Share Name Share Symbol Market Type Share ISIN Share Description
Northamber Plc LSE:NAR London Ordinary Share GB00B2Q99X01 ORD 1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.0% 73.00 71.00 75.00 73.00 73.00 73.00 10,552 08:00:00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Technology Hardware & Equipment 52.8 9.9 31.2 2.3 21

Northamber PLC Final Results

29/01/2021 5:05pm

UK Regulatory (RNS & others)

Northamber (LSE:NAR)
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From Jan 2021 to Apr 2021

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RNS Number : 4356N

Northamber PLC

29 January 2021

29 January 2021

Northamber PLC

(the "Company" or the "Group")

Preliminary Results for the year ended 30 June 2020

Chairman's Statement


It has been a challenging year for many of us driven by significant changes and challenges on Demand and Supply due to Covid-19 and the uncertainty it created. We took the early decision to keep true to our core values and prioritise looking after our team and partners for as long as we could by avoiding any furlough or Covid-19 related redundancy across the Group. By staying fully staffed and operational we believed we could better support all our stakeholders throughout lockdown - the hope was that this would also allow us to gain long term market share. We are pleased to advise that this decision to keep fully resourced, combined with our nimble structure, rewarded us with modest organic sales growth but significant margin growth year on year as we picked up opportunities from our major competitors.

The year has also been one of deliberate change, which began with the sale of the Weybridge distribution centre in July 2019 for cash consideration of GBP16.4 million. We leased the site whilst looking for a new permanent home for our distribution centre which we found in Swindon, purchasing the site in December 2019 for GBP3.4 million. By surrendering the lease of the Weybridge warehouse within 12 months we realised additional consideration of GBP0.6 million. We are very pleased to have moved into the Swindon warehouse from the Weybridge site during the second half of the financial year. Despite the pandemic, we managed to ensure that there was no customer disruption by simultaneously operating from the two sites, although this resulted in dual running costs of the sites.

Another significant event was the acquisition in February of Audio Visual Materials Limited ("AVM") for GBP2.14 million which reaffirms our commitment to investing in technical, value add distribution which offers more attractive margins. AVM now benefits from the Group's back end infrastructure but is operated as a largely standalone business as we sought to protect its core focus. We are pleased to advise that despite AVM's sector experiencing a very heavy Covid-19 contraction, that negatively impacted AVM's sales and profitability, the Group has not made any redundancies at AVM whether due to Covid-19, integration or any other reason and indeed has continued to invest to ensure AVM prospers in the longer term including building its presence in future key technologies. The Group is excited for the future with AVM and expects to see a strong recovery from AVM in a post Covid-19 world.

Following the AVM acquisition, the Group purchased an office for GBP1.5 million to house the AVM team near to its previous location. This provided an immediate rent saving for AVM, additional office space for the Group to expand our sales team in a strong catchment area and came with an incumbent sub-tenant which served to further reduce the operating cost of the office.

Turning to our financial results, across the Group, like-for-like revenue increased by 2.1% year on year with total Group revenue increasing by 5% from GBP50.3 million to GBP52.8 million, including the contribution from AVM, despite very challenging conditions for many of our focus suppliers within Pro AV, Infrastructure and large Document Management where many sales were delayed due to restricted site access for installation due to lockdown. An increased demand for IT equipment to facilitate home working meant that there was a limited overall impact on sales during the lockdown period.

Our continued investment and focus on these more technical, higher margin categories, coupled with an early move to support partners with remote working deployments, was rewarded as gross margins in our core business increased significantly from 8.60% to 10.03%. Market declines in some of our core categories however meant that we missed out on volume achievement rebates with some suppliers with rebates down significantly year on year; we would expect these to return in the future however as the market recovers in these impacted segments. AVM enjoys significantly higher gross margins of around 20% and we anticipate that the Group's gross margins will further improve from a change in sales mix post Covid-19.

Overall, Gross Profit increased from GBP4.33 million to GBP5.48 million which is a 26.5% increase year on year. Revenue and margin growth has been supported by growth from some of our strategic focus areas, together with the addition of higher margin revenues from AVM, as well as some tactical gains in supporting remote working deployments; we would have expected more significant revenue growth if not for lockdowns restricting access to site.

The corporate activity undertaken during the year inevitably led to the Group incurring some, non-recurring costs such as warehouse duplication and restructuring costs following the move from Weybridge to Swindon which have impacted the results for the year but which won't be repeated in the following financial year. Due to the extra costs associated with operating the AVM business, the investment in our sales capabilities and supporting the planned continued growth in Gross Profit our distribution costs increased year on year from GBP2.85 million to GBP3.60 million and administrative costs increased from GBP2.35 million to GBP2.61 million. Costs remain closely monitored however and as ever this is a key focus area for the business and our Board.

Similarly, the GBP9.93 million pre-tax profit for the Group (GBP0.60 million loss prior year) after exceptional income from the Warehouse sale would have been stronger but for the non-recurring costs mentioned above.

The Board are very proud of how the team pulled together in this tough year to help our community, some specific examples include working with customers & suppliers to quickly prioritise supporting the NHS including Nightingale efforts, offering warehousing free of charge to the local NHS Trust, supporting Clap for our Carers by providing resources from AVM for illuminating local churches, sourcing products globally that were constrained in the UK to support remote working all whilst rolling out remote working for our entire office based team.

Financial position

Maintaining our prudence in financial matters, our working capital management is reflected in the Net Current Assets ratio which at 4.7 times (2019: 2.5 times) is a significant improvement.

Stock levels are higher than last year at GBP5.9 million vs GBP3.3 million, in part due to the AVM acquisition and also as we continued to seek to profitably support our partners by maintaining sufficient stock in country during the uncertainty of logistics due to Covid-19 as supply chains were creaking. We see our flexibility on local stock levels as a key driver of our future with our partners.

Cash was GBP10.96 million at 30 June 2020 compared with GBP3.4 million at 30 June 2019, reflecting the sale of the distribution centre and the purchase of the new warehouse property, AVM and a new office. With Fixed Assets at book value at GBP7.2 million, including three unencumbered freehold properties, the Group's' overall financial position is very sound.

Net Assets at 91.5p per share are considerably in excess of the average price of the ordinary shares throughout the period.


With great sadness, we lost our founder and Chairman David Phillips in December 2019. David made a very significant contribution to the development and leadership of the Company since he founded Northamber in 1980 and he will be greatly missed.

Alex Phillips, who is the son of David Phillips, joined the board in February and was appointed Managing Director of the Group in August having formerly been the Commercial Director, whilst Colin Thompson was appointed Chairman in October.


As in previous years, your Board has had regard to the strength of our debt free, tangible asset strong balance sheet and is proposing the final dividend be 0.3p, at a total cost of GBP81,695. The dividend will be paid on 18 March 2021 to shareholders on the register as at 12 February 2021.


Our staff have been the differentiator in our business for decades and we are pleased that we were able to work side by side with them throughout this unprecedented period and offer them continued job security. We remain incredibly grateful to them and continue to invest in our evolving business model with added skills based services and which are heavily reliant on our staff to achieve our business evolution. The quality of our team is evident in delivering these growth figures whilst working remotely, moving logistics centre and supporting our partners in a tough period with unpredictable demand.


We are pleased to advise that we have been trading well so far since the start of the new financial year and we are quietly optimistic that the investments we have made in supporting our partners coupled with removing the one off costs tied to moving warehouse should be reflected in the trading results for the current financial year. Clearly we remain highly cautious however due to the economic uncertainty, Brexit and the potential further impact of Covid-19 on the demand and supply chain. We remain committed to our continued focus on our strategic, higher margin value categories and we see future opportunities to grow our market share. The strength of our balance sheet provides an excellent platform from which to do so, and inspires confidence in our customers and suppliers that Northamber is here for the long haul.



29 January 2021


 Northamber PLC              Tel: +44 (0) 208 744 8200 
   Colin Thompson, Chairman 
 N+1 Singer (Nominated Adviser and   Tel: +44 (0) 207 496 
  Sole Broker)                        3000 
 Philip Davies (Corporate Finance) 
  Alex Bond (Corporate Finance) 
 For the year ended 30 June 2020 
                                                       2020         2019 
                                           Notes      GBP'000      GBP'000 
 Revenue                                     2         52,835       50,329 
 Cost of sales                                       (47,357)     (45,998) 
 Gross Profit                                           5,478        4,331 
 Distribution costs                                   (3,601)      (2,849) 
 Administrative costs                                 (2,613)      (2,352) 
 Administrative costs - Exceptional 
  acquisition costs                                     (220)            - 
 Other income - Exceptional gain                       10,804            - 
  on disposal of property 
                                                  -----------  ----------- 
 Profit/(loss) from operations                          9,848        (870) 
 Adjusted operating loss                                (736)        (870) 
  Exceptional items                                    10,584            - 
                                                  -----------  ----------- 
 Operating profit/(loss)                                9,848        (870) 
----------------------------------------  ------  -----------  ----------- 
 Investment revenue                                        92          272 
 Finance cost                                            (15)            - 
                                                  -----------  ----------- 
 Profit/(loss) before tax                               9,925        (598) 
 Tax charge                                           (1,413)            - 
 Profit/(loss) for the year and 
  total comprehensive loss attributable 
  to the owners                                         8,512        (598) 
                                                  ===========  =========== 
 Basic and diluted profit/ (loss) 
  per ordinary share                         3         31.16p      (2.17)p 
 At 30 June 2020 
                                            2020         2019 
                                           GBP'000      GBP'000 
 Non current assets 
 Property, plant and equipment               7,184        1,792 
 Goodwill and intangible assets              1,421            - 
                                       -----------  ----------- 
                                             8,605        1,792 
                                       -----------  ----------- 
 Current assets 
 Inventories                                 5,948        3,320 
 Trade and other receivables                 7,750        9,492 
 Cash and cash equivalents                  10,968        3,446 
 Assets classified as held for 
  sale                                           -        6,019 
                                       -----------  ----------- 
                                            24,666       22,277 
                                       -----------  ----------- 
 Total assets                               33,271       24,069 
                                       ===========  =========== 
 Current liabilities 
 Trade and other payables                  (8,356)      (7,434) 
 Total liabilities                         (8,356)      (7,434) 
                                       -----------  ----------- 
 Net assets                                 24,915       16,635 
                                       ===========  =========== 
 Share capital                                 272          273 
 Share premium account                       5,734        5,734 
 Capital redemption reserve                  1,514        1,513 
 Treasury Shares                                 -          (7) 
 Retained earnings                          17,395        9,122 
                                       -----------  ----------- 
 Equity shareholders' funds                 24,915       16,635 
                                       ===========  =========== 
 At 30 June 2020 
                                          Share          Share      Capital Redemption     Treasury   Retained         Total 
                                         Capital        Premium          Reserve            shares    Earnings         Equity 
                                         GBP'000        GBP'000           GBP'000          GBP'000    GBP'000         GBP'000 
 Balance at 1 July 2019                      281         5,734             1,505                  -    10,000          17,520 
 Dividends                                     -           -                 -                    -     (55)            (55) 
 Purchase and cancellation of shares         (8)                             8                    -    (225)           (225) 
  Purchase of treasury shares                  -                                                (7)       -              (7) 
                                        --------       --------          --------         ---------  ---------       --------- 
 Transactions with owners                    (8)              -              8                  (7)    (280)           (287) 
 Loss and total comprehensive loss for 
  the year                                     -              -              -                    -    (598)           (598) 
 Balance at 30 June 2019                     273         5,734             1,513                (7)    9,122           16,635 
 Dividends                                     -              -              -                    -    (164)           (164) 
 Purchase and cancellation of shares         (1)                             1                    -     (68)            (68) 
 Purchase of treasury shares                   -              -              -                    7     (7)                  - 
 Transactions with owners                    (1)              -              1                    7    (239)           (232) 
 Profit and total comprehensive Profit 
  for the year                                 -              -              -                    -    8,512           8,512 
 Balance at 30 June 2020                     272         5,734             1,514                  -    17,395          24,915 
                                        ========       ========          ========         =========  =========       ========= 
 For the year ended 30 June 2020 
                                                                2020                2019 
                                                               GBP'000             GBP'000 
 Cash flows from operating activities 
 Operating (loss) from continuing operations                      9,848               (870) 
 Depreciation of property, plant and equipment                      228                 153 
 Profit on disposal of property                                (10,982)                   - 
                                                          -------------       ------------- 
 Operating (loss) before changes in working 
  capital                                                         (906)               (717) 
 (Increase)/decrease in inventories                             (2,039)                  58 
 Decrease/(increase) in trade 
  and other receivables                                           2,899             (1,346) 
 (Decrease)/increase in trade 
  and other payables                                            (1,172)                 470 
 Cash generated from operations                                 (1,218)             (1,535) 
 Income taxes paid                                                    -                   - 
 Net cash from operating activities                             (1,218)              (1535) 
                                                          -------------       ------------- 
 Cash flows from investing activities 
 Interest received                                                   92                 272 
  Interest paid                                                    (15)                   - 
 Proceeds from disposal of property                              16,400                   - 
 Purchase of property, plant and 
  equipment                                                     (5,370)                (71) 
  Purchase of AVM Limited                                       (2,135)                   - 
 Net cash from investing activities                               8,972                 201 
 Cash flows from financing activities 
 Dividends paid to equity shareholders                            (164)                (55) 
 Purchase of cancellation of shares                                (68)               (225) 
 Purchase of treasury shares                                          -                 (7) 
 Net cash used in financing activities                            (232)               (287) 
                                                          -------------       ------------- 
 Net increase in cash and cash 
  equivalents                                                    7,522              (1,621) 
 Cash and cash equivalents at 
  beginning of year                                               3.446               5,067 
 Cash and cash equivalents at 
  end of year                                                    10,968               3,446 
                                                          -------------       ------------- 


1. Financial information

This financial information is consistent with the consolidated financial statements of the group for the year ended 30 June 2020. The group's consolidated financial statements have been prepared in accordance with International Financial Reporting Standards as adopted by the EU.

The financial information set out above does not constitute the group's statutory accounts for the years ended 30 June 2019 or 30 June 2020, but is derived from those accounts. The statutory accounts for the year ended 30 June 2019 have been delivered to the Registrar of Companies and those for 2020 will be delivered following the group's annual general meeting. The auditors have reported on these accounts, their reports were unqualified, did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their reports, and did not contain statements under s.498(2) or (3) of the Companies Act 2006. The information contained in this statement does not constitute statutory accounts within the meaning of section 434 of the Companies Act 2006.

2. Revenue

Although the sales of the group are predominantly to the UK there are sales to other countries and the following table sets out the split of the sales for the year. Revenue is attributable to individual countries based on the location of the customer. There are no non current assets outside the UK.

 Revenues comprise:           2020       2019 
                             GBP'000   GBP'000 
 Revenue from contracts 
  customers - UK              52,391    49,655 
                 -other         444         674 
                            --------  --------- 
                             52,835     50,329 
                            --------  --------- 

One customer accounted for more than 10% of the group's revenue for the year, being GBP5,900,000 (2019: GBP6,400,000).

3. Profit /Loss) per ordinary share

The calculation of the basic and diluted earnings per share is based on the following data:

                                                   2020         2019 
                                                  GBP'000      GBP'000 
 Profit/(Loss) for the year attributable 
 to equity holders of the parent company            8,512        (598) 
                                              ===========  =========== 
                                                  2020         2019 
 Number of shares                               Number       Number 
  Weighted average number of ordinary 
   shares for the purpose of basic and 
   diluted earnings per share               27,316,175   27,499,434 
                                           ===========  =========== 

4. Dividends

A final dividend of 0.3p per share will be paid on 18 March 2021 to those members on the register at close of business on 12 February 2021.

5. Notice of meeting

The annual report and accounts for the year ended 30 June 2020 will be posted to shareholders in due course and the Annual General Meeting will be held on 10 March 2021.

The Company's registered office is Namber House, 23 Davis Road, Chessington, Surrey, KT9 1HS.

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January 29, 2021 12:05 ET (17:05 GMT)

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