"I am delighted with the progress that the business has continued to make during the year. The foundations that were laid several years ago have enabled the business to develop and grow despite difficult economic conditions."
Enquiries:
Densitron Westhouse Securities Grahame Falconer / Tim Pearson Tom Price / Martin Davison Tel: 0207 648 4200 Tel: 020 7601 6100
Chairman's Statement
Introduction
I am pleased to report on the results for the year ended 31 December 2011 which show a continuation of the positive progress made by the Group over the last few years. Despite the year being shrouded by continual negative economic news the Group has managed to grow its business further and increase the return generated by its business units.
Densitron Displays
The challenge for the Displays business in the year was to continue the progress that had been made during the previous year when a solid foundation had been laid. The business largely rose to the challenge by increasing both revenues and operating profit significantly during the year.
Inevitably there were obstacles that needed to be negotiated and difficulties that needed to be managed during the year, none more so than the Tsunami that hit Japan in March 2011. I am pleased to be able to report that our office in Japan along with our customers and suppliers were largely unaffected by the Tsunami apart from a shortage of power. It did, however, create a temporary delay in the delivery of certain component parts that are supplied by Japanese manufacturers to display manufacturers in China and Taiwan which resulted in manufacturing lead times being extended. That has now returned to normal.
The challenge for the coming year will be to ensure that those parts of the business that performed well during 2011 and met or exceeded our expectations continue to progress during 2012. Those parts of the business that did not perform to expectations during 2011 have identified and addressed the issues that that caused them not to meet expectations and remedial measures have been adopted.
Land at Blackheath
Blackheath is the 1.25 acre piece of land that the Group owns in Blackheath, South East London.
I reported in my statement last year that our planning application for the land had been rejected by the Local Council. Following the rejection we reviewed the options we had with the land and consulted leading Counsel. We consequently took the decision not to appeal against the ruling of the local Council and to pursue alternative options. We are now working on the reclassification of the site through the Local Development Framework and exploring existing use rights on the site. We will keep shareholders informed when there is further information.
In 2010, we engaged a firm of surveyors to carry out a professional valuation of the land and they confirmed a valuation of GBP500,000 which was recognised in the 2010 accounts. We have not undertaken a formal revaluation of the land in 2011 but the Board considers the value to be at least at this level.
Shareholders
The directors remain committed to delivering a return to the Company's Shareholders by way of both capital growth and distribution.
Capital Growth - In order to grow the value of the Company it is vital that investors are informed about the Company's businesses. To that end, the Company's Nomad has provided research on the Group during the year and the Executive Directors have held numerous meetings with current and potential investors explaining the results of the Group and its future strategy. The share price at the beginning of 2011 was 14.75p and during the year the Company returned cash to its Shareholders by way of capital reduction and dividends totalling 5.4p per share. At the close of the year the share price was 11.00p. Taking into account the return of cash and dividends, the overall return from a holding in the shares during the year has been 1.65p per share or 11.19%.
Capital reduction - During the year the Company returned 4p per share to its Shareholders by way of a capital reduction and a further 1p per share by way of dividend. This followed the sale of the Group's investment in Evervision Electronics Co. Ltd during 2010. The Board considered that this was the most appropriate use of the disposal proceeds as they were not required within the business to fund the Group's primary strategy of organic growth.
Dividends - The Board is committed to providing Shareholders with dividends but will do so whilst being mindful of the requirements within the Group for funds to continue to grow. An interim dividend of 0.2p per share was paid to Shareholders in September. I am pleased to propose a final dividend for the year of 0.4p per share (2010: 0.2p per share) resulting in a total dividend payment for the year of 0.6p per share (2010: 0.3p per share) representing a return of in excess of 50% of profit for the year and an increase of 100% over 2010.
Claim against the Company
Shareholders were advised in February 2012 that the Group had received a writ in respect of unpaid rents on a property occupied by a former group company, Densitron Ferrograph Limited, whose shares were disposed of in 2006. The Board confirmed in the announcement that it intends to defend the Group's position vigorously in this matter.
Outlook and strategy
The Board of directors review the medium and long term strategy of the business on a regular basis and has concluded that the main driver of the business will remain organic growth. However, in the near term, opportunities to grow the business will diminish unless action is taken to develop it further. To this end, the following four specific business objectives have been identified and have been incorporated into the current business plan:
-- Increase in market share from the existing business; -- Geographical expansion of the business; -- Introduction of new products to the current product offerings; and
-- Creation of more value by development of the Group's own products and intellectual property.
The first three objectives reflect how the Group has been growing the business over the last few years. They are still valid strategies and will continue to be followed. The main change in the strategy is the intention to develop more intellectual property within the Group which will enable the Group to differentiate itself from a number of its competitors throughout the world by having its own unique range of products. It will also result in the Group being able to derive better returns on its revenues and will enable it to retain customers as the products that they are buying increasingly become unique to Densitron. The Group currently has several exciting development projects in the pipeline and the product offerings that are being developed will be available later this year.
I am pleased to be able to report that the level of orders booked in the first quarter of 2012 has been in excess of 28% higher than for the same period in 2011. This clearly demonstrates the continuing strength of demand for the types of products that the Group sells.
I would like to thank the directors and staff throughout the Group for their continued dedication during the year. They have ensured that the progress that was made during 2010 has been continued in 2011 and have assisted in significantly strengthening the business with new products and also an expanded market penetration.
Finally, I would like to thank the Company's shareholders for your continuing support.
Jan G Holmstrom
Chairman
Densitron Technologies plc Consolidated income statement For the year ended 31 December 2011 2011 2010 GBP000 GBP000 Continuing operations Revenue 23,130 20,770 Cost of sales (16,274) (14,928) --------- --------- Gross profit 6,856 5,842 Other operating income 78 174 Distribution costs (72) (62) Administrative expenses (5,769) (5,276) Loss on disposal of available-for-sale asset - (1,174) --------- --------- Profit/(loss) from operations 1,093 (496) Financial income 1 6 Financial expenses (33) (79) --------- --------- Profit/(loss) before tax 1,061 (569) Income tax expenses (245) (109) --------- --------- Profit/(loss) for the year 816 (678) --------- --------- Attributable to: Equity holders of the parent 818 (674) Non-controlling interests (2) (4) --------- --------- 816 (678) --------- --------- Basic and diluted earnings /(loss) per share 1.18p (0.97)p --------- --------- Basic and diluted earnings per share on continuing operations (excluding loss on disposal of available for sale asset) 1.18p 0.72p --------- --------- Densitron Technologies plc Consolidated statement of comprehensive income For the year ended 31 December 2011 2011 2010 GBP000 GBP000 Profit/(loss) for the year 816 (678) ------- ------- Other comprehensive income Exchange gains on translation of foreign operations 50 137 Total other comprehensive income 50 137 ------- ------- Total comprehensive profit/(loss) for the year 866 (541) ------- ------- Total comprehensive profit/(loss) attributable to: Owners of the parent 870 (535) Non-controlling interests (4) (6) ------- ------- 866 (541) ------- ------- Densitron Technologies plc Consolidated Statement of Financial Position At 31 December 2011 2011 2010 GBP000 GBP000 Non current assets Property, plant and equipment 806 757 Goodwill 143 143 Other intangible assets 174 87 Deferred tax assets 48 41 -------- -------- 1,171 1,028 -------- -------- Current assets Inventories 1,311 1,348 Trade and other receivables 4,673 4,916 Financial assets 74 165 Income tax recoverable 130 123 Cash and cash equivalents 1,809 6,002 -------- -------- 7,997 12,554 -------- -------- Total assets 9,168 13,582 -------- -------- Current liabilities Short term borrowings and overdrafts 1,694 2,246 Trade and other payables 2,503 3,499 Current tax payable 232 179 Provisions 134 34 -------- -------- 4,563 5,958 -------- -------- Non current liabilities Borrowings 25 24 Provisions 117 117 Deferred tax liabilities 44 141 -------- -------- 186 282 -------- -------- Total liabilities 4,749 6,240 -------- -------- 4,419 7,342 -------- -------- Equity Share Capital 697 3,483 Retained earnings 2,907 3,082 Special reserve 107 117 Revaluation reserve 450 450 Translation reserve 223 171 -------- -------- Equity attributable to shareholders of Densitron 4,384 7,303 Non-controlling interests 35 39 Total equity 4,419 7,342 -------- -------- Densitron Technologies plc Consolidated Cash Flow Statement For the year ended 31 December 2011 2011 2010 GBP000 GBP000 Cash flows from operating activities Profit/(loss) before taxation 1,061 (569) Adjustments for: Depreciation 61 48 Loss on the sale of available-for-sale asset - 1,174 Net finance expense 32 85 1,154 738 Change in financial assets (74) (165) Change in inventories 23 (665) Change in trade and other receivables 243 (1,220) Change in trade and other payables (929) 1,191 Change in provisions 100 (60) -------- -------- 517 (181) Income tax paid (299) 146 -------- -------- Net cash from operating activities 218 (35) -------- -------- Cash flows from investing activities Interest received 1 3 Proceeds from capital reduction of available for sale investment - 483 Proceeds from disposal of available-for-sale asset - 3,476 Disposal of discontinued operation 165 393 Payment for intangible asset (87) (87) Acquisition of property, plant and equipment (111) (116) -------- -------- Net cash (used in)/generated from investing activities (32) 4,152 -------- -------- Cash flows from financing activities Inception of new loans 83 - Repayment of borrowings (24) (287) Interest paid (33) (92) Change in invoice discounting creditor (675) 450 Change in letters of credit (128) 675 Dividend paid to the owners of the Company (968) (69) Repayment of capital to the owners (2,821) - of the Company -------- -------- Net cash (used in)/generated from financing activities (4,566) 677 -------- -------- Net (decrease)/increase in cash and cash equivalents (4,380) 4,794 Cash and cash equivalents at 1(st) January 6,002 1,107 Effect of exchange rate fluctuations on cash held (6) 101 -------- -------- Cash and cash equivalents at 31(st) December 1,616 6,002 -------- -------- Densitron Technologies plc Statement of Changes in Shareholder's Equity For the year ended 31 December 2011 Share Translation Special Available Revaluation Retained Total Non-controlling Total Capital reserve reserve for reserve earnings attributable interest Equity sale to equity reserve holders of parent GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 Balance at 1(st) January 2010 3,483 34 188 54 - 3,752 7,511 45 7,556 Loss for the year - - - - - (672) (672) (4) (676) Other total comprehensive income - 137 - - - - 137 (2) 135 Revaluation of land - - - - 450 - 450 - 450 Payment of dividends - - - - - (69) (69) - (69) Disposal of available for sale investment - - - (54) - - (54) - (54) Transfer from special reserve - - (71) - - 71 - - - -------- ------------ -------- ---------- ------------ --------- ------------- ---------------- --------- Balance at 31(st) December 2010 3,483 171 117 - 450 3,082 7,303 39 7,342 -------- ------------ -------- ---------- ------------ --------- ------------- ---------------- --------- Balance at 1(st) January 2011 3,483 171 117 - 450 3,082 7,303 39 7,342 Profit for the year - - - - - 818 818 (2) 816 Other total comprehensive income - 52 - - - - 52 (2) 50 Payment of dividends - - - - - (968) (968) - (968) Capital reduction (2,786) - - - - 2,806 20 - 20 Return of capital to shareholders - - - - - (2,786) (2,786) - (2,786) Costs associated with capital reduction - - - - - (55) (55) - (55) Transfer from special reserve - - (10) - - 10 - - - -------- ------------ -------- ---------- ------------ --------- ------------- ---------------- --------- Balance at 31(st) December 2011 697 223 107 - 450 2,907 4,384 35 4,419 -------- ------------ -------- ---------- ------------ --------- ------------- ---------------- --------- Densitron Technologies plc Notes to the Consolidated Financial Statements For the year ended 31 December 2011 1. Basis of preparation The financial statements have been prepared in accordance with International Financial Reporting Standards, International Accounting Standards and Interpretations (collectively IFRSs) issued by the International Accounting Standards Board (IASB) as adopted by the European Union (Adopted IFRSs) and are in accordance with IFRS as issued by the IASB. The accounting policies applied are consistent with those set out in the financial statements of Densitron Technologies plc for the year ended 31 December 2010. The financial information in the announcement is unaudited and does not constitute the company's statutory accounts for the years ended 31(st) December 2011 or 2010. The financial information for the year ended 31 December 2010 is derived from the statutory accounts for that year, which were prepared under IFRSs as adopted by the EU, which have been delivered to the Registrar of Companies. The auditors reported on those accounts; their report was unqualified, did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their reports and did not contain statements under the Companies Act 2006. The statutory accounts for the year ended 31 December 2011, prepared in accordance with IFRSs as adopted by the EU, will be finalised on the basis of the financial information presented by the directors in this preliminary announcement and will be delivered to the Registrar of Companies following the company's annual general meeting. 2. Other operating income 2011 2010 GBP000 GBP000 Royalties receivable 74 165 Other 4 9 ---------- ---------- 78 174 ---------- ---------- 3. Financial income and expense 2011 2010 GBP000 GBP000 Financial income Bank deposit interest 1 - Interest on deferred consideration - 6 ---------- ---------- 1 6 ---------- ---------- Financial expenses Bank borrowings 18 65 Invoice discounting charge 15 14 33 79 ---------- ---------- 4. Loss on disposal of available-for-sale asset 2011 2010 GBP000 GBP000 Proceeds received from the disposal - 3,476 Carrying value of the investment - (4,617) Balance on available-for sale reserve - 54 Costs associated with the disposal - (87) ---------- ---------- Loss on disposal - (1,174) ---------- ---------- On 30 September 2010 the Group disposed of its investment in a Taiwanese manufacturing company, Evervision Electronics Co. Ltd (Evervision). The Group owned 24.48% of the ordinary share capital of Evervision but, in the director's opinion, was not able to exert significant influence and consequently had treated the investment as available-for-sale. During 2009 the Group received approximately GBP1.2m in respect of a capital reduction by Evervision and in 2010 a further GBP0.5m was received. The directors believed that it was unlikely that further income would be received in the near future so took the opportunity to realise, what they considered to be, a reasonable offer on the investment, despite the fact that this led to a loss on disposal being realised in the 2010 results. 5. Business and geographical segments The chief operating decision maker in the organization is made up of an Executive Committee comprising the Executive Directors and Chairman, and they have determined the operating segments detailed within this report, and on which the business is managed. The Group is managed by the geographical location of its subsidiaries and resources are allocated as required on this basis: 0 Europe - The European market, being so diverse, is serviced by subsidiaries based in four locations: 0 UK - the UK is responsible for business conducted in the UK, management of the Group's distribution network and sales into other locations where the Group does not have a physical presence. The UK business contributed 26% (2010: 26%) to Group revenues. 0 France - the subsidiary in France is responsible for business conducted in France and with French customers whose manufacturing operations may be located elsewhere in the world. The French business contributed 15% (2010: 11%) to Group revenues. 0 Finland - Densitron Nordic is the Group's subsidiary located in Finland and servicing business locally along with Sweden and customers located in the Baltic region. The Finnish business contributed 2% (2010: 3%) to Group revenues. 0 Germany - Densitron Deutschland is the Group's subsidiary based in Germany. It is responsible for business conducted in Germany, Switzerland and Austria and through the Group's distributor based in Germany. The German business contributed 10% (2010: 14%) to Group revenues. In total the European region represented the largest part of the business contributing 53% (2010: 54%) to Group revenues. 0 US - the US segment is responsible for business conducted in the US, Canada and Central and South America. It represents 34% (2010: 33%) of the Group total revenues. 0 Asia - The Asian segment is made up of subsidiaries located in Japan and Taiwan. 0 Japan - Densitron Japan is responsible for sales into Japan. It contributed 11% (2010: 9%) to Group revenues. 0 Taiwan - Densitron Asia is the Group's subsidiary located in Taiwan. It is primarily a facilitating function for the rest of the Group managing suppliers located in Taiwan and China. It contributed 2% (2010: 4%) to Group revenues. Inter-segment transfer pricing is based on the level of work carried out and the risk encountered by each party in order to make a third party sale. UK France Finland Germany US Japan Taiwan Total GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 2011 Revenue Total 7,794 3,516 472 2,328 7,997 2,434 7,045 31,586 Intercompany (1,703) (50) (21) - (158) - (6,524) (8,456) -------- ------- -------- -------- ------- ------- -------- -------- Revenue from external customers 6,091 3,466 451 2,328 7,839 2,434 521 23,130 -------- ------- -------- -------- ------- ------- -------- -------- Profit/(loss) before tax 338 81 (14) 55 779 306 71 1,616 -------- ------- -------- -------- ------- ------- -------- -------- Balance Sheet Assets 1,899 1,137 209 734 2,255 1,438 565 8,237 Liabilities (1,777) (268) (44) (101) (910) (263) (766) (4,129) -------- ------- -------- -------- ------- ------- -------- -------- Net assets 122 869 165 633 1,345 1,175 (201) 4,108 -------- ------- -------- -------- ------- ------- -------- -------- Other Interest payable 39 8 - - 3 1 - 51 Capital expenditure - Property, plant and equipment - 7 - - 89 15 - 111 - Depreciation 1 3 1 1 51 - - 57 -------- ------- -------- -------- ------- ------- -------- -------- UK France Finland Germany US Japan Taiwan Total GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 2010 Revenue Total 7,734 2,421 635 2,928 6,869 1,882 6,489 28,958 Intercompany (2,453) (66) - - (46) (22) (5,601) (8,188) -------- ------- -------- -------- ------- ------- -------- -------- Revenue from external customers 5,281 2,355 635 2,928 6,823 1,860 888 20,770 -------- ------- -------- -------- ------- ------- -------- -------- Profit/(loss) before tax 117 (16) (21) (49) 575 112 89 807 -------- ------- -------- -------- ------- ------- -------- -------- Balance Sheet Assets 3,191 938 244 816 1,970 1,092 1,381 9,632 Liabilities (2,984) (264) (44) (107) (763) (115) (1,519) (5,796) -------- ------- -------- -------- ------- ------- -------- -------- Net assets 207 674 200 709 1,207 977 (138) 3,836 -------- ------- -------- -------- ------- ------- -------- -------- Other Interest payable 42 3 - - 8 1 - 54 Capital expenditure - Property, plant and equipment 4 2 - 1 100 - - 107 - Depreciation 1 2 2 1 37 - - 43 -------- ------- -------- -------- ------- ------- -------- -------- Reconciliation of reportable segments, profit and loss, assets and liabilities to the Group's corresponding amounts: 2011 2010 GBP000 GBP000 Revenue Total revenue for reported segments 31,586 28,958 Elimination of inter-segmental revenues (8,456) (8,188) -------- ------------- Group's revenue per consolidated statement of comprehensive income 23,130 20,770 -------- ------------- 2011 2010 GBP000 GBP000 Profit/(loss) after income tax expense Total profit for reporting segments 1,616 807 Costs associated with head office (555) (202) Loss on disposal of available for sale investment - (1,174) Income tax expenses (245) (109) -------- ------------- Profit/(loss) after income tax expense 816 (678) -------- ------------- 2011 2010 GBP000 GBP000 Assets Total assets for reportable segments 8,237 9,632 Assets attributable to Head Office 432 3,451 Land at Blackheath 499 499 Group assets 9,168 13,582 -------- ------------- Liabilities Total liabilities for reportable segments 4,129 5,796 Liabilities attributable to Head Office 620 444 -------- ------------- Group liabilities 4,749 6,240 -------- -------------
The analysis of the Group's segmental information by geographical location is:
External revenue Non current Capital expenditure by location assets by location by location of customers of asset of assets 2011 2010 2011 2010 2011 2010 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 Total operations UK 2,349 2,735 617 612 14 100 France 3,466 2,355 18 16 7 2 Finland 451 635 10 11 - - Germany 2,328 2,928 100 101 - 1 Portugal 703 454 - - - - Italy 557 122 - - - - Other European 740 284 - - - - USA 6,392 7,438 381 260 162 100 Canada 785 - - - - - Other Americas 22 - - - - - Japan 1,909 1,860 17 28 15 - Taiwan 531 890 28 - Malaysia 523 158 - - - - China 1,405 623 - - - - Other Asia 512 - - - - - Tunisia 326 186 - - - - Other Rest of the world 131 102 - - - - --------- -------- ---------- ---------- ---------- ---------- 23,130 20,770 1,171 1,028 198 203 --------- -------- ---------- ---------- ---------- ---------- 6. Tax expense 2011 2010 GBP000 GBP000 Current tax expense UK corporation tax and income tax of overseas operations on profits for the year 408 34 Adjustments for over provision in prior periods (59) (72) ------- ------- 349 (38) Deferred tax expense Origination and reversal of temporary differences (104) 147 ------- ------- Total tax charge 245 109 ------- ------- The reasons for the difference between the actual tax charge for the year and the standard rate of corporation tax in the UK applied to profits for the year are as follows: 2011 2010 GBP000 GBP000 Profit/(loss) before tax 1,061 (569) ------- ------- Expected tax charge based on the standard rate of corporation tax in the UK of 26% (2010: 28%) 276 (159) Losses carried forward 4 91 Disallowed expenses 37 442 Non taxable income - (171) Movement in unprovided deferred tax assets - 2 Utilisation of tax losses brought forward (85) (36) Adjustments for overseas rate 72 12 Adjustments to prior years tax charge (59) (72) 245 109 ------- ------- 7. Earnings per share The earnings and weighted average number of ordinary shares used in the calculation of earnings per share are as follows. 2011 2010 GBP000 GBP000 Profit/(loss) attributable to ordinary shareholders 818 (674) Exceptional loss - 1,174 ----------- ----------- Adjusted profit attributable to ordinary shareholders 818 500 ----------- ----------- 2011 2010 Number Number Weighted average number of ordinary shares Issued ordinary shares at 1(st) January 69,669,106 69,669,106 Effect of purchase of Treasury shares on 23 October 2008 (500,000) (500,000) ----------- ----------- Weighted average number of ordinary shares at 31 December 69,169,106 69,169,106 ----------- ----------- 8. Contingent liabilities The Group is a defendant in a claim involving a property in which it is alleged that the Group is the legal tenant. The management of the Group has taken legal advice and based on this advice is vigorously defending its position. While the directors are confident of the Group's position, should the matter go to court the outcome is uncertain and the Group may be required to make a settlement. The claim against the Group relates to a building occupied by Densitron Ferrograph Limited, a former subsidiary of the Group, that was disposed of in 2006. The claim against the Group is approximately GBP300,000 in unpaid back rent. If the action were to succeed there would also be a liability for unpaid past business rates of approximately GBP70,000. The lease of the premises runs until 2023 and contains provisions for rent reviews in 2013 and 2018 and an outstanding rent review in 2008. The annual rent on the premises is currently GBP167,000 and the annual business rates on the premises are currently GBP60,000. The premises are at present unoccupied.
This information is provided by RNS
The company news service from the London Stock Exchange
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