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Share Name Share Symbol Market Type Share ISIN Share Description
Latham (james) Plc LSE:LTHM London Ordinary Share GB00B04NP100 ORD 25P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.0% 897.50 870.00 925.00 905.00 897.50 905.00 12,363 08:00:05
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Support Services 247.1 15.7 63.1 14.2 179

Latham(James) PLC Final Results

01/07/2020 7:00am

UK Regulatory (RNS & others)


Latham (james) (LSE:LTHM)
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RNS Number : 5989R

Latham(James) PLC

01 July 2020

James Latham PLC

("James Latham" or the "Company")

Final Results

Chairman's statement

I am pleased to report good trading results for the financial year to 31 March 2020

Revenue for the financial year to 31 March 2020 was GBP247.1m, up 5.1% on last year's GBP235.1m. Like for like volumes increased by 1.8%, with the growth mainly on delivered business from our own warehouses, with a reduction in direct volumes shipped from the ports or from the manufacturers. The cost price of our products steadily fell throughout the year, ending the year 3.3% lower than the comparative twelve months. Abbey Wood in Ireland has been successfully integrated into the Lathams business and is now starting to provide a useful contribution to the Group's results.

Gross profit for the financial year to 31 March 2020 was 17.6% compared with 17.2% in the previous financial year. This figure includes warehouse costs, which have increased due to extended working hours with four of our depots now working 24 hours a day and further investment in our racking systems.

Profit before tax is GBP15.7m, up GBP0.4m on last year's GBP15.3m. Profit after tax for the year is GBP12.5m, up from last year's GBP12.4 m

Earnings per share is 63.1p (2019: 63.1p). Adjusted earnings per ordinary share (see Note 5), adjusted for the effect on the introduction of IFRS 16 on Leasing this year and the previous year's results of the property profit and the one off cost relating to Guaranteed Minimum Pensions were 64.0p (2019: 61.6p) an increase of 3.9%.

As at 31 March 2020 net assets have increased to GBP104.3m (2019: GBP98.0m). We have adopted IFRS 16 on Leasing in these results, which has had an insignificant effect on profit before. Non current assets have increased by GBP7.5m from 31 March 2019. GBP4.9m of this increase relates to the creation of a new asset class of Right of Use Assets relating to the introduction of IFRS 16 on Leasing. In addition we acquired Dresser Mouldings (Rochdale) Ltd for cash consideration of GBP1.0m, and have also invested GBP1.0m in redeveloping the Gateshead warehouse. Inventory levels have increased to GBP44.3m from GBP42.4m last year. Trade receivables at the year end were GBP4.4m higher than the previous year as we saw a reduction in cash received at the end of March due to the COVID-19 pandemic. However trade receivables have now returned close to normal levels. There was another low bad debt charge of 0.20% of turnover for the year. Cash and cash equivalents of GBP17.0m (2019: GBP15.5m), remain strong with good cash flows from operating activities.

At 31 March 2020 the deficit of the defined benefit scheme under IAS19 (revised) was GBP11.8m, up GBP3.1m compared with GBP8.7m last year. The calculation of the pension deficit remains very sensitive to changes in assumptions, and was affected by the reduction in market values of investments at the end of March.

Final dividend

The Board has declared a final dividend of 10.0p per Ordinary Share (2019: 12.9p). The dividend is payable on 4 September 2020 to ordinary shareholders on the Company's register at close of business on 7 August 2020. The ex-dividend date will be 6 August 2020. The total dividend per ordinary share of 15.5p for the year (2019: 17.9p) is covered 4.1 times by earnings (2019: 3.5 times). The board considers this level of dividend to be prudent given the balance between the good results achieved in the year to 31 March 2020 and the difficult market conditions experienced during the first quarter of the current financial year caused by the COVID-19 pandemic.

Current and future trading

The board responded quickly and decisively to protect the business and the employees from COVID-19, with quick action to reduce costs where possible, manage the stock and preserve cash. COVID-19 has had a considerable affect on the start of our trading year. We remained open at most of our distribution sites to support NHS projects and other essential services, as well as servicing our customers that managed to remain open. April was a particularly challenging month with sales at 40% of April 2019 sales. We have seen more customers coming back to work throughout May, with positive trends on numbers of orders taken and total number of trading customers, with sales at 60% of May 2019 sales. This positive trend is continuing in June, and sales are expected to be 80% of June 2019 sales. I have been incredibly pleased at how our staff have managed to work through this challenging period, and the resilience of the business. The skill of our senior staff with the support of the board has undoubtedly limited the negative impact of COVID-19 on the business. The full impact of the virus and the effect on the wider economy are impossible to predict at this stage.

Development Strategy

The board believes that there are plenty of opportunities to develop and grow our business. The strength of the business will allow us to avoid the worst of any potential downturn in the economy and seize on any opportunities to further develop the business. We will continue to look to grow the business through any suitable acquisitions to support key market sectors and also identify new products in market sectors where we are focussing our efforts. We will continue to invest in our warehouses and extend the working day at our depots to ensure that we meet the future delivery needs of our existing and new customers. Our focus will be on completing the Gateshead site development, and a significant racking project at our Thurrock facility. We have also fast tracked our on line presence project, and the use of technology as we look to drive more efficiencies into our business, to ensure we are in the best place possible to deal with the future. There are clearly challenges as we enter a post Brexit and COVID-19 world, but the board remains confident that the Company is in a position of strength which will allow us to plan for a positive future.

Nick Latham

Chairman

30 June 2020

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No 596/2014.

For further information please visit www.lathams.co.uk or contact:

 
 James Latham plc                                Tel: 01442 849 100 
 Nick Latham, Chairman 
 David Dunmow, Finance Director 
 
 
 SP Angel Corporate Finance LLP 
 Matthew Johnson / Charlie Bouverat (Corporate   Tel: 0203 470 0470 
  Finance) 
 Abigail Wayne (Corporate Broking) 
 

JAMES LATHAM PLC

CONSOLIDATED INCOME STATEMENT

For the year to 31 March 2020

 
                                                   Audited            Audited 
---------------------------------------  -----------------  ----------------- 
                                          Year to 31 March   Year to 31 March 
                                                      2020               2019 
---------------------------------------  -----------------  ----------------- 
                                                    GBP000             GBP000 
---------------------------------------  -----------------  ----------------- 
 
 Revenue                                           247,100            235,132 
 
 Cost of sales (including warehouse 
  costs)                                         (203,656)          (194,686) 
---------------------------------------  -----------------  ----------------- 
 
 Gross profit                                       43,444             40,446 
 
 Selling and distribution costs                   (19,251)           (18,082) 
 Administrative expenses                           (8,196)            (7,896) 
 Operating Profit                                   15,997             14,468 
 
 Profit on disposal of property                          -              1,052 
 Finance income                                         82                 71 
 Finance costs                                       (417)              (256) 
---------------------------------------  -----------------  ----------------- 
 
 Profit before tax                                  15,662             15,335 
 
 Tax expense                                       (3,181)            (2,913) 
---------------------------------------  -----------------  ----------------- 
 
 Profit after tax attributable 
  to owners of the parent company                   12,481             12,422 
=======================================  =================  ================= 
 
 Earnings per ordinary share (basic)                 63.1p              63.1p 
=======================================  =================  ================= 
 Earnings per ordinary share (diluted)               63.0p              63.0p 
=======================================  =================  ================= 
 

All results relate to continuing operations.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year to 31 March 2020

 
                                              Audited    Audited 
-------------------------------------------  --------  --------- 
                                                 2020       2019 
-------------------------------------------  --------  --------- 
                                               GBP000     GBP000 
-------------------------------------------  --------  --------- 
 Profit after tax attributable to owners 
  of the parent company                        12,481     12,422 
 
 Other comprehensive income 
 Actuarial loss on defined benefit pension 
  scheme                                      (4,823)    (1,360) 
 Deferred tax relating to components 
  of other comprehensive income                   916        314 
 Foreign translation gain/(charge)                 80       (31) 
-------------------------------------------  --------  --------- 
 Other comprehensive income for the year, 
  net of tax                                  (3,827)    (1,077) 
-------------------------------------------  --------  --------- 
 Total comprehensive income attributable 
  to owners of the parent company               8,654     11,345 
===========================================  ========  ========= 
 

JAMES LATHAM PLC COMPANY REGISTRATION NUMBER 65619

CONSOLIDATED BALANCE SHEET

At 31 March 2020

 
                                            Audited    Audited 
---------------------------------------  ----------  --------- 
                                               2020       2019 
---------------------------------------  ----------  --------- 
                                             GBP000     GBP000 
---------------------------------------  ----------  --------- 
 Assets 
 Non-current assets 
 Goodwill                                       872        523 
 Other intangible assets                      1,822      1,989 
 Property, plant and equipment               35,952     34,159 
 Right-of-use-assets                          4,895          - 
 Deferred tax asset                           2,258      1,577 
 Total non-current assets                    45,799     38,248 
 
 Current assets 
 Inventories                                 44,288     42,350 
 Trade and other receivables                 47,046     42,613 
 Cash and cash equivalents                   16,950     15,541 
 Total current assets                       108,284    100,504 
---------------------------------------  ----------  --------- 
 Total assets                               154,083    138,752 
---------------------------------------  ----------  --------- 
 
 Current liabilities 
 Lease liabilities                            1,178          - 
 Trade and other payables                    28,686     27,113 
 Tax payable                                      -      1,193 
---------------------------------------  ----------  --------- 
 Total current liabilities                   29,864     28,306 
 
 Non-current liabilities 
 Interest bearing loans and borrowings          592        597 
 Lease liabilities                            3,857          - 
 Retirement and other benefit 
  obligation                                 11,812      8,714 
 Other payables                                 392        413 
 Deferred tax liabilities                     3,289      2,762 
---------------------------------------  ----------  --------- 
 Total non-current liabilities               19,942     12,486 
---------------------------------------  ---------- 
 Total liabilities                           49,806     40,792 
---------------------------------------  ----------  --------- 
 
 Net assets                                 104,277     97,960 
=======================================  ==========  ========= 
 
 Capital and reserves 
 Issued capital                               5,040      5,430 
 Share-based payment reserve                     25        259 
 Own shares                                   (619)      (923) 
 Capital reserve                                398          3 
 Retained earnings                           99,433     93,191 
---------------------------------------  ----------  --------- 
 Total equity attributable to 
  equity shareholders of the parent 
  company                                   104,277     97,960 
=======================================  ==========  ========= 
 

The Company's profit for the year was GBP2,971,000 (2019: GBP679,000).

JAMES LATHAM PLC

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Attributable to the owners of the parent company

 
                                           Share-based 
                                 Issued      payment       Own shares     Capital     Retained     Total 
                                 capital     reserve                      reserve     earnings     Equity 
                                GBP'000      GBP'000       GBP'000       GBP'000     GBP'000     GBP'000 
 Balance at 1 April 
  2018 - audited                   5,040           184          (529)           3       85,091     89,789 
 Profit for the year                   -             -              -           -       12,422     12,422 
 Other comprehensive 
  income: 
 Actuarial loss on 
  defined benefit pension 
  scheme                               -             -              -           -      (1,360)    (1,360) 
 Deferred tax relating 
  to components of other 
  comprehensive income                 -             -              -           -          314        314 
 Foreign translation 
  charge                               -             -              -           -         (31)       (31) 
                              ----------  ------------  -------------  ----------  -----------  --------- 
 Total comprehensive 
  income for the year                  -             -              -           -       11,345     11,345 
 Transactions with 
  owners: 
 Dividends                             -             -              -           -      (3,363)    (3,363) 
 Exercise of options                   -          (19)              -           -           19          - 
 Deferred tax on share 
  options                              -             -              -           -           31         31 
 Transfer of treasury 
  shares                               -             -           (82)           -           82          - 
 Write down on conversion 
  of ESOP shares                       -             -             14           -         (14)          - 
 Purchase of preference 
  shares                             390             -          (478)           -            -       (88) 
 Change in investment 
  in ESOP shares                       -             -            152           -            -        152 
 Share-based payment 
  expense                              -            94              -           -            -         94 
                              ----------  ------------  -------------  ----------  -----------  --------- 
 Total transactions 
  with owners                        390            75          (394)           -      (3,245)    (3,174) 
 Balance at 31 March 
  2019 - audited                   5,430           259          (923)           3       93,191     97,960 
 Change in accounting 
  policy (IFRS16)                      -             -              -           -          291        291 
 Deferred tax on IFRS 
  16                                   -             -              -           -         (55)       (55) 
 As at 1 April 2019 
  (as restated)                    5,430           259          (923)           3       93,427     98,196 
 Profit for the year                   -             -              -           -       12,481     12,481 
 Other comprehensive 
  income: 
 Actuarial loss on 
  defined benefit pension 
  scheme                               -             -              -           -      (4,823)    (4,823) 
 Deferred tax relating 
  to components of other 
  comprehensive income                 -             -              -           -          916        916 
 Foreign translation 
  charge                               -             -              -           -           80         80 
                              ----------  ------------  -------------  ----------  -----------  --------- 
 Total comprehensive 
  income for the year                  -             -              -           -        8,654      8,654 
 Transactions with 
  owners: 
 Dividends                             -             -              -           -      (3,633)    (3,633) 
 Exercise of options                   -         (253)          (261)           -        1,463        949 
 Deferred tax on share 
  options                              -          (45)              -           -            -       (45) 
 Purchase of preference 
  shares                               5             -              -           -            -          5 
 Cancellation of preference 
  share                            (395)             -            478         395        (478)          - 
 Change in investment 
  in ESOP shares                       -             -             87           -            -         87 
 Share-based payment 
  expense                              -            64              -           -            -         64 
                              ----------  ------------  -------------  ----------  -----------  --------- 
 Total transactions 
  with owners                      (390)         (234)            304         395      (2,648)    (2,573) 
 Balance at 31 March 
  2020 - audited                   5,040            25          (619)         398       99,433    104,277 
                              ==========  ============  =============  ==========  ===========  ========= 
 

JAMES LATHAM PLC

CONSOLIDATED CASH FLOW STATEMENT

For the year to 31 March 2020

 
                                          Audited   Audited 
---------------------------------------  --------  -------- 
                                             2020      2019 
---------------------------------------  --------  -------- 
                                           GBP000    GBP000 
---------------------------------------  --------  -------- 
 Net cash flow from operating 
  activities 
 Cash generated from operations            13,528    10,115 
 Interest paid                                (3)       (8) 
 Income tax paid                          (3,851)   (2,651) 
---------------------------------------  --------  -------- 
 Net cash inflow from operating 
  activities                                9,674     7,456 
---------------------------------------  --------  -------- 
 
 Cash flows from investing activities 
 Interest received and similar 
  income                                       82        71 
 Acquisition of businesses net 
  of cash and cash equivalents 
  acquired                                  (578)   (1,604) 
 Purchase of property, plant 
  and equipment                           (3,886)   (2,362) 
 Proceeds from sale of property, 
  plant and equipment                         152     1,743 
 Net cash outflow from investing 
  activities                              (4,230)   (2,152) 
---------------------------------------  --------  -------- 
 
 Cash flows from financing activities 
 Sale of treasury shares                    1,036       152 
 Purchase of treasury shares                    -     (478) 
 Lease liability payments                 (1,390)         - 
 Equity dividends paid                    (3,633)   (3,363) 
 Preference dividend paid                    (48)      (63) 
 Net cash outflow from financing 
  activities                              (4,035)   (3,752) 
---------------------------------------  --------  -------- 
 Increase in cash and cash equivalents 
  for the year                              1,409     1,552 
=======================================  ========  ======== 
 Cash and cash equivalents at 
  beginning of the year                    15,541    13,989 
---------------------------------------  --------  -------- 
 Cash and cash equivalents at 
  end of the year                          16,950    15,541 
=======================================  ========  ======== 
 

JAMES LATHAM PLC

Notes to the audited preliminary financial information

1. The preliminary financial information presented in this report is audited and has been prepared in accordance with the recognition and measurement principles of International Financial Reporting Standards ('IFRS') as adopted by the EU set out in the Group accounts for the years ended 31 March 2019 and 31 March 2020, except for IFRS 16 'Leases" in respect of 31 March 2019, and does not contain all the information to be disclosed in financial statements prepared in accordance with IFRS.

2. The directors propose a final dividend of 10.0p per ordinary share, which will absorb GBP1,990,000 (2019: 12.9p absorbing GBP2,537,000), payable on 4 September 2020 to shareholders on the Register at the close of business on 7 August 2020. The ex-dividend date is 6 August 2020.

The figures for the year ended 31 March 2019 and as at 31 March 2020 have been extracted from the audited statutory accounts for that year. The statutory accounts for the year ended 31 March 2020 have yet to be delivered to the Registrar of Companies and have been prepared in accordance with IFRS as adopted by the EU and those parts of the Companies Act 2006 that remain applicable to companies reporting under IFRS. The preliminary financial information does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006, and does not contain all the information required to be disclosed in a full set of IFRS financial statements.

Statutory accounts for the year ended 31 March 2020 will be delivered to the Registrar of Companies and sent to Shareholders shortly. The Annual Report and Accounts may also be viewed in due course on James Latham plc's website at www.lathams.co.uk

The audit report on the statutory financial statements for the year ended 31 March 2020 is unqualified and does not include reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report and does not contain any statement under Section 498(2) or (3) of the Companies Act 2006.

Statutory accounts for the year ended 31 March 2019 have been filed with the Registrar of Companies. The auditor's report on those accounts was unqualified and did not include reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report and did not contain a statement under section 498(2) and (3) of the Companies Act 2006.

3. This announcement was approved and authorised for issue by the Board of Directors on 30 June 2020.

   4.   Net cash flow from operating activities 
 
                                                      Year to    Year to 31 
                                                      31 March    March 2019 
                                                  2020 audited       audited 
                                                        GBP000        GBP000 
 
   Profit before tax                                    15,662        15,335 
   Adjustment for finance income and cost                  335           185 
   Depreciation, amortisation and impairment             3,790         2,036 
   Profit on disposal of property, plant 
    and equipment                                        (121)       (1,079) 
   Increase in inventories                             (1,659)       (2,282) 
   Increase in receivables                             (3,963)       (1,105) 
   Increase)/(decrease) in payables                      1,244       (1,825) 
   Retirement benefits non cash amounts                (1,904)       (1,213) 
   Translation non cash amounts                             80          (31) 
   Share-based payments non cash amounts                    64            94 
   Cash generated from operations                       13,528        10,115 
                                                --------------  ------------ 
 

5. Earnings per ordinary share is calculated by dividing the net profit for the period attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period.

 
                                                                Year to           Year to 31 
                                                               31 March           March 2019 
                                                           2020 audited              audited 
                                                           GBP000               GBP000 
 
 Net profit attributable to ordinary shareholders                12,481               12,422 
 
 GMP equalisation                                                     -                  746 
 Profit on disposal of property                                       -              (1,052) 
 IFRS16 Leases                                                      186                    - 
                                                    -------------------  ------------------- 
 
 Net profit attributable to ordinary shareholders 
  adjusted for GMP equalisation cost, profit 
  on disposal of property and IFRS16 Leases                      12,667               12,116 
                                                    ===================  =================== 
 
                                                     Number '000                 Number '000 
 Weighted average share capital                                  19,781               19,674 
 Add: diluted effect of share capital options 
  issued                                                             23                   28 
 Weighted average share capital for diluted 
  earnings per ordinary share calculation                        19,804               19,702 
                                                    -------------------  ------------------- 
 
 

The earnings per share figure is shown on the Income statement. In the previous year, the earnings were stated after the profit on a disposal of property and GMP equalisation and in the current year, we have the effect of IFR16 leases. The figures below show the earnings per share if these 3 items were excluded to show a comparable figure:

 
 Earnings per ordinary share (basic, excluding 
  GMP equalisation, profit on disposal of 
  property and IFR16 Leases)                      64.0p   61.6p 
                                                 ======  ====== 
 
 Earnings per ordinary share (diluted, 
  excluding GMP equalisation, profit on 
  disposal of property and IFRS 16 Leases)        64.0p   61.5p 
                                                 ======  ====== 
 

6. The Annual General Meeting of James Latham plc will be held at Unit 1 Swallow Park, Finway Road, Hemel Hempstead, Herts, HP2 7QU on 2 September 2020 at 12.30pm.

Impact of COVID-19

Due to the current restrictions imposed due to the COVID-19 pandemic, the Annual General Meeting this year will not be open for shareholders to attend in person. To ensure that your vote counts, please submit your proxy form appointing the Chairman as your proxy. Questions can be submitted in advance to plc@lathams.co.uk and these will be answered during the meeting. Full voting details and answers to questions will be posted on the Investor Page at www.lathams.co.uk/investors .

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

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