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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 | 0.00% | 38.50 | 37.00 | 40.00 | 38.50 | 36.60 | 38.50 | 2,770 | 08:00:18 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Computers & Software-whsl | 67.15M | -411k | -0.0151 | -25.50 | 10.48M |
TIDMNAR
RNS Number : 4562T
Northamber PLC
15 November 2023
15 November 2023
Northamber PLC
(the "Company" or the "Group")
Preliminary Results for the year ended 30 June 2023
Chairman's Statement
Results
Against a challenging backdrop, we are pleased to share that we have continued to grow revenue year on year by GBP890k from GBP66.26m to GBP67.15m whilst also growing gross margins from 12.8% to 13.3%. This served to generate a continued increase in gross margins of GBP0.43m year on year to GBP8.91m (5% increase year on year) and reflected our continued focus on evolving our product mix towards higher margin, more technical products through Northamber and AVM.
As mentioned in my last statement, we expanded our Audio Visual (AV) unit into Unified Communications and Collaborations (UC&C) during the first half of the year with a new partnership with Yealink who are a significant brand in the Microsoft Teams Room and Zooms room space. This new partnership allowed us to access a significant new UC&C market for our existing reseller customers as well as bring existing products from our Audio Visual and Infrastructure Solutions business units to a wider market. The addition of ViewSonic in H2 to our Audio Visual Business Unit also helped provide growth opportunities.
Despite sales and gross margin growth for the year, performance in some of our focus areas remained impacted by softer demand due to deferred purchasing decisions by some end users as they chose to defer non essential spend in the face of inflationary pressures and continuing economic uncertainty. Our strategy remains to focus on building the best Proactive, Technical distribution company in our focus technology areas of Audio Visual, Network Security & Infrastructure, Document Management & Peripherals as we remain confident we can deliver significant long term value and growth in these segments for our partners and shareholders.
Inflationary pressures combined with our continued investment in developing the team for our growth ambitions led to distribution costs increasing from GBP5.6m to GBP5.9m. Likewise, our administration costs increased from GBP3.4m to GBP3.5m due to inflationary pressures. Some of these cost increases we would hope to be non-recurring or reduced moving forward such as an exceptional GBP110k bad debt write off for the year (up from GBP62k prior year), GBP110k for Electricity and Gas (up from GBP66k prior year and despite the Company installing solar panels at our Swindon Warehouse at the start of the fiscal year) and cost of living pressure on wages (GBP6.15m up from GBP5.67m).
It is frustrating that inflationary factors increasing distribution and administration costs have impacted the Group despite Gross Margin growth. The Group remains committed to proactively working to reduce these costs as best it can.
As part of our focus on profitable scalability and efficiency drive, after the period end, the Group implemented a new company wide ERP system at a committed capital investment of GBP278k. Whilst this new system will cause some initial disruption in H1 FY24 whilst it is rolled out in a phased approach across the half, this new system will allow us to drive a stronger customer experience and better efficiency with automation so we would hope to see a positive impact from this in H2 FY24 and onwards.
The net effect of these results were that Earnings Before Tax Amortisation and Depreciation but After Interest was a modest GBP3k profit, compared with a loss of GBP54k the prior year. At an operating level this delivered a loss before tax for the year of GBP411k versus a loss of GBP447k last year.
We feel strongly, however, that to drive significant long term profitable growth it is important that we continue to invest for the future , albeit these investments are measured against the ability to generate value.
Financial Position
We remain diligent in managing our balance sheet and were pleased to be able to remain debt free; we are a flexible stocking than other commodity focused distributors. Cash reserves at year end increased to GBP5.6 million from GBP4.7 million at 30 June 2022. This focus on cash levels together with stronger interest rates available yielded a benefit of GBP81k of interest, up from GBP5k the prior year. We look to balance the value of cash in the bank with the need to provide flexible stock for our partners and consciously review this on an ongoing basis. Tied to this approach, we disposed of an office building in Lightwater in H1 that was no longer core to our operation for a consideration of GBP1.48 million and moved Audio Visual Material Ltd into a new leased office together with our Audio Visual business unit in Basingstoke.
With Net Assets at GBP23.9 million, including two unencumbered freehold properties, the Group's overall financial position remains very sound.
Net Assets at 87.7p per share are considerably in excess of the average price of the ordinary shares throughout the period.
Dividend
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 19 January 2024 to shareholders on the register as at 15 December 2023.
Staff
Our staff remain a key asset for the business and an area we continue to invest in. The team has continued to work hard to support our partners and each other. Our plans remain to continue to invest in our evolving business model by continuing to invest in building out the best team in the market to achieve our business evolution.
We were pleased to be able to roll out a Company Share Ownership Plan as a long term incentive for all staff in July 2023 (post year end), and see this as a way of rewarding the team who make an impact and drive our results
Outlook
In keeping with prior outlooks that we shared, we remain cautiously optimistic that the investments we have made in supporting our partners will allow us to continue to drive growth of strategic business units. We have yet to fully benefit from these investments, given the ongoing impact of COVID, forex movements and supply chain issues which together with wider economic uncertainty due to rising interest rates, inflation and subsequent cost of living impacts, necessarily mean we must remain cautious about the near term . We do feel strongly, however, that our continued focus on strategic higher margin value categories provides a solid road map for the future with profitable growth opportunities and the ability to unlock long term value for shareholders. The strength of our balance sheet allows us to continue to do what is best for the business strategically and we continue to review organic and non-organic opportunities for growth which meet our strict criteria and add value for our shareholders.
C.M.Thompson
Chairman
15 November 2023
Contacts:
Northamber PLC Tel: +44 (0) 208 744 8200 investor_relations@northamber.com Colin Thompson, Chairman Singer Capital Markets (Nominated Adviser and Sole Broker) +44 (0) 207 496 3000 Philip Davies
NORTHAMBER PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 30 June 2023
2023 2022 Notes GBP'000 GBP'000 Revenue 2 67,149 66,260 Cost of sales (58,243) (57,791) Gross Profit 8,906 8,469 Distribution costs (5,907) (5,556) Administrative costs (3,491) (3,365) Operating Loss (492) (452) Finance income 81 5 Finance cost - - ----------- -------- Loss before tax (411) (447) Tax expense - - Loss for the year and total comprehensive income attributable to the owners (411) (447) =========== ======== Basic and diluted Loss per ordinary (1.51) share 3 p (1.64)p ----------- --------
The above results arise from continuing operations
CONSOLIDATED STATEMENT OF FINANCIAL POSITION At 30 June 2023 2023 2022 GBP'000 GBP'000 Non current assets Property, plant and equipment 5,519 6,919 Intangible assets 1,251 1,309 ----------- --------------- 6,770 8,228 ----------- --------------- Current assets Inventories 11,447 10,649 Trade and other receivables 12,099 11,245 Cash and cash equivalents 5,512 4,696 29,058 26,590 ----------- --------------- Total assets 35,828 34,818
=========== =============== Current liabilities Trade and other payables (11,951) (10,329) Corporation tax payable - (38) ----------- --------------- Total liabilities (11,951) (10,367) ----------- --------------- Net assets 23,877 24,451 =========== =============== Equity Share capital 272 272 Share premium account 5,734 5,734 Capital redemption reserve 1,514 1,514 Retained earnings 16,357 16,931 ----------- --------------- Equity shareholders' funds attributable to the owners of the parent 23,877 24,451 =========== =============== CONSOLIDATED STATEMENT OF CHANGES IN EQUITY At 30 June 2023 Share Share Capital Redemption Retained Total Equity Capital Premium Reserve Earnings Account GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 Balance at 1 July 2021 272 5,734 1,514 17,569 25,089 Dividends - - - (191) (191) Transactions with owners - - - (191) (191) Loss and total comprehensive income for the year - - - (447) (447) Balance at 30 June 2022 272 5,734 1,514 16,931 24,451 Dividends - - - (163) (163) Transactions with owners - - - (163) (163) Loss and total comprehensive income for the year - - - (411) (411) Balance at 30 June 2023 272 5,734 1,514 16,357 23,877 ============ ============ ============ ============ ============= CONSOLIDATED STATEMENT OF CASH FLOWS For the year ended 30 June 2023 2023 2022 GBP'000 GBP'000 Cash flows from operating activities Operating Loss from continuing operations (492) (452) Depreciation of property, plant and equipment 357 336 Amortisation of intangible assets 58 56 Profit on disposal of property, plant and equipment (74) (15) ------------- -------------- Operating loss before changes in working capital (151) (75) Increase in inventories (798) (2,181) Increase in trade and other receivables (854) (492) Increase in trade and other payables 1,622 463 Cash used in operations (181) (2,285) Income taxes paid (38) (120) Net cash used in operating activities (219) (2,405) ------------- -------------- Cash flows from investing activities Interest received 81 5 Proceeds from disposal of property, plant and equipment 1,475 60 Purchase of property, plant and equipment (358) (222) Net cash generated from/(used in) investing activities 1,198 (157) Cash flows from financing activities Dividends paid to equity shareholders (163) (191) Interest paid - - Net cash used in financing activities (163) (191) ------------- -------------- Net increase/(decrease) in cash and cash equivalents 816 (2,753) Cash and cash equivalents at beginning of year 4,696 7,449 Cash and cash equivalents at end of year 5,512 4,696 ------------- --------------
Notes
1. Financial information
This financial information is consistent with the consolidated financial statements of the group for the year ended 30 June 2023. The group's consolidated financial statements have been prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006.
The financial information set out above does not constitute the group's statutory accounts for the years ended 30 June 2022 or 30 June 2023 but is derived from those accounts. The statutory accounts for the year ended 30 June 2022 have been delivered to the Registrar of Companies and those for 2023 will be delivered following the group's annual general meeting. The auditor's report on the 2023 accounts will be unqualified, will not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their reports, and will 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 attributed to individual countries based on the location of the customer. There are no non-current assets outside the UK.
Revenues comprise: 2023 2022 GBP'000 GBP'000 Revenue from contracts with customers - UK 66,489 65,602 -other 660 658 --------- --------- 67,149 66,260 --------- ---------
No customer accounted for more than 10% of the group's revenue for the year.
3. Loss per ordinary share
The calculation of the basic and diluted earnings per share is based on the following data:
2023 2022 GBP'000 GBP'000 Loss for the year attributable to equity holders of the parent company (411) (447) =========== =========== 2023 2022 Number of shares Number Number Weighted average number of ordinary shares for the purpose of basic and diluted earnings per share 27,231,586 27,231,586 =========== ===========
4. Dividends
A final dividend of 0.3p per share will be paid on 19 January 2024 to those members on the register at close of business on 15 December 2023.
5. Notice of meeting
The annual report and accounts for the year ended 30 June 2023 will be posted to shareholders in due course and the Annual General Meeting will be held on 20 December 2023.
The Company's registered office is Namber House, 23 Davis Road, Chessington, Surrey, KT9 1HS.
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November 15, 2023 02:00 ET (07:00 GMT)
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