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Share Name Share Symbol Market Type Share ISIN Share Description
Mountfield Group Plc LSE:MOGP London Ordinary Share GB00B3CQW227 ORD 0.1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.0% 0.32 0.30 0.32 0.00 01:00:00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Construction & Materials 21.0 0.8 0.3 1.2 1

Mountfield Group plc Half-year Report

09/10/2020 12:10pm

UK Regulatory (RNS & others)


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Mountfield Group plc

09 October 2020

9 October 2020

M o untfield Group Plc

Ha lf-y e arly report to 30 June 2020

Mountfield Group Plc ("the Group"), the AIM quoted commercial flooring and specialist construction services company announces its unaudited half-yearly report to 30 June 2020 ("the Period").

   --           Net profit before tax for the first half of the year was GBP81k (2019: GBP719k). 
   --           Turnover decreased from GBP9.14m to GBP5.82m over the corresponding period. 

-- The Board therefore anticipates that there will be a substantial reduction in turnover and net profit for the full 2020 calendar year.

The value of the Group's secured order book is, at GBP4.98m, lower than it was at the same point last year.

Peter Jay (Non-Executive Chairman) and Andy Collins (Group CEO) said:

"We are disappointed to report that the Group's performance and profitability that had improved substantially over the last few years have deteriorated significantly in the current year. Turnover and net profit for the Period are substantially lower than those achieved in the corresponding periods of the previous two years.

The substantial deterioration in performance was caused primarily by the contraction in demand for construction services caused by the COVID-19 pandemic. At this relatively early stage it is not possible to determine whether the contraction is a temporary phenomenon or whether its effect will continue to be felt over the longer term.

The Group's Executive Directors are continually monitoring the market to ensure that the Group will be in a position to react quickly to any changes and opportunities as they arise."

The information contained within this announcement is deemed by the Company to constitute inside information under the Market Abuse Regulation (EU) No. 596/2014.

 
M o untfield Group Plc 
 P eter Jay, C hair man 
 Andy Collins, C hief E xecutive 
 Of ficer                            +44 ( 0 )1 2 68 5 61 516 
 
  Cairn Financial Advisers LLP 
  Jo Turner/Sandy Jamieson           +44 ( 0 )20 72 13 0880 
 

M o untfield Group Plc (the "Co mpany" or "the Group") Half-y e arly report to 30 June 2020

Connaught Access Flooring Limited ("CAF")

In the first six months of the year turnover was GBP3.1m (2019 - GBP3.9m) and the underlying profit before tax was GBP71k (2019 - GBP502k).

The majority of the projects that CAF has undertaken during the period were secured prior to the onset of the COVID-19 pandemic. CAF has continued to deliver these contracts, whilst complying with the Government's imposed guidelines, however, this has generally resulted in longer programme durations. Whilst tender activity has remained reasonably strong, the number of new projects start-ups (the majority of which continue to be in commercial office space in the City of London and Canary Wharf) has slowed considerably.

Mountfield Building Group Limited ("MBG")

In the first six months of the year turnover was GBP2.7m (2019 - GBP5.2m) and the underlying profit before tax was GBP138k (2019 - GBP355k).

The demand for MBG services have dropped considerably over the first half of this year, due primarily to the effects of COVID-19, and our IT clients reluctance to have works carried out in their sites where their network is currently at high demand. They are therefore only considering non-risk and essential engineering works currently on their sites. We are not aware how long this situation will remain, but would anticipate no increased demand for our services will be required, until well into the middle of next year.

Group and outlook

Even though the results for the last full financial year resulted in a further improvement in the working capital position of the Group which assisted it when dealing with the impact of COVID-19 and its consequent effect on the economy the Group has been challenged by the need to adjust to the dramatically reduced demand for its services.

The Group's current secured order book is GBP4.98m, mainly comprised of contracts which will be completed in 2020. This figure is substantially lower than at the same point last year. The Board does not expect that a substantial amount of new turnover will be won and delivered by this year end and that the result will be a significant drop in the Group's performance for 2020 as compared to that in 2019.

The Board believes that as regards future prospects, the changes resulting from the COVID-19 epidemic may be of a fundamental nature and that these changes are likely to have a long term and materially negative impact on the markets in which the Group companies operate.

The sharp recession that resulted from the steps taken to limit the spread of the virus has impacted the construction business generally, having had a significant, negative effect on the demand for construction services and in activity levels in the industry generally. The Group has also suffered because both Group companies offer specialist services to small segments of their respective markets.

Whilst the current drop in the UK's GDP is expected to be reversible in the medium to long term, the changes in working practices caused by the virus are likely to result in major changes in the overall demand for construction services and particularly for those services provided by the Group companies. The increasing extent to which companies will rely upon home-based workers has and will continue to reduce demand for city centre located office space and, in turn, for the flooring of large new or refurbished office premises within the City or in neighbouring areas.

In the light of the above, the Group companies are taking a cautious approach to securing their current and mid-term turnover targets and will concentrate on servicing the requirements of core clients on contracts which are neither onerous nor carry a significant risk element. The Board acknowledges that this policy will impact of turnover and net profit but believe that it is necessary and appropriate in order to protect the Group and the interests of shareholders in a period of unprecedented levels of uncertainty and risk.

The Board is continuing to monitor the changing market conditions and seek new contracts in the areas of construction that fall within the current specialisations of the Group companies.

Condensed consolidated statement of comprehensive income

For the six months ended 30 June 2020

 
                                                     6 months to 30 June 2020     6 months to        12 months to 
                                                                                 30 June 2019    31 December 2019 
                                                                  (unaudited)     (unaudited)           (audited) 
                                              Note                        GBP             GBP                 GBP 
 Revenue                                                            5,823,166       9,137,192          20,989,052 
 Cost of sales                                                    (4,991,963)     (7,572,698)        (18,802,737) 
                                                    -------------------------  --------------  ------------------ 
 Gross profit                                                         831,203       1,564,494           2,186,315 
 Administrative expenses                                            (746,236)       (843,172)         (1,335,464) 
                                                    -------------------------  --------------  ------------------ 
 Operating profit                                                      84,967         721,322             850,851 
 Net finance costs                                                    (4,362)         (2,266)            (10,111) 
                                                    -------------------------  --------------  ------------------ 
 Profit before income tax                                              80,605         719,056             840,740 
 Income tax expense                            3                     (19,515)       (160,469)           (174,727) 
                                                    -------------------------  --------------  ------------------ 
 
 Total comprehensive profit for the period                             61,090         558,587             666,013 
                                                    =========================  ==============  ================== 
 
 Earnings per share                              4 
 
 Basic & diluted                                                       0.024p          0.220p              0.262p 
 
 
 

There are no recognised gains and losses other than those passing through the Statement of Comprehensive Income

Condensed consolidated statement of financial position

As at 30 June 2020

 
                                        30 June 2020   30 June 2019   31 December 2019 
                                         (Unaudited)    (Unaudited)          (audited) 
                                                 GBP            GBP                GBP 
 ASSETS 
 Non-current assets 
 Intangible assets                         6,874,308      6,874,308          6,874,308 
 Property, plant and equipment               111,365        145,387            101,601 
 Right-of-use assets                           2,583              -             18,083 
                                       -------------  -------------  ----------------- 
                                           6,988,256      7,019,695          6,993,992 
                                       -------------  -------------  ----------------- 
 Current assets 
 Inventories                                 145,891        126,469            147,033 
 Trade and other receivables               3,004,533      5,292,106          3,543,322 
 Cash and cash equivalents                   504,460        612,451            802,885 
                                           3,654,884      6,031,026          4,493,240 
                                       -------------  -------------  ----------------- 
 TOTAL ASSETS                             10,643,140     13,050,721         11,487,232 
                                       =============  =============  ================= 
 
 EQUITY AND LIABILITIES 
 Share capital and reserves 
 Issued share capital                      2,524,426      2,524,426          2,524,426 
 Share premium                             1,490,682      1,490,682          1,490,682 
 Capital redemption reserve                    7,500          7,500              7,500 
 Merger reserve                            4,051,967      4,051,967          4,051,967 
 Reverse acquisition reserve             (2,856,756)    (2,856,756)        (2,856,756) 
 Retained earnings                         1,544,735      1,376,219          1,483,645 
                                       -------------  -------------  ----------------- 
 TOTAL EQUITY                              6,762,554      6,594,038          6,701,464 
                                       -------------  -------------  ----------------- 
 
 Current liabilities 
 Trade and other payables                  3,134,972      5,517,202          4,199,058 
 Short-term borrowings                       472,095        489,590            297,199 
 Lease liabilities                             2,583              -             18,083 
 Current tax payable                         200,936        388,885            181,428 
                                       -------------  -------------  ----------------- 
                                           3,810,586      6,395,677          4,695,768 
 Non-current liabilities 
 Loan notes                                   70,000         61,006             90,000 
 TOTAL LIABILITES                          3,880,586      6,456,683          4,785,768 
                                       -------------  -------------  ----------------- 
 
 TOTAL EQUITY & LIABILITIES               10,643,140     13,050,721         11,487,232 
                                       =============  =============  ================= 
 
 

Co ndens ed cons olidated s tat e m ent of changes in equity

Fo r the six m onths ended 30 June 2020

 
                 Sh ar e ca p   Sh ar e p re m     Capital     R e v er se A    M e r ge r    R e t ai n ed  To t a l 
                    i t al           i um        redemption     c qu isi ti     rese r ve     ear n i ng s 
                                                   reserve     on rese r ve 
                      GBP            GBP             GBP            GBP            GBP             GBP          GBP 
B a la n c e 
 at 1 J a nu a 
 ry 2019          2,524,426       1,490,682         7,500       (2,856,756)     4,051,967        817,632     6,035,451 
T o ta l c omp 
 r e h e nsi 
 ve i nc ome          -               -               -              -              -            558,587      558,587 
                --------------  --------------  -------------  -------------  --------------  -------------  --------- 
B a la n c e 
 at 30 J une 
 2019             2,524,426       1,490,682         7,500       (2,856,756)     4,051,967       1,376,219    6,594,038 
                --------------  --------------  -------------  -------------  --------------  -------------  --------- 
B a la n c e 
 at 1 J uly 
 2019             2,524,426       1,490,682         7,500       (2,856,756)     4,051,967       1,376,219    6,594,038 
T o ta l c omp 
 r e h e nsi 
 ve income            -               -               -              -              -            107,426      107,426 
                --------------  --------------  -------------  -------------  --------------  -------------  --------- 
B a la n c e 
 at 31 D e ce 
 m b er 2019      2,524,426       1,490,682         7,500       (2,856,756)     4,051,967       1,483,645    6,701,464 
                --------------  --------------  -------------  -------------  --------------  -------------  --------- 
B a la n c e 
 at 1 J a nu a 
 ry 2020          2,524,426       1,490,682         7,500       (2,856,756)     4,051,967       1,483,645    6,701,464 
T o ta l c omp 
 r e h e nsi 
 ve income            -               -               -              -              -            61,090       61,090 
                --------------  --------------  -------------  -------------  --------------  -------------  --------- 
B a la n c e 
 at 30 J une 
 2020             2,524,426       1,490,682         7,500       (2,856,756)     4,051,967       1,544,735    6,762,554 
                --------------  --------------  -------------  -------------  --------------  -------------  --------- 
 

Condensed consolidated cash flow statement

For the six months ended 30 June 2020

 
                                                                                                                     6 months to      6 months       12 months 
                                                                                                                                          to             to 
                                                                                                                     30 June 2020    30 June 2019    31 December 
                                                                                                                                                         2019 
                                                                                                                     (unaudited)     (unaudited)      (audited) 
                                                                                                                         GBP             GBP            GBP 
 Cash from operating activities: 
 Operating profit                                                                                                          84,967         721,322        850,851 
 Adjusted for: 
 Depreciation                                                                                                              23,930          22,475         44,611 
 Profit on disposal                                                                                                         (600)               -              - 
 (Increase)/ decrease in inventories                                                                                        1,142        (11,167)       (31,731) 
 (Increase)/ decrease in trade 
  and other receivables                                                                                                   538,791     (2,881,044)    (1,132,254) 
 (Decrease)/ increase in trade 
  and other payables                                                                                                  (1,122,555)       2,195,803        777,976 
                                                                                                                   --------------  --------------  ------------- 
 Cash (used in)/ generated by 
  operations                                                                                                            (474,325)          47,389        509,453 
 
 Finance costs                                                                                                            (4,362)         (1,984)       (10,111) 
 Taxation paid                                                                                                                  -               -      (223,088) 
                                                                                          Net cash 
                                                                                           (outflow)/inflow from 
                                                                                           operating activities         (478,687)          45,405        276,254 
                                                                                                                   --------------  --------------  ------------- 
 
 Cash flows from investing activities 
 Purchase of equipment                                                                                                   (18,195)        (16,126)       (12,557) 
 Proceeds from sale of property,                                                                                              600               -              - 
  plant and equipment 
                                                                                          Net cash flows from / 
                                                                                           (used) 
                                                                                           in investing 
                                                                                           activities                   (496,282)          29,279        263,697 
                                                                                                                   --------------  --------------  ------------- 
 
 Cash flows from financing activities: 
 
 Lease repayments                                                                                                        (15,500)        (15,498)       (31,000) 
 Repayment of non-convertible 
  loan notes                                                                                                             (27,961)        (18,000)       (36,001) 
 Movement of supplier financing                                                                                           241,318               -              - 
  facility 
 Repayment of short-term loans                                                                                                  -        (61,077)       (71,558) 
                                                                                                                   --------------  --------------  ------------- 
 
   Net cash flows from financing 
   activities                                                                                                             197,857        (94,575)      (138,559) 
                                                                                                                   ==============  ==============  ============= 
 
   Net (decrease)/increase in cash 
   and cash equivalents                                                                                                 (298,425)        (65,296)        125,138 
 
 Cash and cash equivalents brought 
  forward                                                                                                                 802,885         677,747        677,747 
                                                                                                                   --------------  --------------  ------------- 
 
   Cash and cash equivalents carried 
   forward                                                                                                                504,460         612,451        802,885 
                                                                                                                   ==============  ==============  ============= 
 

For the purposes of the cash flow statement, cash and cash equivalents comprise the following:

 
                             As at 30 June    As at 30    As at 31 December 
                                  2020        June 2019          2019 
                                  GBP           GBP              GBP 
 Cash at bank and in hand          504,460      612,451             802,885 
 Bank overdraft                          -            -                   - 
 
                                   504,460      612,451             802,885 
                            ==============  ===========  ================== 
 
   1 .     Notes  to the  Interim Report 

B a s is of preparation

The Group's half-yearly financial statements for the six months ended 30 June 2020 were authorised for issue by the directors on 9 October 2020.

T h e co ns olidated half-yearly fin a ncial state men t s, w hich are u nau dited, do n ot con stit ute s tatuto ry accou n ts wit h in t he meaning of Section 434 of t he C o m p a nies Act 2006. T he statuto ry accou nts f or t he year en ded 31 Dece m ber 2019 have been filed with t he Regis t rar of Co m panies at C o m panies Hou se. T he au dit report on t he statuto ry accou n ts f or the year en ded 31 Dece m ber 2019 was u n q ualified and did n ot co ntain a ny state men ts un der Section 498 (2) or ( 3) of the C o m panies Act 2006.

T h e annu al f i n a ncial state m e nts of Mou n t field Gro up Plc f or the year en ded 31 Decem ber 20 20 w ill be prepar ed in accordance w ith I nter natio n al Fi nancial Reporting Sta n dards as adopted f or use in t he EU ( " I F RS"). Accordin g l y, these inter im f i nan cial state ments h a ve been prepared us i ng accou nti ng policies con siste nt with t h o se w hich will be adopted by t he Gro up in t he f i nancial state m e nts a nd in co m pliance with IAS 34 " I nter im finan cial reporting".

T h e co ns olidated inter im f i n a ncial state men ts have been prepared in accordance w ith the acco unti ng policies set o ut in the ann ual fin a ncial state men ts f or the year en ded 31 Decem ber 2 0 19.

B a s is of cons olidation

T h e Gro up finan cial in f o r m ati on co ns olidates t hat of t he co m p a ny and its s u b sidiaries.

A ll i ntr a - g r o up transactio ns, balances, i nco me a nd ex pen ses are eli m i nated on co ns olidatio n.

   2.    Seg m ental reporting 

Seg ment in f o r mation is presented in res pect of the Group 's b us i ness s e g m e n t s, w hich are based on the Gro u p 's man a g e m e nt and i nter nal reporting str uct u re.

The chief operating decision-maker has been identified as the Board of Directors (the Board). The Board reviews the Group's internal reporting in order to assess performance and allocate resources. Management have determined the operating segments based on these reports and on the internal report's structure.

Segment performance is evaluated by the Board based on revenue and profit before tax ("PBT"). Segment results include items directly attributable to a segment as well as those that can be allocated on a reasonable basis, such as centrally managed costs relating to individual segments and costs relating to land used in more than one individual segment.

Given that income taxes and certain corporate costs are managed on a centralised basis, these items are not allocated between operating segments for the purposes of the information presented to the Board and are accordingly omitted from the analysis below.

The Group comprises the following segments:

Construction

Direct contracting and trade contracting services to both main contractors and corporate end users.

Fit-out

Providing raised flooring systems to both main contractors and corporate end users.

Segmental operating performance

 
                              Six months to 30        Six months to       Twelve months to 
                                  June 2020            30 June 2019        31 December 2019 
                             Segmental       PBT   Segmental       PBT   Segmental       PBT 
                               revenue               revenue               revenue 
                               GBP'000   GBP'000     GBP'000   GBP'000     GBP'000   GBP'000 
                            ----------  --------                        ----------  -------- 
 Construction                    2,743       138       5,216       355      13,223       117 
 
 Fit -out                        3,080        71       3,921       502       7,766       724 
 
                                 5,823       209       9,137       857      20,989       841 
 Inter-segmental 
  revenue and unallocated 
  costs                                    (128)           -     (138)           -         - 
                            ----------  --------  ----------  --------  ----------  -------- 
                                 5,823        81       9,137       719      20,989       841 
                            ==========  ========  ==========  ========  ==========  ======== 
 

Business segments assets and liabilities

 
                                Six months to            Six months to            Twelve months 
                                 30 June 2020             30 June 2019            to 31 December 
                                                                                       2019 
                            Segment        Segment   Segment        Segment   Segment        Segment 
                             assets    liabilities    assets    liabilities    assets    liabilities 
                            GBP'000        GBP'000   GBP'000        GBP'000   GBP'000        GBP'000 
                           --------  ------------- 
 Construction                 1,794          2,246     2,481          3,810     1,999          2,582 
 
 Fit-out                      2,636          1,167     3,665          2,103     3,203          1,763 
 
                              4,430          3,413     6,146          5,913     5,202          4,345 
 
 Goodwill - Construction      2,000              -     2,000              -     2,000              - 
 Goodwill - Fit-out           4,874              -     4,874              -     4,874              - 
 Other unallocated 
  assets & liabilities           17          1,145        30            543         1          1,031 
                             11,321          4,558    13,050          6,456    12,077          5,376 
                           ========  =============  ========  =============  ========  ============= 
 

Unallocated assets consist of deferred tax, trade and other receivables and cash held by the Parent Company. Unallocated liabilities consist of trade and other payables and interest-bearing loans owed by the Parent Company.

Revenue by geographical des tination

Revenue is attributable to the United Kingdom and other EU markets. T o tal assets incl u ding proper t y, plant and eq uip m e nt and i n tangible a ssets are all held in t he UK.

   3.     Income tax (expense)/credit (continuing operations) 
 
                                    6 months      6 months     12 months to 
                                    to 30 June    to 30 June    31 December 
                                       2020          2019          2019 
                                   (unaudited)   (unaudited)    (audited) 
                                       GBP           GBP           GBP 
 Current tax on income for the 
  period                              (19,515)     (160,469)      (174,727) 
 Deferred tax (expense)                      -             -              - 
                                  ------------  ------------  ------------- 
 Income tax (expense)/credit in 
  the income statement                (19,515)     (160,469)      (174,727) 
                                  ============  ============  ============= 
 
   4.    Earnings per share 

The basic earnings per share is calculated by dividing the earnings attributable to equity shareholders by the weighted average number of shares in issue. In calculating the diluted earnings per share, share options outstanding have been taken into account where the impact of these is dilutive.

The weighted average number of shares in the period was:

 
                                    6 months      6 months     12 months to 
                                    to 30 June    to 30 June    31 December 
                                       2020          2019          2019 
                                   (unaudited)   (unaudited)    (audited) 
 
                                     Number        Number         Number 
 
 B asic ordinary shares of 0.1p 
  each                             254,244,454   254,244,454    254,244,454 
 Diluti ve ordinary shares f r               -             -              - 
  om warran ts & optio ns 
                                  ------------  ------------  ------------- 
 
 Total diluted                     254,244,454   254,244,454    254,244,454 
                                  ------------  ------------  ------------- 
 

Earning attributable to equity shareholders of the parent

 
                                6 months       6 months      12 months to 
                                to 30 June         to         31 December 
                                   2020       30 June 2019       2019 
                               (unaudited)    (unaudited)     (audited) 
                                   GBP            GBP            GBP 
 Continuing operations 
 Basic earnings per share           0.024p          0.220p         0.262p 
 Diluted earnings per share         0.024p          0.220p         0.262p 
                              ------------  --------------  ------------- 
 

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END

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