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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Miller Fisher | LSE:MFG | London | Ordinary Share | GB0006946296 | ORD 5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.00 | - |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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RNS Number:1224V
Miller Fisher Group PLC
26 April 2002
For Immediate Release 26 April 2002
MILLER FISHER GROUP PLC
PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2001
FINANCIAL RESTRUCTURING IS COMPLETE
Miller Fisher Group plc, the provider of support services to the insurance and
financial services industries, announces its preliminary results for the year
ended 31 December 2001.
Key points:
• Turnover £45.0 million (2000: £58.8 million)
• Operating loss before exceptional items and interest £4.9 million (2000:
profit - £1.1 million)
• Basic loss per ordinary share 10.64p (2000: (1.95p))
• Dividend per share 0p (2000: 0.10p)
• Financial restructuring complete: HBOS agreed to subscribe to £13.25
million cumulative redeemable convertible preference shares in consideration
of £13.25m of debt at the bank.
• Malcolm Hughes appointed Chief Executive and John Hodson appointed
Chairman.
Commenting on the outlook for the current year, Malcolm Hughes, Chief Executive
said:
"Miller Fisher has undergone a period of change but has emerged as a stronger,
leaner firm.
"The challenge now is to use this as the foundation from which to seize all
opportunities to grow the Group into a leading supplier of outsourcing services
to the insurance and financial services industries."
For further information contact:
Miller Fisher Group plc 020 7398 8700
Malcolm Hughes - Chief Executive
Richard Horton - Finance Director
Grandfield 020 7417 4170
Clare Abbot / Olly Scott
MILLER FISHER GROUP PLC
PRELIMINARY STATEMENT OF FINAL RESULTS
FOR THE YEAR ENDED 31 DECEMBER 2001
OVERVIEW
As Shareholders will be aware, 2001 was a difficult year for the Group. The
first half was reasonably encouraging with the benefits of reduced costs
resulting in a return to profitability at the operating level and borrowing
being reduced by disposals. Unfortunately, progress was not maintained in the
second half.
In November 2000, we announced that, in conjunction with our advisers, we were
examining ways to maximise shareholder value. A number of options were examined,
including possible public to private transactions, asset sales and capital
raisings. As part of this process we had discussions with a number of parties,
which gave rise to a good deal of speculation in both the trade and financial
press. As a result in February 2001 we were required to make a statement that we
were in talks that might or might not have led to an offer being made for the
Group. In the event, these discussions proved inconclusive and we announced in
April 2001 that they were at an end.
This process created uncertainty over the Group's future and ownership,
especially in the minds of clients and staff. Most of the contracts that we
enter into are for periods of more than a year; possibly for two or three years.
Given the uncertain climate, we found it very difficult in this period,
especially in the UK, to secure new business and retain customer confidence. As
a result, the second half of the year was characterised by falling revenues in
the UK, leading to trading losses and pressures on cash flow. Although overheads
were reduced substantially, this created further exceptional short term costs
and related cash requirements.
During the latter part of 2001 the future of the Group, especially its financial
position, had to be improved. This would then enable clients to trade with
confidence with the Group, staff morale would improve, and new business could be
won in the UK to rebuild the revenues and profits.
Accordingly, at the end of the year, we entered into arrangements with the Bank
of Scotland whereby the Bank would subscribe for £13.25 million of new equity in
the form of preference shares, thereby substantially reducing our bank debt.
These preference shares give the Bank of Scotland the right to convert into 49%
of the enlarged equity. Full details of these arrangements were contained in a
Circular sent to Shareholders on 8 February 2002 and the arrangements were
finalised at the EGM on 4 March 2002.
These events are reflected in our historic results and have resulted in the
Group declaring a substantial loss before tax for 2001, but shareholders should
note that 60% of the loss is accounted for by exceptional items and a write down
of goodwill.
Results
The Group reported an operating loss before exceptional items and interest of
£4.9m compared to a profit of £1.1m in 2000.
After exceptional costs, which are analysed in note 3 to this statement, of
£5.1m and interest of £2.2m there was an overall loss before taxation,
impairment of goodwill and profit on disposal of subsidiary undertaking of
£12.2m compared to £3.1m in 2000.
An impairment review of goodwill was carried out and as a result a writedown of
£5.0m has been taken giving an overall loss for the year of £16.7m compared to
£3.1m in 2000. Further information on the basis of this writedown is set out in
note 4 to this statement.
Loss per share
The loss per share before exceptional items amounted to 4.71p (2000: 0.57p loss)
and after exceptional items showed a loss of 10.64p (2000: 1.95p loss).
Turnover
Turnover for the Group's continuing operations was £41.1m (2000: £48.3m). The
turnover of Homecare Insurance Limited, which was sold on 8 May 2001 amounted to
£3.8m (2000: £10.5m).
Dividends
The Board did not declare an interim dividend (2000: 0.10p) and is not proposing
a final dividend (2000: nil).
OPERATIONS
Claims management, Administration and Inspection services
In the UK Miller Fisher provides loss adjusting, outsourcing and third party
administration services, investigation services and accident and transit damaged
motor vehicle inspection services.
The UK loss adjusting business had a difficult year, particularly in the second
half where uncertainty over the Group's finances and future resulted in
declining revenues. Operational changes, including a reduction in the number of
regional service centres, were implemented to reduce the cost base and improve
productivity and client service although the benefit of these reductions did not
really begin to flow through until November and December. We now operate from 12
service centres in the UK. We expect the full benefit will be seen in the
current year.
The Business Solutions and third party administration business also had a
difficult year and did not achieve its trading objectives for a number of
reasons, including management and service issues. New business revenues proved
difficult to develop or retain in the context of the Group's position.
Significant management changes were made during the year and the operation has
been substantially upgraded to deal with historic service issues.
Miller Farrell
Miller Farrell in Ireland had another excellent year with revenues increasing by
11% to £6.0m. There are considerable opportunities for Miller Farrell to
capitalise on its strong position in the local market and develop a substantial
third party administration business. During the last quarter of 2001, the
necessary preliminary work to establish a Third Party Administration operation
was carried out and Miller Farrell has already won its first contract with a
large insurer. Other opportunities are being pursued and this activity has
substantial potential in the current year and beyond.
Miller International
Miller International, comprising our international adjusting and inspection
operations in Dubai, Singapore, Caracas, and Hong Kong, made further progress
during the year. Turnover increased by 24%, principally as a result of
developments in the Far East and progress in the London office. We have
recruited a number of experienced professionals who have been instrumental in
securing new work. The division continues to develop an important niche within
the international reinsurance and construction markets.
Homecare Insurance
As previously announced, this subsidiary was sold on 9 May 2001 for net proceeds
of £1.9m. In addition, the acquirors assumed related bank debt of £2.25m. Its
results (an operating profit of £160,000) are included up to the date of
disposal and are shown as a discontinued activity. The profit on disposal is
disclosed in accordance with FRS 3.
FINANCE AND BALANCE SHEET
Although net borrowings showed a decline in the first six months of 2001, this
was reversed in the second half. Bank borrowings at 31 December 2001 amounted to
£25.2m compared to £24.6m at 31 December 2000. However, the restructuring agreed
with the Bank of Scotland has had a substantial positive impact on the balance
sheet in reducing bank debt and increasing the equity base. Since this is so
material we have set out, for the benefit of shareholders, a proforma balance
sheet reflecting the restructuring. This shows on a proforma basis, that bank
debt is reduced to £13.25m, and shareholders' funds increased to £19.6m. The
impact is explained in more detail in note 14 to this statement.
An impairment review was carried out in accordance with FRS 11 to corroborate
the value of goodwill and resulted in a writedown of £5.0m. The basis of the
impairment review is set out in note 4 to this statement.
BOARD CHANGES
As previously announced, Mr SV Pyatt, Group Managing Director, retired on 30
June 2001 and Mr KA Kenny, Chief Executive, stepped down on 31 December 2001.
Malcolm Hughes, the Chief Executive of Miller Farrell, the success of which I
referred to earlier in this statement, was appointed Group Chief Executive on 6
December 2001 and Tom Anderson joined the Board as Director of Operations on the
same date. Sir Timothy Kitson retired as Chairman on 31 March 2002 and was
replaced by myself. I thank all those leaving the Board for their contribution
to the Group.
ANNUAL GENERAL MEETING
The Annual General Meeting of the Company will be held at 21 New Street,
Bishopsgate, London EC2M on 24 June 2002.
OUTLOOK
Now that the financial restructuring, described above, has been completed, we
face 2002 with renewed confidence. We have substantially reduced the UK cost
base - by about £8m in a full year, established a new management team,
strengthened the Group's financial structure, with the Bank of Scotland as a
major shareholder. This has taken a large part of management time and focus
which can now be devoted to revenue generation and related matters, where
performance in 2001 and to date has been clearly below par.
Our current trading position has now stabilised and provides a base from which
to build on the benefits of the recent restructuring and changes within the
Group. During the first quarter we have consolidated our existing client base
and have experienced growth and an increased demand for our services from a
number of key clients.
Miller Farrell, in Ireland has had an exceptionally strong start to the year,
particularly in the area of property claims. In addition, Miller Farrell has
entered the wider business solutions and third party administration market and
has secured a major outsourcing agreement with Eagle Star, which underpins the
drive into this market sector, where there is strong growth potential.
Our UK business is going through a period of transition following past
difficulties and has recently benefited from a complete operational and
management restructuring. The outlook is encouraging and we hope to make
announcements concerning new business wins across all areas of business activity
shortly. We are involved in contract negotiations for substantial opportunities
in UK adjusting, third party administration and motor services.
The Group's international and technical operation continues to make considerable
progress and is becoming recognised as the leading provider of services in the
area of construction claims and major infrastructure projects. We are seeing new
business growth throughout all our operating locations both in the UK and
overseas. Recent nominations have been obtained from Balfour Beatty UK, the
renewal of the Channel Tunnel Rail Link contract, Canary Wharf Group Plc, and
$1.2 billion oil pipeline project in South America on behalf of Munich and Swiss
Re.
I believe that the Group is already seeing the first signs of recovery. However,
the way ahead remains challenging and is not without risk. We have to accept,
however, that there is quite a lead time between identifying and winning new
business and it translating into revenues. It will take a great deal of
commitment, hard work and patience to re-establish the momentum and recover the
ground that has been lost. I would ask shareholders for their patience while
these initiatives translate into results. Nonetheless, I am confident that,
given maximum effort by all who work in the Group, slowly but surely this is
what we can do.
John Hodson
Chairman
MILLER FISHER GROUP PLC
CONSOLIDATED PROFIT AND LOSS ACCOUNT restated
for the year ended 31 December 2001 unaudited audited
2001 2000
note £000 £000
Turnover: 2
Continuing operations 41,154 48,344
Discontinued operations 3,834 10,489
44,988 58,833
Operating costs:
Continuing operations 56,373 50,041
Discontinued operations 3,674 9,955
60,047 59,996
Operating (loss)/profit before exceptional expenses: and impairment of
goodwill
Continuing operations (5,073) 544
Discontinued operations 160 534
(4,913) 1,078
Exceptional expenses arising from continuing operations 3 (5,146) (2,241)
Impairment of goodwill 4 (5,000) -
Operating (loss)/profit: 2
Continuing operations (15,219) (1,697)
Discontinued operations 160 534
(15,059) (1,163)
Profit on disposal of subsidiary undertaking - discontinued 5 417 -
Loss on ordinary activities before interest and taxation (14,642) (1,163)
Net interest payable and similar items (2,152) (1,942)
Loss on ordinary activities before tax (16,794) (3,105)
Taxation on loss on ordinary activities 6 (677) (59)
Loss on ordinary activities after tax (17,471) (3,164)
Dividends paid and proposed 7 - (166)
Retained loss for the year (17,471) (3,330)
Basic loss per ordinary share (p) 8 (10.64) (1.95)
Diluted loss per share (p) (10.64) (1.95)
Loss per ordinary share before exceptional expenses 8 (4.71) (0.57)
and impairment of goodwill (p)
Dividends per share (p) 7 0 0.10
MILLER FISHER GROUP PLC
CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
for the year ended 31 December 2001
unaudited audited
2001 2000
note £000 £000
Loss for the year (17,471) (3,164)
Foreign exchange translation differences 165 (136)
taken to reserves
Total recognised gains and losses for the financial year (17,306) (3,300)
RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
for the year ended 31 December 2001
Loss for the financial year (17,471) (3,164)
Dividends 7 - (166)
Retained loss for the financial year (17,471) (3,330)
Issue of new shares 36 818
Foreign exchange translation differences 165 (136)
Net reduction to shareholders' funds (17,270) (2,648)
Opening shareholders' funds 23,652 26,300
Closing shareholders' funds 6,382 23,652
MILLER FISHER GROUP PLC
BALANCE SHEET AS AT 31 DECEMBER 2001
unaudited
proforma restated
with restructuring unaudited audited
2001 2001 2000
£000 £000 £000
Fixed assets
Intangible fixed assets - goodwill 26,545 26,545 31,584
Tangible fixed assets 4,978 4,978 5,393
Total fixed assets 31,523 31,523 36,977
Current assets
Work in progress 6,838 6,838 9,979
Debtors 9,512 9,512 15,034
Cash and bank balances 1,216 1,216 5,185
17,566 17,566 30,198
Creditors: amounts falling due within one year:
Borrowings (3,750) (26,303) (23,215)
Creditors (14,326) (14,326) (12,497)
(18,076) (40,629) (35,712)
Net current liabilities (510) (23,063) (5,514)
Creditors: amounts falling due aftermore than one year:
Borrowings (9,500) (197) (6,588)
Creditors (194) (194) (485)
(9,694) (391) (7,073)
Provisions (1,687) (1,687) (738)
NET ASSETS 19,632 6,382 23,652
Called up share capital 8,352 8,219 8,201
Share premium account 13,922 805 787
Other reserves 16,516 16,516 16,516
Profit and loss account (19,158) (19,158) (1,852)
Shareholders' funds 19,632 6,382 23,652
Equity shareholders' funds 6,382 6,382 23,652
Non-equity shareholders' funds 13,250 - -
19,632 6,382 23,652
Approved by the Board of Directors on
Malcolm Hughes
MILLER FISHER GROUP PLC
CONSOLIDATED CASH FLOW STATEMENT
for the year ended 31 December 2001
restated
unaudited audited
notes 31-Dec-01 31-Dec-00
£000 £000
Net cash inflow from operating activities 13 2,461 357
Returns on investment and servicing of finance (2,152) (1,968)
Taxation (269) (865)
Capital expenditure and financial investment (644) (1,710)
Acquisitions and disposals:
Deferred consideration paid (604) (1,492)
Proceeds of disposal of subsidiary undertaking 5 1,903
Cash balances of subsidiary at date of disposal (3,347)
(1,444) -
Equity dividends - (1,291)
Cash outflow before use of liquid resources and financing (2,652) (6,969)
Financing (535) (720)
Decrease in cash (3,187) (7,689)
Reconciliation of cash outflow to movement in net debt:
Decrease in cash for the year (3,187) (7,689)
Cash outflow from increase in debt and lease finance 571 720
Exchange movements - 1
Loan disposed of with subsidiary 2,250 -
New finance leases (300) -
Change in net debt resulting from cash flows (666) (6,968)
Net debt 1 January 12 (24,618) (17,650)
Net debt 31 December 12 (25,284) (24,618)
MILLER FISHER GROUP PLC
NOTES TO THE UNAUDITED CONSOLIDATED RESULTS
for the year ended 31 December 2001
1. Basis of accounting
The results for 2001 have been prepared in accordance with the accounting
policies of Miller Fisher Group plc as set out in its 2000 Annual Report and
Accounts.
On 8 March 2002, the Group concluded a restructuring of its finances, including
a bridging loan of £3.25m repayable in April 2003 and a £4m overdraft facility
renewable in March 2003, from which the Group meets its day to day working
capital requirements. As part of the restructuring the Group prepared cash flow
projections for the period ending 31 December 2003, which show that at certain
times these facilities are fully utilised. Although it is in the nature of the
Group's business that the timing of cash inflows can be unpredictable, on the
basis of the projections and discussions with the Group's bankers, who have
indicated that their current intention is to maintain the facilities in place
and have waived any breach of financial covenants for the quarter ended 31 March
2002, the directors have concluded that the Group will be able to operate within
the facilities currently agreed and within those they expect to be agreed in
March 2003, when the Group's bankers are due to consider renewing the working
capital facility for further year.
On this basis, the directors consider that it is appropriate that the financial
statements have been prepared on a going concern basis.
Insurance funds, including debtors and creditors, which were previously included
on the balance sheet, have now been excluded, so that the balance sheet does not
reflect what are essentially third party assets and liabilities. Work in
progress movements has been included in operating costs. Previously, it was
deducted from turnover. Prior year figures have been restated. There is no
impact on reported profit or shareholders' funds.
restated
unaudited unaudited unaudited audited audited audited
2001 2001 2001 2000 2000 2000
2. Segmental analysis Turnover Operating Net Turnover Operating Net
Profit Assets Profit Assets
£000 £000 £000 £000 £000 £000
Analysis by activity:
Claims management and 41,154 (5,073) 6,382 48,344 544 22,304
administration
Insurance 3,834 160 - 10,489 534 1,348
44,988 (4,913) 6,382 58,833 1,078 23,652
Exceptional expenses - (5,146) - - - -
Impairment of goodwill - (5,000) - - (2,241) -
44,988 (15,059) 6,382 58,833 (1,163) 23,652
The exceptional expenses and impairment of goodwill incurred in 2000 and 2001
related to the Claims management, administration, and inspection activity.
3. Exceptional expenses - continuing operations unaudited audited
31-Dec-01 31-Dec-00
£000 £000
These comprise:
Restructuring costs 2,070 -
Redundancy and reorganisation 763 607
Office relocation and temporary staff - 827
Development costs written off 274 274
Costs of vacant leasehold property 1,061 292
Other reorganisation costs 978 241
5,146 2,241
4. Impairment of goodwill
As required by FRS 10, an impairment review of goodwill was carried out. The
review was performed in accordance with FRS 11. The financial forecasts used
were consistent with those prepared for the financial restructuring (note 14). A
long term growth rate of 2.5% and a discount rate of 20% were applied.
5. Profit on disposal of subsidiary undertaking
On 8 May 2001 the Group disposed of Homecare Holdings Limited and its wholly
owned subsidiary Homecare Insurance Limited to CPP Holdings Limited. The profit
on disposal comprises the following:
£000
Net sale proceeds 1,903
Net assets disposed of (1,486)
Profit on sale 417
The above profit reflects attributable goodwill of £39,000.
6. Taxation
In view of the loss for the year, no provision for UK taxation is required. The
provision for tax in these financial statements relates to profits earned on the
Group's overseas operations, principally Ireland, and the writedown of certain
deferred tax assets.
7. Dividend
The Board does not recommend the payment of a final dividend (2000: nil). No
interim dividend was declared (2000: 0.10p per share).
8. Loss per share unaudited audited
31-Dec-01 31-Dec-00
The loss per ordinary share has been calculated as follows: £000 £000
Loss attributable to ordinary shareholders:
Before exceptional expenses (7,742) (923)
After exceptional expenses (17,471) (3,164)
Weighted average number of shares in issue 164,193,343 162,040,246
Adjusted weghted average number of shares in issue 164,221,358 163,313,563
The directors consider that a loss per share calculation that excludes the
impact of exceptional items and the impairment of goodwill provides a more
useful guide to underlying performance of the business and have therefore
prepared an adjusted earnings per share calculation. This can be reconciled to
the loss before exceptional expenses as follows:
Loss before exceptional expenses above (7,742) (923)
Exceptional expenses (5,146) (2,241)
Impairment of goodwill (5,000) -
Profit on disposal of subsidiary undertaking - discontinued 417 -
-
Loss after exceptional expenses (17,471) (3,164)
restated
9. Current assets unaudited audited
31-Dec- 31-Dec-00
01
£000 £000
Work in progress 6,838 9,979
Debtors 9,512 15,034
Bank balances 1,216 5,185
17,566 30,198
restated
10. Creditors: amounts falling due within one year unaudited audited
31-Dec-01 31-Dec-00
Borrowings 26,303 23,215
Trade creditors 2,362 2,258
Corporation tax 410 568
Other creditors and accruals 11,554 9,671
Total creditors falling due within one year 40,629 35,712
11. Creditors: amounts falling due after more than one year
Borrowings 197 6,588
Creditors 194 485
391 7,073
12. Net borrowings
Amounts falling due within one year:
Bank loans and overdrafts 25,924 22,637
Finance lease obligations 379 578
26,303 23,215
Amounts falling due after one year:
Bank loans and overdrafts - 6,320
Finance lease obligations 197 268
197 6,588
Total borrowings 26,500 29,803
Cash and liquid investments (1,216) (5,185)
Net borrowings at 31 December 25,284 24,618
13. Reconciliation of operating loss to net cash inflow from operating
activities
Operating loss before exceptional expenses and impairment of goodwill (4,913) 1,078
Exceptional expenses (5,146) (2,241)
(10,059) (1,163)
Depreciation of tangible fixed assets 1,312 1,198
Decrease/(increase) in work in progress 3,141 (660)
Decrease/(increase) in debtors 3,764 (451)
Increase in creditors and provisions 4,303 1,433
Net cash inflow from operating activities 2,461 357
14. Post balance sheet event
On 6 December 2001, the Group announced that it had reached agreement in
principle with the Bank of Scotland whereby Bank of Scotland would subscribe for
13.25 million Cumulative Redeemable Convertible Preference Shares, in
consideration for the capitalisation of £13.25 million of bank debt. The
restructuring also involved the refinancing of the existing Bank of Scotland
facilities, which were repayable on demand. The restructured facilities comprise
a £6.25m term loan, repayable over five years, a £3.25m bridging loan repayable
after 12 months, and a £4m working capital facility, repayable on demand.
Full details of the restructuring were contained in a Circular to shareholders
dated 8 February 2002. The necessary resolutions were passed by shareholders at
an EGM held on 4 March 2002 and the transaction was completed on 6 March 2002.
The proforma effect of the restructuring on the Group's balance sheet is shown
on the consolidated balance sheet included in this statement.
15. Abridged accounts
The financial information set out above does not constitute the Company's
statutory accounts for the years ending 31 December 2000 or 2001. The financial
information for 2000 is derived from the statutory accounts for that year which
have been delivered to the Registrar of Companies. The auditors have reported on
the 2000 accounts and their report was unqualified and did not contain a
statement under section 237(2) or (3) of the Companies Act 1985. The statutory
accounts for 2001 will be finalised on the basis of information presented in
this preliminary statement by the directors and will be delivered to the
Registrar of Companies following the Company's Annual General Meeting.
This information is provided by RNS
The company news service from the London Stock Exchange
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