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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Filta Group Holdings Plc | LSE:FLTA | London | Ordinary Share | GB00BDB7J920 | ORD 10P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 170.00 | 165.00 | 175.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMFLTA
RNS Number : 9611Y
Filta Group Holdings PLC
15 September 2020
15 September 2020
Filta Group Holdings plc
("Filta" or the "Company" or the "Group")
Interim Results for the 6 months ended 30 June 2020
Filta Group Holdings plc (AIM: FLTA), a market-leading commercial kitchen services provider, is pleased to announce its unaudited Interim Results for the 6 months ended 30 June 2020.
Financial Summary
-- Revenues of GBP8.3m (2019: GBP12.2m) substantially impacted by COVID-19 lockdowns and social distancing restrictions
-- Gross profit of GBP3.4m (2019: GBP5.0m) at a gross margin of 41% (2019: 41%) -- Overhead costs in Q2 reduced by 23% in response to impact of COVID-19
-- Adjusted EBITDA of GBP0.2m (2019: GBP1.7m) which includes GBP0.3m COVID-19 related provision
-- Cash inflow from operations of GBP0.5m (2019: outflow GBP0.2m) -- Cash balance of GBP3.2m versus GBP2.9m at 31 December, up 11% on strong cash management -- Net debt (including IFRS 16), declined 9% to GBP1.9m (2019: GBP2.1m) -- Basic loss per share of 3.11p (2019: EPS 1.24p) -- Dividend suspended until visibility of the pace and scale of market recovery has improved
Operational Highlights
-- Strong Q1, followed by reduction in trading due to COVID-19 lockdown and then good month on month growth in May, June, and July
-- 6 new franchise sales in the period
-- Following the outbreak of COVID-19 in March 2020, the Group has been focused on supporting our franchisees and customers by reducing franchise fees and working with customers to prepare for re-openings in Q3
-- Cost reductions achieved through the lockdown period by making use of government schemes, wage cuts and reduced discretionary spending
-- FiltaShield launched in May and recently secured exclusive licensing agreement with NHS Trust owned support services group, NTH Solutions
-- Encouraging progress in North America and Europe as continued interest from potential franchisees has resulted in four new H2 franchise sales and a healthy pipeline
*Adjusted EBITDA represents earnings before interest, taxes, depreciation, amortisation, acquisition related costs and share based payment expense.
This announcement contains inside information.
Jason Sayers, CEO of Filta, commented:
"While the COVID-19 pandemic had a material impact during the first half, our results demonstrate the resilience of our businesses and the fundamental strength of Filta. I am extremely proud of the way that Filta staff have stepped up to challenges we faced in each of our markets, and I thank all our employees and franchisees who have worked tirelessly to support our customers throughout these challenging times.
"We entered the year with good momentum, but with the pandemic causing lower demand for our services and widespread closures across our customer base from mid-March, we quickly adapted, placing emphasis on supporting our employees, franchisees and customers and protecting the long-term health of our business. Despite the disruption, we remained committed to operational excellence whilst developing new and creative ways of working; all of which will ensure that the Company-owned activities in the UK, in particular, remain ideally positioned for future success. The strength of our North American business model has been evidenced by the continued profitable trading that we have enjoyed throughout the COVID-19 affected period.
"With customer demand now coming back, we can focus on leveraging our solid capabilities to drive revenues back up. We are well-prepared for the resumption of trading by our ongoing end customers and believe that there will be growth opportunities as businesses have to become more innovative and efficient.
"Moreover, with the appointment of a new and industry experienced managing director in the UK to drive the business forward, we are confident that we are well placed to achieve strong revenue growth.""
For further information please contact:
Filta Group Holdings plc Tel: +1 407 996 5550
Jason Sayers, Chief Executive Officer
Brian Hogan, Finance Director
Cenkos Securities (Nomad and Broker) Tel: +44 (0)20 7397 8900
Stephen Keys
Harry Hargreaves
Yellow Jersey PR Tel: +44(0)7747 788 221
Charles Goodwin
Joe Burgess
Henry Wilkinson
Chief Executive's and Chairman's Statement
Overview
The first 6 months of the year comprised two periods of greatly contrasting fortunes and performance. In the first 3 months we saw the rationalisation to the UK business, that we had largely completed by the end of last year, deliver significantly improved margins and profitability. In the subsequent 3 months, the effect of COVID-19 reduced our revenue by 64% and gross profit by 48%.
The resulting revenue for the 6 months was GBP8.3 million (2019: GBP12.2 million) and a gross profit of GBP3.4 million (2019: GBP5.0m), giving an adjusted EBITDA of GBP0.2m (2019: GBP1.7m). The reported loss before tax of GBP0.8m (2019: profit GBP0.5m) is after incurring GBP0.9m of non-cash charges (2019: GBP1.0m).
We enjoyed strong operating performances across all our business platforms during the period prior to COVID-19, with revenues from Fryer Management continuing to grow and with gross margins from Site Services approaching the levels achieved before the acquisition of Watbio. There was also a healthy pipeline of new franchisees and a growing amount of recurring income.
Following the implementation of the social distancing lockdowns around the world and the consequent impact to our revenues, we took immediate steps to preserve cash and to protect the long-term future by agreeing to salary reductions for employees and the board, eliminating discretionary spending and taking advantage of the available government support schemes including VAT/PAYE deferrals and the Coronavirus Job Retention Scheme ("Scheme") in the UK and the Payroll Protection Program ("PPP") in the US. During this time, the Group received GBP0.7m in funding through the Scheme and GBP0.2m in PPP funds.
During the lockdown periods, we worked with our franchisees and major customers to help them prepare for the recommencement of normal trading by carrying out maintenance work and upgrading existing installations. We also helped our franchisees mitigate their own lower revenues by agreeing to reduced or deferred franchise royalty arrangements as we continued to implement procedures and practices to enhance our own operational efficiency. One of the outcomes from the pandemic was the launch in May 2020 of FiltaShield, a new service aimed specifically at helping businesses protect their customers, staff, and premises from COVID-19.
As a result of the actions described above, we enjoyed operating cash flow of GBP0.5m (2019: GBP0.2m outflow) and overall cash inflow of GBP0.2m (2019: GBP3.1m outflow, which included cash consideration for Watbio). The Group's gross cash at 30 June 2020 was GBP3.2m (31 December 2019: GBP2.9m) and net debt, including lease liabilities, was GBP1.9m (31 December 2019: GBP2.1m).
Operating Review
We continue to present and comment on our trading results according to the nature of the business, namely:
-- Fryer Management, the original core business, which includes recurring franchise royalties, national accounts income, waste oil sales and other continuing income derived through our franchise network;
-- Franchise Development, which includes the sales and resales of franchises as well as the additional territory sales to existing franchisees, drives increasing Fryer Management revenues;
-- Site Services is comprised of the recurring maintenance fees, either under contract or otherwise, from FOG, Pump, Drain and Seal services;
-- Equipment Sales & Installation, which is the entry point to new customers, drives increasing revenues from Site Services.
Fryer Management
Royalties and other revenue including from national accounts and waste oil sales, all of which is recurring in nature, from fryer management services provided through our franchise network were GBP4.1m (2019: GBP5.5m) and gross profit was GBP1.8m (2018: GBP2.4 million), an outcome which, given the almost complete closedown of the end customers for almost half the period, demonstrates the robust nature of our franchise model. We added 10 MFUs during the period, of which 9 were in Q1, and these will add to revenue over the second half and into future periods. Network revenue, which represents the total revenue of our North American franchisees for all services provided to customers, was up 10% in Q1 over prior year and before the impacts of COVID-19 were fully realised. Following a decline in Q2, we are beginning to see improvement in the first half of Q3. Many of the major customers, including sporting and events venues and educational establishments, have not yet re-opened and there will, therefore, be further revenue uplift when they do.
Franchise Development
Six new franchise agreements, two in Europe and four in North America, were all secured in Q1 and represented a strong start to the year. Throughout the second quarter we maintained our recruitment initiative, in many cases virtually, and continued to see interest from prospective franchisees. Whilst we did not realise any new agreements in Q2, we were successful in laying the groundwork for the resumption of trading. Since the end of June, we have secured two new franchises in Europe and one in North America with both locations experiencing growing pipelines.
Site Services
Site Services comprise Seal, FOG, Pump and Drain services, all of which are currently provided directly by our own operatives. We derived GBP2.9m or 35% of the Group's total revenue from Site Services. However, it should be noted that GBP2.3m of the revenue was achieved in Q1. Revenue in April was minimal, but we saw significant month on month improvement in May and June, a trend which has continued into the second half of the year. Importantly, as the business has returned, and our technicians come off furlough, the operational efficiencies are trending in line with expectations.
As more sites are opened or added, there is further improvement anticipated in operational efficiency and we will continue to proactively manage our need for additional resource to manage the growth.
Equipment Sales and Installation
This activity comprises FiltaFOG and FiltaPump Equipment Sales and Installation and delivered GBP0.8m or just under 10% of Group revenue which reflects prior performance. We anticipate a slower recovery here as our customers remain more focused on preventative maintenance and less inclined to incur larger one-time outlays during this initial resumption phase of trading. However, like our other offerings, we are seeing better month on month growth in the second half, albeit at a lower total volume.
New products
The Company has continued to innovate and seek additional products and services to add to its portfolio. One such service is FiltaShield, which was launched in May, to help customers to combat coronavirus. This offering comprises bacterial cleaning services using an anti-virus product, which can be taken as a one-off service or as a planned regular maintenance service. In addition, we now supply a temperature monitoring device for identifying potentially infected persons entering a customer's premises. These services are being offered as a Company-owned service and, in North America, through the franchise network.
We announced earlier this month that we have secured an exclusive licensing agreement with NTH Solutions, which is owned by North Tees and Hartlepool NHS Trust, to utilise an NHS approved disinfectant along with NHS accredited training as part of our Sanitation Service. This means that we will be considered as an NHS partner in the provision of such services.
People
We announced on 10 September that we have appointed Brian Riordan as Managing Director of our UK operations, effective 5 October 2020. Brian brings to Filta over 25 years' experience of working across food services and facilities management, sales and marketing, retail, and hotels. Most recently Brian was a Divisional Managing Director at Aramark UK, a leading food and facilities services provider. Brian will lead the growth and development of the existing UK business and will oversee the roll out and expansion of Filta's new partnership with NTH Solutions.
Dividends
Having regard to the ongoing uncertainty arising from the COVID-19 pandemic, and as part of a balanced approach to ensure that the Group maintains sufficient levels of liquidity throughout this period of uncertainty, the Board considers that it would not be appropriate to pay an interim dividend for 2020. However, the Board is conscious of the importance of income to shareholders and as performance progresses and visibility increases, it will keep future dividends, including the final dividend for 2020, under review.
Outlook
We have seen an improving sales trend in recent months with month on month revenues growing 40% in each of June and July. As we look to the remainder of the second half we are mindful of the ongoing wider macro-economic uncertainty caused by COVID-19 and whilst we cannot assume continued growth at these levels we will continue to support our customers as they reopen and believe that we are well placed to benefit from the acceleration in demand and to emerge as a stronger business once COVID-19 passes.
The Group is in a strong financial position and is a market leader in both of our major operating territories. We will continue to support our near-term financial performance with mitigating cost and cash actions where necessary or prudent, whilst continuing to pursue attractive investment opportunities as they become available, in order to position ourselves to take full advantage of future growth opportunities.
It is not possible to accurately predict how long the pandemic will last, nor how long or how severe the resulting financial impact will be on business globally. However, whilst we do not underestimate the challenges and uncertainties that remain, we believe that our business model, our multiple sources of revenue, many of which are long-term and recurring in nature, and our ability to adapt to changing circumstances, means that Filta is well placed to continue to expand and prosper.
Tim Worlledge Jason Sayers
Non-executive Chairman Chief Executive Officer
15 September 2020 15 September 2020
Condensed consolidated statement of comprehensive income
for the six months ended 30 June 2020
Hot Features
Premium
Unaudited Unaudited Audited
6 months 6 months Year ended
ended ended 30 31 December
30 June June 2019 2019
2020
Notes GBP GBP GBP
Revenue 3 8,296,948 12,197,105 24,922,526
Cost of sales (4,912,536) (7,156,099) (14,756,297)
------------ ------------ -------------
Gross profit 3,384,412 5,041,006 10,166,229
Other income 24,659 22,036 191,404
Distribution costs (73,195) (104,770) (203,344)
Administrative expenses (3,998,360) (4,344,136) (8,946,691)
------------ ------------ -------------
Operating (loss)/profit (662,484) 614,136 1,207,598
------------------------------------- ------ ------------ ------------ -------------
Analysed as:
Adjusted EBITDA 222,222 1,719,295 3,162,571
Acquisition and restructuring
related costs (17,379) (119,776) (296,410)
Depreciation and amortisation (668,482) (682,023) (1,396,932)
Share based payments, net of
cash settled 6 (198,845) (303,360) (261,631)
------------------------------------- ------ ------------ ------------ -------------
(662,484) 614,136 1,207,598
------------------------------------- ------ ------------ ------------ -------------
Finance costs, net (119,889) (140,543) (271,314)
------------ ------------ -------------
(Loss)/profit before tax (782,373) 473,593 936,284
Income tax expense (121,930) (113,766) (532,418)
Net (loss)/profit attributable
to owners (904,303) 359,827 403,866
Other comprehensive Income
Exchange differences on translation
of foreign operations 130,960 (23,799) (149,110)
------------ ------------ -------------
Total other comprehensive income 130,960 (23,799) (149,110)
Profit and total comprehensive
income (773,343) 336,028 254,756
============ ============ =============
Earnings per share
* Basic (pence) 2 (3.11) 1.24 1.39
* Diluted (pence) 2 (3.11) 1.22 1.39
Filta Group Holdings plc
Condensed consolidated statement of financial position
As at 30 June 2020
Unaudited Audited 31
30 June December
2020 2019
Notes GBP GBP
Non-current assets
Property, plant and equipment 1,365,726 1,336,110
Right of use asset 1,227,393 1,270,479
Deferred tax assets 713,000 678,497
Intangible assets 6,211,265 6,514,954
Goodwill 1,639,523 1,639,523
Deposits 5,585 5,272
Contract acquisition costs 413,710 415,663
Trade receivables 4 192,726 411,732
----------- -----------
11,768,928 12,272,230
----------- -----------
Current assets
Trade and other receivables 4 3,239,061 4,064,811
Contract acquisition costs 102,580 57,426
Inventories 1,773,386 1,759,955
Cash and cash equivalents 3,213,125 2,891,014
----------- -----------
8,328,152 8,773,206
----------- -----------
Total assets 20,097,080 21,045,436
=========== ===========
Current liabilities
Trade and other payables 5 2,883,894 3,260,885
Borrowings 800,220 792,672
Lease liability 285,573 332,974
Deferred income 562,007 534,066
----------- -----------
4,531,694 4,920,597
----------- -----------
Non-current liabilities
Deferred tax liability 1,096,010 1,159,121
Borrowings 3,076,410 2,976,887
Lease liability 943,532 882,447
Deferred income 2,441,500 2,496,173
----------- -----------
7,557,452 7,514,628
Total liabilities 12,089,146 12,435,225
----------- -----------
Equity
Share capital 2,909,816 2,908,535
Share premium 3,679,084 3,659,204
Other reserves 6 177,320 27,415
Translation reserve (402,115) (533,075)
Retained profits 1,643,829 2,548,132
Total equity 8,007,934 8,610,211
----------- -----------
Total equity and liabilities 20,097,080 21,045,436
=========== ===========
Filta Group Holdings plc
Condensed consolidated statement of changes in equity
for the six months ended 30 June 2020
Foreign
Share Share Other Merger Exchange Retained Total
Capital Premium Reserves Reserve Reserve Earnings Equity
GBP GBP GBP GBP GBP GBP GBP
Balance at 1
January
2020 2,908,535 3,659,204 367,102 (339,687) (533,075) 2,548,132 8,610,211
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
Loss for the
year - - - - - (904,303) (904,303)
Translation
differences - - - - 130,960 - 130,960
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
Total
comprehensive
income 130,960 (904,303) (773,343)
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
Dividends paid - - - - - - -
Issue of share
capital 1,281 19,880 - - - - 21,161
Equity - - - - - - -
consideration
paid
Shares based
payments - - 149,905 - - - 149,905
--------------- ----------
Balance at 30
June
2020 2,909,816 3,679,084 517,007 (339,687) (402,115) 1,643,829 8,007,934
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
Foreign
Share Share Other Merger Exchange Retained Total
Capital Premium Reserves Reserve Reserve Earnings Equity
GBP GBP GBP GBP GBP GBP GBP
Balance at 1
January
2019 2,891,863 3,372,351 329,634 (339,687) (383,965) 2,711,352 8,581,548
Adjustment on
initial
application
of IFRS
16, net of
tax - - - - - (8,971) (8,971)
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
At 1 January
2019
restated 2,891,863 3,372,351 329,634 (339,687) (383,965) 2,702,381 8,572,577
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
Profit for the
year - - - - - 359,827 359,827
Foreign
exchange
translation - - - - (23,799) - (23,799)
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
Total
comprehensive
income - - - - (23,799) 359,827 336,028
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
Dividends paid - - - - - (267,286) (267,286)
Issue of share
capital 16,173 281,385 - - - - 297,558
Equity
consideration
paid (250,000) - (250,000)
Share based
payments - - 187,152 - - - 187,152
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
Balance at 30
June
2019 2,908,036 3,653,736 266,786 (339,687) (407,764) 2,794,922 8,876,029
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
Profit for the
year - - - - - 44,039 44,039
Foreign
exchange
translation - - - - (125,311) - (125,311)
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
Total
comprehensive
income - - - - (125,311) 44,039 (81,272)
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
Dividends paid - - - - - (290,829) (290,829)
Issue of share
capital 499 5,468 - - - - 5,967
Equity - - - - - - -
consideration
due
Share based
payments - - 100,316 - - - 100,316
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
Balance at 31
December
2019 2,908,535 3,659,204 367,102 (339,687) (533,075) 2,548,132 8,610,211
--------------- ---------- ---------- ---------- ------------------------ ------------------- ---------- ------------
Filta Group Holdings plc
Condensed consolidated statement of cash flows
for the six months ended 30 June 2020
Unaudited Unaudited Audited
6 months 6 months Year
ended 30 June ended 30 ended 31
2020 June December
2019 2019
GBP GBP GBP
Operating activities
(Loss)/profit before tax (782,373) 473,593 936,284
Adjustments for non-cash operating
transactions:
Finance costs 119,889 140,543 271,314
Depreciation 38,658 150,585 216,677
Amortisation of intangible assets 467,630 531,438 857,992
Amortisation of right of use assets 162,194 - 322,262
(Gain)/loss on disposal of tangible
fixed assets (3,451) - (10,739)
Share based payment charge 198,845 303,360 283,215
--------- ----------- ------------------------
201,392 1,599,519 2,877,005
--------- ----------- ----------------------
Movements in working capital:
Decrease/(increase) in trade and
other receivables 1,162,681 264,512 271,249
Increase in contract acquisition
costs (43,200) (34,424) (78,814)
(Decrease)/increase in trade and
other payables (628,625) (1,088,008) (1,080,879)
Decrease in cash settled share option
liability - - (21,584)
(Increase)/decrease in inventories (13,431) (405,313) (538,301)
(Decrease)/increase in deferred revenue (26,732) (328,299) (629,680)
--------- ----------- -----------
Cash flow from operations 652,085 7,987 798,996
--------- ----------- -----------
Taxes paid (162,307) (233,788) (485,798)
--------- ----------- -----------
Net cash flow (used in)/generated
from operations 489,778 (225,801) 313,198
--------- ----------- -----------
Investing activities
Purchase of property, plant, and
equipment (8,760) (52,770) (288,251)
Proceeds from disposals of property,
plant, and equipment 3,525 - 39,697
Deferred consideration on subsidiary
acquisition - (1,800,293) (1,800,293)
Purchase of other intangible assets (163,310) (93,755) (176,538)
--------- ----------- -----------
Net cash (used in)/generated from
investing activities (168,545) (1,946,818) (2,225,385)
--------- ----------- -----------
Financing activities
Repayments of borrowings (31,385) (459,205) (876,272)
Net proceeds from borrowings 54,759 - -
Net proceeds from issue of share
capital - 18,164 31,525
Payment of lease liabilities (95,376) (149,072) (291,656)
Dividends paid to shareholders - (267,286) (558,115)
Interest paid (95,643) (119,618) (226,826)
--------- ----------- -----------
Net cash used in financing activities (167,645) (977,017) (1,921,344)
--------- ----------- -----------
Net change in cash and cash equivalents 153,588 (3,149,636) (3,833,531)
Cash and cash equivalents, beginning
of period 2,891,014 6,789,968 6,789,968
Exchange differences on cash and
cash equivalents 168,523 (19,133) (65,423)
--------- ----------- -----------
Cash and cash equivalents at end
of period 3,213,125 3,621,199 2,891,014
--------- ----------- -----------
Filta Group Holdings plc
Notes to the condensed consolidated interim financial statements
for the six months ended 30 June 2020
1. Accounting Policies
Basis of preparation
The condensed consolidated financial statements for the six months ended 30 June 2020 and 2019 are unaudited and were approved by the Directors on 14 September 2020. They do not constitute statutory accounts as defined in section 434 of the Companies Act 2006. The financial statements for the year ended 31 December 2019 were prepared in accordance with International Financial Reporting Standards as adopted by the EU and have been delivered to the Registrar of Companies. The report of the auditor on those financial statements was unqualified and did not draw attention to any matters by way of emphasis of matter.
Applicable standards
These unaudited consolidated interim financial statements have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union, under the historical cost convention. They have not been prepared in accordance with IAS 34, the application of which is not required to the interim financial statements of AIM companies. The interim financial statements have been prepared in accordance with the accounting policies set out in the Group's Annual Report and Accounts for the year ended 31 December 2019.
Basis of consolidation
The Group's financial statements consolidate the financial statements of Filta Group Holdings plc and its subsidiaries.
Going concern
Like many companies, the Group is being affected by the unprecedented events of COVID-19 and the associated impacts on our franchisees and customers so forecasting future activity levels in an uncertain economic environment is more challenging. The Directors have undertaken an assessment of going concern and liquidity, including financial forecasts up to the end of 2021, a period which extends beyond 12 months from the date of approval of these condensed consolidated financial statements, to reflect reasonably possible downsides. Within each scenario, the Group continues to have significant liquidity headroom with available cash on hand and unused overdraft facilities. In addition, current forecasts either meet bank covenant requirements or the Group has negotiated appropriate amendments to its covenants. Having reviewed the forecasts to the end of 2021 and taking account of its current cash and available facilities, the Directors consider that the Group has adequate financial resources to satisfy its working capital needs. Accordingly, they consider it appropriate to adopt the going concern basis of accounting in preparing the financial statements.
2. Earnings per share
The calculation of earnings per share is based on the following earnings and number of shares:
Unaudited Unaudited Audited
6 months 6 months Year ended
ended 30 June ended 30 31 December
June 201
2020 2019 2019
GBP GBP GBP
Earnings attributable to equity
holders of the Company (904,303) 359,827 403,866
Weighted average number of shares
Basic 29,096,123 28,999,198 29,041,697
Dilutive effect of share options
and awards 13,628 570,829 104,870
----------------------------- ---------------------- -------------------------
Diluted 29,109,751 29,570,027 29,146,567
----------------------------- ---------------------- -------------------------
3. Segmental Analysis
In January 2019, following the acquisition of Watbio Holdings, the Company began to make a number of changes to its organisational structure and management system consistent with its integration of the Watbio. With these changes, the Company has updated its reportable segments. The Company continues to have four reportable segments as follows:
The Site Service's segment includes our legacy Seal replacement service as well as capabilities in providing preventive maintenance and reactive services in the markets we serve. The Equipment Sales & Installation segment represents the provision of design, sale and installation solutions. The Franchise Development and Fryer Management segments remain unchanged. The Group also has three geographic segments: United Kingdom, North America and Europe.
The segments represent components of the Company for which separate financial information is available that is utilised on a regular basis by the chief operating decision maker (which takes the form of the Board of Directors), in determining how to allocate resources and evaluate performance. The segments are determined based on several factors, including client base, homogeneity of products, technology, delivery channels and similar economic characteristics.
Revenue and non-current assets by origin of geographical segment for all entities in the Group is as follows:
Revenue
Audited
Unaudited Unaudited Year
6 months 6 months ended
ended 30 June ended 30 June 31 December
2020 2019 2019
GBP GBP GBP
United Kingdom 4,014,968 6,579,387 13,124,702
North America 4,051,751 5,351,629 11,302,537
Europe 230,229 266,089 495,287
--------------- --------------- -------------
Total 8,296,948 12,197,105 24,922,526
Non-current assets
Audited
Unaudited As at
As at 30 June 31 December
2020 2019
GBP GBP
United Kingdom 9,263,999 9,643,205
North America 2,128,566 2,009,411
Europe 376,363 619,614
--------------- ---------------
Total 11,768,928 12,272,230
--------------- ---------------
Product and services revenue analysis
Revenue
Audited
Unaudited Unaudited Year
6 months 6 months ended
ended 30 June ended 30 June 31 December
2020 2019 2019
GBP GBP GBP
Franchise Development 521,204 807,747 1,494,674
Fryer Management 4,131,325 5,532,384 11,716,594
Equipment Sales & Installation 755,572 1,493,116 2,792,685
Site Services 2,888,847 4,363,858 8,918,573
--------------- --------------- -------------
Total 8,296,948 12,197,105 24,922,526
--------------- --------------- -------------
No customer has accounted for more than 10% of total revenue during the periods presented.
4. Trade and other receivables
Trade and other receivables consist of the following:
Group Unaudited Audited
6 months Year
ended ended
30 June 31 December
2020 2019
GBP GBP
Trade receivables, net 2,495,814 3,508,117
Prepayments and other receivables 493,519 402,206
Franchise payment plans 442,454 566,220
---------- -------------
3,431,787 4,476,543
---------- -------------
COVID-19 has also impacted our customers. Certain accounts have seen their sales ledger ageing profile deteriorate. We therefore assessed the level of credit risk to have increased in H1 2020 and, as a result, have taken a charge in the period of GBP239,767 to increase our provision.
Accounts receivable include amounts that the Filta Group has agreed may be settled over extended repayment terms.
5. Trade and other payables
Group Unaudited Audited
6 months Year
ended ended
30 June 31 December
2020 2019
GBP GBP
Trade payables 1,698,323 2,555,860
Taxes and social security 535,417 194,199
Accruals and other payables 650,154 510,826
---------- -------------
2,883,894 3,260,885
---------- -------------
Analysis of trade and other payables
These are classified as short term and are expected to be settled within 12 months from the reporting date.
6. Share option scheme
The Company maintains an EMI Share Option Scheme to incentivise executives and employees of Filta Group Holdings and its subsidiaries. For U.K. employees, Options have been awarded over a total of 1,985,000 ordinary shares, equivalent to 6.8% of the Company's current issued share capital. The options vest, subject to the satisfaction of certain conditions, over a period of 4 years from the date of grant. All options issued will meet the vesting conditions between 2019 and 2024 and are exercisable at any time after vesting and within 10 years from the grant date.
Additionally, all qualifying U.S. employees have been awarded share acquisition rights (SARs). The SARs are conditional bonuses whose value will be calculated by reference to the amount by which the price of the Company's ordinary shares has risen above the base price at the date of exercise, thus providing holders of SARs the same reward value as if the SARs were share options. The qualifying conditions and timing of vesting are identical to those within the share option scheme for UK employees. All SARs are settled in cash when exercised. A total of 667,500 SARs have been awarded.
In the ordinary course of business, an option will normally only be exercisable to the extent it has fully vested, and any applicable non-market performance conditions have been satisfied or waived. Options shall lapse to the extent unexercised on the tenth anniversary of the date of grant or such earlier date as specified by the Board at the date of grant.
As at 30 June 2020, a total of 1,550,000 (2019: 1,792,500) were outstanding, having a range of exercise prices from 0.97p to 2.30p (2019: 0.97p to 2.30p) and a weighted average exercise price of 1.81p (2019:1.54p). These outstanding awards have a weighted average contractual life of 7.73 years (2019: 8.69 years).
Movement in the number of share options and SARs outstanding during the year, including grants, exercises and forfeitures were as follows:
Share Share acquisition
Options rights Total
Outstanding at 1 January
2019 210,000 330,000 540,000
----------------------------- ------------------- ------------------------------- ------------------
Granted on 11 January
2019 (2.15p) 1,002,500 175,000 1,177,500
Granted on 15 May 2019
(2.30p) 187,500 110,000 297,500
Granted on 18 November
2019 (1.46p) 352,500 22,500 375,000
Total granted during the
year 1,542,500 307,500 1,850,000
----------------------------- ------------------- ------------------------------- ------------------
Exercised during the year
(0.97p) (32,500) (22,500) (55,000)
Total exercised during
the year (32,500) (22,500) (55,000)
----------------------------- ------------------- ------------------------------- ------------------
Forfeited during the year
(0.97p) (50,000) (80,000) (130,000)
Forfeited during the year
(1.74p) (7,500) (20,000) (27,500)
Forfeited during the year
(2.15p) (407,500) - (407,500)
Forfeited during the year
(2.30p) (50,000) - (50,000)
Forfeited during the year
(1.46p) (30,000) - (30,000)
Total forfeited during
the year (545,000) (100,000) (645,000)
----------------------------- ------------------- ------------------------------- ------------------
Total Outstanding at 31
December 2019 1,175,000 515,000 1,690,000
----------------------------- ------------------- ------------------------------- ------------------
Forfeited during the period
(0.97p) (5,000) - (5,000)
Forfeited during the year
(2.15p) (52,500) (7,500) (60,000)
Forfeited during the year
(1.46p) (60,000) (15,000) (75,000)
Total forfeited during
the period (117,500) (22,500) (140,000) ----------------------------- ------------------- ------------------------------- ------------------ Total outstanding at 30 June 2020 1,057,500 492,500 1,550,000 ----------------------------- ------------------- ------------------------------- ------------------ Exercisable at 30 June 2018 67,500 132,500 200,000 ----------------------------- ------------------- ------------------------------- ------------------
During the period ended 30 June 2020 the Company recognised total expense; net of cash settled awards of GBP198,845 (2019: GBP303,360) related to the fair value of the share-based payment arrangements. This included GBP149,905 (2019: GBP187,152) related to equity-settled share options and GBP48,940 (2019: GBP116,208) from cash-settled SARs.
These amounts were determined using the Black Scholes model, with the following assumptions for each type of award granted:
Stock Options
Weighted average share price 113.8p
---------------
Exercise price 189.5p
---------------
Risk free rate 1.95%
---------------
Dividend yield 0.0%
---------------
Volatility 50.1%
---------------
Share Appreciation Rights
Weighted average share price 113.8p
---------------
Exercise price 162.8p
---------------
Risk free rate 1.93%
---------------
Dividend yield 0.0%
---------------
Volatility 50.2%
---------------
7. Dividends
As a part of the Group's ongoing efforts to conserve cash, the Board is not recommending the payment of an interim dividend in respect of the period ended 30 June 2020.
8. Date of approval of interim financial statements
The unaudited consolidated interim financial statements were approved by the Board on 14 September 2020. Electronic copies are available on the Filta Group Holdings plc website, www.filtaplc.com.
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END
IR ZZGMLLDVGGZM
(END) Dow Jones Newswires
September 15, 2020 02:00 ET (06:00 GMT)
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