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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Driver Group Plc | LSE:DRV | London | Ordinary Share | GB00B0L9C092 | ORD 0.4P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 24.50 | 23.00 | 26.00 | 24.50 | 24.50 | 24.50 | 0.00 | 08:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Heavy Construction, Nec | 42.63M | -336k | -0.0064 | -38.28 | 12.87M |
TIDMDRV
RNS Number : 0917B
Driver Group plc
08 June 2021
8 June 2021
DRIVER GROUP PLC
("Driver" or "the Group")
Interim Report
For the six months ended 31 March 2021
Key Points (for the six months ended 31 March 2021
6 months 6 months Ended Ended 31 March 31 March 2021 2020 GBP000 GBP000 Change Unaudited Unaudited GBP000 ---------- ---------- ------- Revenue 24,957 28,042 (3,085) Gross Profit 6,397 7,175 (778) Gross Profit % 26% 26% - -------------------------------- ---------- ---------- ------- Profit before tax 855 1,252 (397) -------------------------------- ---------- ---------- ------- Add: Share-based payment charge 158 - 158 -------------------------------- ---------- ---------- ------- Underlying* profit before tax 1,013 1,252 (239) -------------------------------- ---------- ---------- ------- Underlying* profit before tax % 4% 4% - Underlying* earnings per share 1.4p 1.8p (0.4p) Net cash** 7,222 3,301 3,921
-- Underlying* profit before tax at GBP1.0m (2020: GBP1.3m) resulting in an underlying* profit before tax margin of 4% (2020: 4%).
-- Profit before tax at GBP0.9m (2020: GBP1.3m). -- Net cash increase year on year of GBP3.9m to GBP7.2m (2020: GBP3.3m). -- Revenue down by 11.0% to GBP25.0m (2020: GBP28.0m) as a result of the impact of COVID-19. -- Gross profit at 26%, a GBP0.8m decrease to GBP6.4m (2020: GBP7.2m).
-- Fee earner headcount decreased by 28 to 301 with an increase in EuAm offset by decreases in both APAC and Middle East.
-- Overall utilisation rates of 72.1% (2020: 73.1%).
-- Europe & Americas (EuAm) reported underlying * profit before tax for the period of GBP2.5m (2020: GBP1.7m) with utilisation rates at 71.6% (2020: 71.6%).
-- Middle East (ME) reported underlying * loss before tax for the period of GBP0.4m (2020: breakeven) with utilisation rates at 75.0% (2020: 72.3%).
-- Asia Pacific (APAC) reported underlying * loss before tax for the period of GBP0.3m (2020: GBP0.6m profit) with utilisation rates at 67.6% (2020: 77.1%).
* Underlying figures are stated before the share-based payment costs (this is not a GAAP measure).
** Net cash consists of cash and cash equivalents and bank loans
*** Utilisation % is calculated by dividing the total hours billed by the total working hours available for chargeable staff
Steve Norris, Chairman of Driver Group, said:
"The Group has continued to perform well despite the ongoing disruption caused by the COVID-19 pandemic. Meaningful progress has been made on implementing the five year strategy, and this has positioned the group well for future growth as restrictions following the pandemic are relaxed and we see the widely anticipated improvement in our key markets."
Results presentation
The leadership team will be hosting a live webcast for analysts and investors at 09.30 GMT on 8 June 2021. Analysts have already been invited to participate in a live Q&A during the presentation, but any eligible person not having received details should contact the Company's PR advisers, Acuitas Communications, at driver@acuitascomms.com or on +44 (0)20 3848 2810.
Enquiries:
Driver Group plc Mark Wheeler (CEO) David Kilgour (CFO) +44 (0) 20 7377 0005 N+1 Singer - Nominated Adviser Sandy Fraser +44 (0)20 7496 3000 Acuitas Communications - Financial +44 (0) 20 3848 2810 PR simon.nayyar@acuitascomms.com Simon Nayyar catriona.foyle@acuitascomms.com C atriona Foyle
INTRODUCTION
During the COVID-19 affected first half of the 2021 financial year the Group has performed in line with the second half of the 2020 financial year. This resilient performance is creditable during the first half of the financial year with underlying* profit before tax (stated before share based payment charges) being slightly below the result for the same period last year, which was largely unaffected by COVID-19. Whilst the performance during the period has been adversely impacted by various lockdowns in key territories and the loss of senior staff and associated team members to a competitor in the APAC region, we have made meaningful progress in implementing the five year strategic plan which was announced in December 2020. We have successfully established and grown a presence in the United States and Spain which has resulted in developing opportunities in these markets and in South America. Additionally, we have achieved the following strategic objectives:
-- Grown the number of testifying Diales experts to 50 -- Focused recruitment to further enhance our technical and geographic service offering -- Implemented a new long term incentive plan to aid the retention of key staff
-- Won a long term contract with a major South Korean contractor based in Seoul which will help to further grow this sector
-- Reduced the Group's cost base by approximately 13% year-on-year by bearing down selectively on operating costs whilst maintaining the Group's fee-earning capacity at maximum utilisation at pre-COVID levels
In addition, it is our intention to establish a forensic accounting service offering under the Diales brand. This new service line represents an excellent and complementary fit alongside our core construction-related quantum, delay and technical expert services. Implementation of these actions is consistent with the Group's stated strategic ambition to generate increased shareholder value through growing the proportion of revenues derived from higher margin expert assignments.
TRADING PERFORMANCE
Group revenue for the six months to 31 March 2021 was GBP25.0m, a decrease of 10.7% on the same period in 2020 (GBP28.0m), however the latter period was mainly unaffected by COVID-19. Overall, the Group reported an underlying* profit before tax of GBP1.0m (2020: GBP1.3m). Revenues in the EuAm region of GBP17.2m increased by 11.8% which was offset by decreases of 28.4% in ME and 55.7% in APAC respectively GBP5.7m and GBP2.1m. The EuAm region delivered operating profits of GBP2.5m (2020: GBP1.7m) whilst the ME region recorded an operating loss of GBP0.4m (2020: breakeven) and APAC region an operating loss of GBP0.3m (2020: operating profit GBP0.6m). The strong performance in EuAm was delivered across the region increasing the operating margin to 14.7% (2020: 11.2%) whilst the poor performances in ME and APAC regions reflect a combination of COVID-19 affected markets and the loss of key staff in Singapore to a competitor. Decisive action has been taken with a view to improving operating performance in both the ME and APAC regions, with both regions under the common leadership of a very experienced operational business leader, who joined the Group from a major competitor in September 2020.
The Group's effective tax rate is 34% (2020: 24%) reflecting a shift in the geographic split of overall Group profits with taxable profits generated in the EuAm region and losses in low tax regime in the ME region. Profit per share was 1.1p (2020: 1.8p).
The Group continues to maintain strict discipline over the management of its net working capital position and the Group's net cash** balance stood at GBP7.2m at 31 March 2021 compared to GBP8.2m at the traditionally seasonally higher financial year end position at 30 September 2020 and GBP3.3m at 31 March 2020.
Net cash inflow from operations was GBP0.3m (2020: GBP0.5m outflow) during the first six months, including a net inflow from a decrease in trade and other receivables of GBP0.1m (2020: GBP2.1m cash outflow) and a net cash outflow from a decrease in trade and other payables of GBP1.5m (2020: GBP0.4m). Tax paid totalled GBP0.2m (2020: GBP0.3m) and the acquisition of fixed assets absorbed GBP0.2m (2020: GBP0.1m). A further cash outflow during the period was the payment of dividends of GBP0.4m (2020: GBP0.7m).
DIVID
The final dividend announced at the time of the results for the year to 30 September 2020 (0.75p per share) in December was paid in March 2021. Reflecting our confidence in the medium term prospects for the Group and the inherently cash generative nature of our business along with the strong balance sheet position the Board recommends the payment of an interim dividend of 0.75p per share for 2021 (2020: nil p per share).
OUTLOOK
Activity levels during April and May were broadly unchanged from those witnessed during the first half and while the pipeline of opportunities continues to build, the COVID impact on pipeline conversion timelines suggests that the prospects of a meaningful uptick during the remainder of the current financial year are now limited. Construction-related claims activity is a lagging indicator of broader trends in infrastructure spend and the Board's belief is that Driver's current activity levels are reflective of the wider market. Looking beyond the current financial year, recognising that Driver typically operates with limited forward revenue visibility, our expectation is that the very significant constraints on routine business development which have existed throughout the last twelve months will start to abate. The building blocks which underpin our five year plan are in place and the Board is confident that the actions already implemented to reposition the business with growth focussed on higher margin expert service lines and, including the
significant reduction in the cost base and hence monthly revenue break-even level noted above, together ensure that the Group is well placed to take advantage of the widely anticipated improvement in our key markets as infrastructure spend recovers and the sector confronts the reality of a COVID-induced backlog of claims and disputes.
I would like to pay particular tribute to our CEO Mark Wheeler and CFO David Kilgour for the way they have managed the business during the COVID-19 affected times and in tandem have still made significant progress in implementing the objectives of the five year strategic plan. I also thank my Board colleagues, Peter Collini, Elizabeth Filkin and John Mullen for their unstinting support and most of all, I thank every one of our staff wherever they are in the world for their continued diligence and loyalty. I am grateful for the confidence our shareholders have consistently demonstrated and I assure them that the Group will continue to do its utmost to repay that confidence.
Steven Norris
Non-Executive Chairman
8 June 2021
* Underlying figures are stated before the share-based payment costs (this is not a GAAP measure).
** Net cash consists of cash and cash equivalents and bank loans
Consolidated Income Statement
Interim report for the six months ended 31 March 2021
6 months 6 months Year ended ended ended 31 March 31 March 30 September 2021 2020 2020 GBP000 GBP000 GBP000 Unaudited Unaudited Audited ------------------------------------------------ ---------- ---------- ------------- REVENUE 24,957 28,042 53,074 ------------------------------------------------ ---------- ---------- ------------- Cost of sales (18,500) (20,748) (39,162) Impairment movement (60) (119) (778) GROSS PROFIT 6,397 7,175 13,134 Administrative expenses (5,576) (5,946) (11,413) Other operating income 67 73 130 ------------------------------------------------ ---------- ---------- ------------- Underlying* operating profit 1,046 1,302 2,618 One off severance costs - - (767) Share-based payment charge and associated costs (158) - - ------------------------------------------------ ---------- ---------- ------------- OPERATING PROFIT 888 1,302 1,851 Finance income - 14 14 Finance costs (33) (64) (128) ------------------------------------------------ ---------- ---------- ------------- PROFIT BEFORE TAXATION 855 1,252 1,737 Tax expense (note 2) (291) (301) (399) ------------------------------------------------ ---------- ---------- ------------- PROFIT FOR THE PERIOD 564 951 1,338 Profit/(loss) attributable to non-controlling interests - 1 (1) Profit attributable to equity shareholders of the parent 564 950 1,339 ------------------------------------------------ ---------- ---------- ------------- 564 951 1,338 ------------------------------------------------ ---------- ---------- ------------- Basic earnings per share attributable to equity shareholders of the parent (pence) 1.1p 1.8p 2.6p Diluted earnings per share attributable to equity shareholders of the parent (pence) 1.0p 1.7p 2.5p ------------------------------------------------ ---------- ---------- -------------
* Underlying figures are stated before the share-based payment costs (this is not a GAAP measure) and one off severance costs.
Consolidated Statement of Comprehensive Income
Interim report for the six months ended 31 March 2021
6 months 6 months Year ended ended ended 31 March 31 March 30 September 2021 2020 2020 GBP000 GBP000 GBP000 Unaudited Unaudited Audited ---------------------------------------------- ---------- ---------- ------------- PROFIT FOR THE PERIOD 564 951 1,338 ---------------------------------------------- ---------- ---------- ------------- Other comprehensive income: Items that could subsequently be reclassified to the Income Statement: Exchange differences on translating foreign operations 37 73 (24) ---------------------------------------------- ---------- ---------- ------------- Other comprehensive income for the year net of tax 37 73 (24) ---------------------------------------------- ---------- ---------- ------------- TOTAL COMPREHENSIVE INCOME FOR THE PERIOD 601 1,024 1,314 ---------------------------------------------- ---------- ---------- ------------- Total comprehensive income attributable to: Owners of the parent 601 1,023 1,315 Non-controlling interest - 1 (1) ---------------------------------------------- ---------- ---------- ------------- 601 1,024 1,314 ---------------------------------------------- ---------- ---------- -------------
Consolidated Statement of Financial Position
Interim report for the six months ended 31 March 2021
31 March 31 March 30 September 2021 2020 2020 GBP000 GBP000 GBP000 Unaudited Unaudited Audited ------------------------------- ---------- ---------- ------------ NON-CURRENT ASSETS ------------------------------- ---------- ---------- ------------ Goodwill 2,969 2,969 2,969 Property, plant and equipment 433 593 501 Right of use asset 2,124 2,226 1,831 Intangible asset 319 57 182 Deferred tax asset 303 268 308 ------------------------------- ---------- ---------- ------------ 6,148 6,113 5,791 ------------------------------- ---------- ---------- ------------ CURRENT ASSETS Trade and other receivables 17,606 21,767 17,819 Derivative financial asset 317 275 171 Cash and cash equivalents 7,472 3,301 11,215 ------------------------------- ---------- ---------- ------------ 25,395 25,343 29,205 ------------------------------- ---------- ---------- ------------ TOTAL ASSETS 31,543 31,456 34,996 ------------------------------- ---------- ---------- ------------ CURRENT LIABILITIES Borrowings (250) - (3,000) Trade and other payables (8,139) (8,788) (9,446) Derivative financial liability (1) (64) (178) Lease creditor (826) (916) (679) Current tax payable (346) (405) (264) ------------------------------- ---------- ---------- ------------ (9,562) (10,173) (13,567) ------------------------------- ---------- ---------- ------------ NON-CURRENT LIABILITIES Lease creditor (1,224) (1,184) (1,040) ------------------------------- ---------- ---------- ------------ (1,224) (1,184) (1,040) ------------------------------- ---------- ---------- ------------ TOTAL LIABILITIES (10,786) (11,357) (14,607) ------------------------------- ---------- ---------- ------------ NET ASSETS 20,757 20,099 20,389 ------------------------------- ---------- ---------- ------------ SHAREHOLDERS' EQUITY Share capital 216 216 216 Share premium 11,496 11,496 11,496 Merger reserve 1,055 1,055 1,055 Currency reserve (412) (352) (449) Capital redemption reserve 18 18 18
Treasury shares (1,025) (1,025) (1,025) Retained earnings 9,406 8,686 9,075 Own shares (3) (3) (3) ------------------------------- ---------- ---------- ------------ TOTAL SHAREHOLDERS' EQUITY 20,751 20,091 20,383 ------------------------------- ---------- ---------- ------------ NON-CONTROLLING INTEREST 6 8 6 ------------------------------- ---------- ---------- ------------ TOTAL EQUITY 20,757 20,099 20,389 ------------------------------- ---------- ---------- ------------
Consolidated Cashflow Statement
Interim report for the six months ended 31 March 2021
6 months 6 months Year ended ended ended 31 March 31 March 30 September 2021 2020 2020 GBP000 GBP000 GBP000 Unaudited Unaudited Audited ---------------------------------------------------- ---------- ---------- ------------- CASH FLOWS FROM OPERATING ACTIVITIES Profit for the year 564 951 1,338 Adjustments for: Depreciation 141 162 321 Amortisation of right to use assets 464 514 1,051 Exchange adjustments 32 (7) 55 Finance income - (14) (14) Finance expense 33 64 128 Tax expense 291 301 399 Equity settled share-based payment charge 158 - - ---------------------------------------------------- ---------- ---------- ------------- OPERATING CASH FLOW BEFORE CHANGES IN WORKING CAPITAL AND PROVISIONS 1,683 1,971 3,278 Decrease/(increase) in trade and other receivables 126 (2,051) 2,056 (Decrease)/increase in trade and other payables (1,486) (394) 240 ---------------------------------------------------- ---------- ---------- ------------- CASH GENERATED/(USED) IN OPERATIONS 323 (474) 5,574 Tax paid (184) (274) (519) ---------------------------------------------------- ---------- ---------- ------------- NET CASH INFLOW/(OUTFLOW) FROM OPERATING ACTIVITIES 139 (748) 5,055 ---------------------------------------------------- ---------- ---------- ------------- CASH FLOWS FROM INVESTING ACTIVITIES Interest received - 14 14 Acquisition of property, plant and equipment (103) (70) (167) Acquisition of intangible asset (136) (57) (182) ---------------------------------------------------- ---------- ---------- ------------- NET CASH OUTflow FROM INVESTING ACTIVITIES (239) (113) (335) ---------------------------------------------------- ---------- ---------- ------------- CASH FLOWS FROM FINANCING ACTIVITIES Interest paid (33) (64) (107) Repayment of borrowings (3,000) (2,125) (3,191) Proceeds of borrowings 250 - 3,000 Repayment of lease liabilities (437) (505) - Dividends paid to the equity shareholders of the parent (391) (652) (653) Purchase of Treasury shares - (25) (25) ---------------------------------------------------- ---------- ---------- ------------- NET CASH OUTFLOW FROM FINANCING ACTIVITIES (3,611) (3,371) (976) ---------------------------------------------------- ---------- ---------- ------------- Net decrease in cash and cash equivalents (3,711) (4,232) 3,744 Effect of foreign exchange on cash and cash equivalents (32) 7 (55) Cash and cash equivalents at start of period 11,215 7,526 7,526 ---------------------------------------------------- ---------- ---------- ------------- CASH AND CASH EQUIVALENTS AT OF PERIOD 7,472 3,301 11,215 ---------------------------------------------------- ---------- ---------- -------------
Consolidated Statement of Changes of Equity
Interim Report for the six months ended 31 March 2021
For the six months ended 31 March 2021 (Unaudited):
Non- Share Share Treasury Merger Other Retained Own controlling Total capital premium shares reserve reserves(2) earnings shares Total(1) interest Equity GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- CLOSING BALANCE AT 30 SEPTEMBER 2020 216 11,496 (1,025) 1,055 (431) 9,075 (3) 20,383 6 20,389 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- Profit for the period - - - - - 564 - 564 - 564 Other comprehensive income for the period - - - - 37 - - 37 - 37 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- Total comprehensive income for the period - - - - 37 564 - 601 - 601 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- Contributions by and distributions to owners Dividend - - - - - (391) - (391) - (391) Share-based payment charge - - - - - 158 - 158 - 158 Purchase of - - - - - - - - - - Treasury shares -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- Total contributions by and distributions to owners - - - - - (233) - (233) - (233) -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- CLOSING BALANCE AT 31 MARCH 2021 216 11,496 (1,025) 1,055 (394) 9,406 (3) 20,751 6 20,757 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- -------
For the six months ended 31 March 2020 (Unaudited):
Non- Share Share Treasury Merger Other Retained Own controlling Total capital premium shares reserve reserves(2) earnings shares Total(1) interest Equity GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- CLOSING BALANCE AT 30 SEPTEMBER 2019 216 11,496 (1,000) 1,055 (407) 8,127 (3) 19,484 7 19,491 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- Profit for the period - - - - - 950 - 950 1 951 Other comprehensive income for the period - - - - 73 - - 73 - 73 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- Total comprehensive income for the period - - - - 73 950 - 1,023 1 1,024 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- Contributions by and distributions to owners Dividend - - - - - (391) - (391) - (391) Issue of new - - - - - - - - - - shares Purchase of Treasury
shares - - (25) - - - - (25) - (25) -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- Total contributions by and distributions to owners - - (25) - - (391) - (416) - (416) -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- CLOSING BALANCE AT 31 MARCH 2020 216 11,496 (1,025) 1,055 (334) 8,686 (3) 20,091 8 20,099 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- -------
Consolidated Statement of Changes of Equity (continued)
Interim Report for the six months ended 31 March 2020
For the year ended 30 September 2020 (Audited):
Non- Share Share Treasury Merger Other Retained Own controlling Total capital premium shares reserve reserves(2) earnings shares Total(1) interest Equity GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- OPENING BALANCE AT 1 OCTOBER 2019 216 11,496 (1,000) 1,055 (407) 8,127 (3) 19,484 7 19,491 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- Profit for the year - - - - - 1,339 - 1,339 (1) 1,338 Other comprehensive income for the year - - - - (24) - - (24) - (24) -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- Total comprehensive income for the year - - - - (24) 1,339 - 1,315 (1) 1,314 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- Dividends - - - - - (391) - (391) - (391) Share-based - - - - - - - - - - payment charge and associated costs Purchase of Treasury shares - - (25) - - - - (25) - (25) Issue of new - - - - - - - - - - shares -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- CLOSING BALANCE AT 30 SEPTEMBER 2020 216 11,496 (1,025) 1,055 (431) 9,075 (3) 20,383 6 20,389 -------------- -------- -------- -------- -------- ----------- -------- ------- -------- ----------- ------- (1) Total equity attributable to the equity holders of the Parent
(2) 'Other reserves' combines the currency reserve and capital redemption reserve. The movement in the current and prior year relates to the translation of foreign currency equity balances and foreign currency non-monetary items.
1 BASIS OF PREPARATION
The consolidated interim financial information has been prepared using accounting policies which are consistent with those applied at the prior year end 30 September 2020 and that are expected to be adopted in the Group's full financial statements for the year ending 30 September 2021.
The financial information in this interim report is in compliance with the recognition and measurement principles of international accounting standards but does not include all disclosures that would be required under IFRSs and are not IAS 34 compliant. The accounting policies have been applied consistently throughout the Group for the purposes of preparation of this financial information. The financial information for the half years ended 31 March 2021 and 31 March 2020 does not constitute statutory accounts within the meaning of Section 434(3) of the Companies Act 2006 and is unaudited but has been reviewed by our auditors.
The comparative financial information for the year ended 30 September 2020 included within this report does not constitute the full statutory accounts for that period. The statutory Annual Report and Financial Statements for 2020 have been filed with the Registrar of Companies. The Independent Auditor's Report on that Annual Report and Financial Statements for 2020 was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.
The Financial Statements have been prepared on a going concern basis. In reaching their assessment, the Directors have considered a period extending at least twelve months from the date of approval of this financial report.
The Directors continue to monitor developments across the markets the Group operate in and the potential impact of COVID-19 in the short and medium term and is in particular focussed on the key risks of: delays by clients in contracting for claims advice; projects being suspended or planned projects not proceeding which could potentially result in a reduction in staff utilisation levels; and the impact of the current situation on the financial stability of clients causing delays to payments.
As Driver's business is geographically well spread across the world the Directors have been managing the impact of COVID-19 since January 2020 when the Singapore and Hong Kong offices started working remotely. As COVID-19 has spread, remote working has been successfully adopted at varying times in the Middle East offices and across Europe including the UK with minimal disruption of service to our clients. Whilst the COVID-19 restrictions have been relaxed across some jurisdictions the ongoing impact continues to be felt. The Directors are continuing to closely monitor the impact on the business to ensure the welfare of the staff and the clients.
The Directors have prepared cash flow forecasts and a reverse stress test covering a period of more than 12 months from the date of releasing these financial statements. This assessment has included consideration of the forecast performance of the business for the foreseeable future, the cash and financing facilities available to the Group and the mitigating actions undertaken to reduce the impact of COVID-19. In preparing these forecasts, the Directors have considered sensitivities incorporating the potential impact of COVID-19 such as a reduction in both revenues and debtor receipts. The forecasts show that the Group could incur a further reduction in revenues of up to approximately 19% compared to existing depressed COVID-19 levels if combined with a minimal change to the cost base and a reduction of cash collections by up to 24% compared to current levels and still have sufficient headroom to operate. In all scenarios, the Group remained in a cash positive position with headroom throughout and as such there were no concerns with the banking covenants associated with the Group's facilities.
At 31 March 2021 the Group had cash reserves of GBP7.45m with an undrawn revolving credit facility of GBP5.0m and an undrawn GBP1.75m Coronavirus Large Business Interruption Loan Scheme Facility (GBP0.25m drawn). In addition to the above, the Group has also agreed a relaxation of its banking covenants until 30 September 2021.
Based on the cash flow forecasts prepared including appropriate stress testing, the Directors are confident that any funding needs required by the business will be sufficiently covered by the existing cash reserves and the undrawn additional credit facility. As such these Financial Statements have been prepared on a going concern basis.
2 TAXATION
The tax charge on the profit for the half-year ended 31 March 2021 is based on the estimated tax rates in the jurisdictions in which the Group operates, for the year ending 30 September 2021.
3 DIVID
In view of the medium term prospects for the Group and the inherently cash generative nature of the business along with the strong balance sheet position, the Board recommends the payment of an interim dividend of 0.75p per share for 2021 (2020: interim dividend nil p per share).
4 SUMMARY SEGMENTAL ANALYSIS
REPORTABLE SEGMENTS
For management purposes, the Group is organised into three operating divisions: Europe & Americas (EuAm), Middle East (ME) and Asia Pacific (APAC). These divisions are the basis on which the Group is structured and managed, based on its geographic structure. The following key service provisions are provided across all three operating divisions: quantity surveying, planning / programming, quantum and planning experts, dispute avoidance / resolution, litigation support, contract administration and commercial advice / management. Segment information about these reportable segments is presented below.
Europe Middle Six months ended 31 March 2021 & Americas East Asia Pacific Eliminations Unallocated Consolidated (Unaudited) GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 ------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Total external revenue 17,179 5,689 2,089 - - 24,957
Total inter-segment revenue - - 18 (18) - - ------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Total revenue 17,179 5,689 2,107 (18) - 24,957 ------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Segmental profit 2,527 (398) (278) - - 1,851 Unallocated corporate expenses - - - - (805) (805) Share-based payment charge - - - - (158) (158) ------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Operating profit/(loss) 2,527 (398) (278) - (963) 888 Finance income - - - - - - Finance expense - - - - (33) (33) ------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Profit/(loss) before taxation 2,527 (398) (278) - (996) 855 Taxation - - - - (291) (291) ------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Profit/(loss) for the period 2,527 (398) (278) - (1,287) 564 ------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Europe Middle Six months ended 31 March 2020 & Americas East Asia Pacific Eliminations Unallocated Consolidated (Unaudited) GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 ---------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Total external revenue 15,371 7,951 4,720 - - 28,042 Total inter-segment revenue 61 256 7 (324) - - ---------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Total revenue 15,432 8,207 4,727 (324) - 28,042 ---------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Segmental profit 1,715 30 633 - - 2,378 Unallocated corporate expenses(1) - - - - (1,076) (1,076) ---------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Operating profit/(loss) 1,715 30 633 - (1,076) 1,302 Finance income - - - - 14 14 Finance expense - - - - (64) (64) ---------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Profit/(loss) before taxation 1,715 30 633 - (1,126) 1,252 Taxation - - - - (301) (301) ---------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Profit/(loss) for the period 1,715 30 633 - (1,427) 951 ---------------------------------- ----------- ------- ------------ ------------ ----------- ------------ Europe & Middle Year ended 30 September Americas East Asia Pacific Eliminations Unallocated Consolidated 2020 (AUDITED) GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 ---------------------------------- --------- ------- ------------ ------------ ----------- ------------ Total external revenue 31,033 14,373 7,668 - - 53,074 Total inter-segment revenue 53 576 24 (653) - - ---------------------------------- --------- ------- ------------ ------------ ----------- ------------ Total revenue 31,086 14,949 7,692 (653) - 53,074 ---------------------------------- --------- ------- ------------ ------------ ----------- ------------ Segmental profit 3,988 111 511 - - 4,610 Unallocated corporate expenses(1) - - - - (1,992) (1,992) One off severance costs - - - - (767) (767) ---------------------------------- --------- ------- ------------ ------------ ----------- ------------ Operating profit 3,988 111 511 - (2,759) 1,851 Finance income - - - - 14 14 Finance expense - - - - (128) (128) ---------------------------------- --------- ------- ------------ ------------ ----------- ------------ Profit before taxation 3,988 111 511 - (2,873) 1,737 Taxation - - - - (399) (399) ---------------------------------- --------- ------- ------------ ------------ ----------- ------------ Profit for the period 3,988 111 511 - (3,272) (1,338) ---------------------------------- --------- ------- ------------ ------------ ----------- ------------ OTHER INFORMATION Non current assets 3,192 270 87 - 2,242 5,791 Reportable segment assets 16,061 8,796 2,117 - 8,022 34,996 Capital additions(2) 82 37 18 - 212 349 Depreciation and amortisation 543 327 247 - 255 1,372
(1) Unallocated costs represent Directors' remuneration, administration staff, corporate head office costs and expenses associated with AIM.
(2) Capital additions comprise of additions to property, plant and equipment and intangible assets.
5 EARNINGS PER SHARE 6 months 6 months Year ended ended ended 31 March 31 March 30 September 2021 2020 2020 GBP000 GBP000 GBP000 Unaudited Unaudited Audited --------------------------------------------- ----------- ----------- ------------- Profit for the financial period attributable to equity shareholders 564 950 1,339 Compensation for loss of office - - 767 Share-based payments cost and associated costs 158 - - --------------------------------------------- ----------- ----------- ------------- Underlying* profit for the financial period 722 950 2,106 --------------------------------------------- ----------- ----------- ------------- Weighted average number of shares: --------------------------------------------- ----------- ----------- ------------- - Ordinary shares in issue 53,962,868 53,962,868 53,962,868 - Shares held by EBT (3,677) (3,677) (3,677) - Treasury shares (1,787,811) (1,786,062) (1,786,937) --------------------------------------------- ----------- ----------- ------------- Basic weighted average number of shares 52,171,380 52,173,129 52,172,254 Effect of employee share options 1,939,155 2,759,618 2,558,796 --------------------------------------------- ----------- ----------- ------------- Diluted weighted average number of shares 54,110,535 54,932,747 54,731,050 --------------------------------------------- ----------- ----------- ------------- Basic earnings per share attributable to equity shareholders of the Parent (pence) 1.1p 1.8p 2.6p --------------------------------------------- ----------- ----------- ------------- Diluted earnings per share attributable to equity shareholders of the Parent (pence) 1.0p 1.7p 2.5p --------------------------------------------- ----------- ----------- ------------- Underlying* basic earnings per share 1.4p 1.8p 4.0p --------------------------------------------- ----------- ----------- ------------- 6 POST BALANCE SHEET EVENT
There have been no significant events requiring disclosure since 31 March 2021.
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END
IR UBUKRAVUNRAR
(END) Dow Jones Newswires
June 08, 2021 02:00 ET (06:00 GMT)
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