Find Your Broker
Share Name Share Symbol Market Type Share ISIN Share Description
Plastics Cap. LSE:PLA London Ordinary Share GB00B289KK20 ORD 1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  +0.00p +0.00% 112.00p 110.00p 114.00p 112.00p 112.00p 112.00p 0 08:00:00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Chemicals 76.7 2.8 5.7 19.6 43.67

Plastics Capital PLC Half-year Report

06/12/2017 7:00am

UK Regulatory (RNS & others)


Plastics Capital (LSE:PLA)
Historical Stock Chart

2 Years : From Dec 2016 to Dec 2018

Click Here for more Plastics Capital Charts.

TIDMPLA

RNS Number : 4898Y

Plastics Capital PLC

06 December 2017

6 December 2017

Plastics Capital plc

("Plastics Capital", the "Company" or the "Group")

Interim Results for the six months ended 30 September 2017

Plastics Capital (AIM: PLA) the niche plastics products manufacturer, announces the Company's unaudited interim results for the six months ended 30 September 2017 ("H1"), which are in line with management's expectations.

Financial highlights

 
                              Six months      Six months 
                                   ended           ended       % 
                            30 September    30 September     Change 
                                    2017            2016 
                                 GBP'000         GBP'000 
------------------------  --------------  --------------  --------- 
 Revenue                          36,462          27,771    +31.3% 
------------------------  --------------  --------------  --------- 
 EBITDA*                           2,572           2,731    -5.8% 
------------------------  --------------  --------------  --------- 
 Profit before tax*                1,195           1,637    -27.0% 
------------------------  --------------  --------------  --------- 
 Earnings per share*(+) 
  (p)                                2.8             4.3    -34.9% 
------------------------  --------------  --------------  --------- 
 Dividend per share 
  (p)                                nil            1.46   -100.0% 
------------------------  --------------  --------------  --------- 
 Net Debt                         14,988          15,123    -0.9% 
------------------------  --------------  --------------  --------- 
 

* excluding amortisation, exceptional costs, unrealised foreign exchange translation and derivative gains / losses and share-based incentive scheme charges

+ applying an expected tax charge of 10% (2016-17: 6.5%) and based on the weighted average number of shares in issue in the period.

Operational highlights

   --     13.5% organic revenue growth 
   -    Films Division revenue up 18.9% organically, 15.2% in volume terms 
   -    Industrial Division revenue up 6.9% organically 
   --     Significant costs being incurred to enable sustained growth 

-- Lower profits reflect planned growth strategy, adverse currency and raw material price movements

   --     GBP2.5m invested in development and capacity expansion projects 
   --     Underlying profitability remains strong; constant currency EBITDA up 1.3% 
   --     Benefit of post-Brexit sterling devaluation still to be felt 
   --     Project wins in bearings business continue to build 
   -    GBP6.8m of annual sales from won projects still to enter into production 

-- Interim dividend payment suspended in line with stated strategy to apply cash towards accelerating organic growth

Financial highlights

   --     Oversubscribed equity placing completed raising GBP3.54m (net of expenses) 

Commenting on these results, Faisal Rahmatallah, Executive Chairman, said:

"I am pleased to report strong revenue growth across the Group. We have increased investment in business development, new products, production capacity and employee capabilities. Order books are healthy and we anticipate a significant uplift in profitability during the second half of the financial year which should benefit from the seasonal demand upswing and new business coming on stream. However, due to recent delays in ramp-up of two significant bearings projects, we believe that it is unlikely that there will be sufficient time in the second half year to fully recover. That said, due to the strong sales growth in the first half and on a constant currency basis, the Board expects profits before taxation, to be marginally below consensus market expectations, but well ahead of FY 16-17, for the full financial year."

For further information, please contact:

 
 Plastics Capital plc            Tel: 020 7978 0574 
 Faisal Rahmatallah, Executive 
  Chairman 
 Nick Ball, Finance Director 
 
 Cenkos Securities               Tel: 020 7397 8900 
 (Nomad and joint broker) 
 Mark Connelly 
 Callum Davidson 
 
 Allenby Capital Limited         Tel: 020 3328 5656 
 (Joint broker) 
 David Hart 
 Katrina Perez 
 
 

Notes to Editor

Plastics Capital is a niche manufacturer of specialist plastic products. Applications for these products vary widely and examples include:

   --          Packaging for the food manufacturing and distribution - films, sacks and pouches 

-- Steering columns and instrument control knobs in the automotive industry - plastic ball bearings

   --          Hydraulic and industrial rubber hose manufacture - various types of plastic mandrel 
   --          Cardboard box manufacture - plastic creasing matrices 

Plastics Capital's business model is based on understanding customers' problems in depth, and then developing and mass producing proprietary, technical solutions for these problems. As such many projects take significant time to translate initial sale into volume production.

The business operates through two divisions, Films and Industrial, and has the majority of its production in six UK based factories, with a further three factories in Asia and one in West Virginia, USA. Approximately 45% of its GBP66 million sales, as per FY2017, are made outside the UK to more than 80 countries.

Further information can be found on www.plasticscapital.com

Chairman's Statement

Financial Review

I am pleased to report that Group revenue increased by 31.3% over the same period last year. The key elements of revenue growth in H1 can be summarised as follows:

   --    Organic growth - 13.5% 
   --    Acquisition - 16.0% 
   --    Foreign Exchange - 1.8% 

Following considerable investment in recent years in business development activities and capacity, it is particularly pleasing to report that organic growth has more than doubled over the same period last year, with last year already a doubling on the previous year.

However, profitability has not followed the growth in revenues for the period under review. There are five contributory factors:

-- Investments that we have made to accelerate top line organic growth. These investments are of two types: (a) in people to build business, product and process development capability and (b) in machinery to build production capacity. On a like-for-like* basis, people costs have increased by 12% compared to the prior half year, depreciation costs reflecting investments made in capacity have increased 28% and interest costs reflecting the higher average level of debt in H1 are up 44%. These investments, which have resulted in a "step change" in costs, have facilitated the acceleration in organic growth to the rate now being achieved. All of this has been as planned.

-- The two distributors of creasing matrix and related consumables which we acquired in the prior year have intrinsically lower profit margins, roughly half that of our manufacturing businesses; we have seen a full half year's contribution from these. We expect to get some costs savings from these acquisitions in H2 as the manufacturing consolidation plan has completed more or less to schedule at the end of H1. This has also been as expected.

-- Currency movements have been unfavourable during H1. We have remained hedged for our trading exposure to the dollar and so have not yet felt any benefit from the weakening of sterling following last year's decision to exit the EU. Meanwhile, Sterling's strengthening in H1, in contrast to last year's weakening, has resulted in translational losses compared to last year's gains made. The negative impact of currency on

Pro-forma EBITDA** compared to the prior half year has been circa GBP0.2m. These matters are largely outside of our control and not what we expected.

-- Weaker than expected sales in our more operationally geared Industrial Division, particularly bearings and stronger sales than expected in our less operationally geared Films Division. This has the effect of reducing gross margins for the Group overall relative to expectations. Contrary to our internal forecasts, sales of bearings since August have been below expectations due to two large projects for major key accounts falling short of planned production volumes in their ramp-up phases. This is largely outside our control but we believe that this is a temporary lull.

* "Like-for-like" means comparison between years applying a constant exchange rate and assuming no impact from acquisitions. ** "Pro-forma" means comparison between years assuming no impact from acquisitions

-- Commodity raw material prices in the Films Division rose sharply in Q1 and caused short term margin pressure until we adjusted our prices accordingly. This is a characteristic of this industry and can work the other way as commodity raw material prices are relatively volatile.

Overall, therefore, despite a 31.3% increase in sales, EBITDA was down 5.8% to GBP2.57m and profit before tax was down 27% to GBP1.20m compared to the same period in FY16-17. Whilst this appears disappointing, it chiefly reflects our planned growth strategy and adverse currency and raw material price movements. We believe that the benefit of sterling weakness since Brexit will start to be felt in FY18-19; however, as I have indicated before, we must not allow this to make us complacent.

Our effective corporation tax rate is estimated to remain low but increase from 6.5% to 10% for the full year as the Group now has more than 500 employees and so receives less benefit from the R&D tax credit than previously. We believe our effective corporation tax rate will be 10% or less for the foreseeable future.

We issued 3,194,445 shares via a placing at the end of May 2017 at 117p raising approximately GBP3.54m (net of expenses) during the half year. This capital has assisted the investment strategy that we have been following for the last 2-3 years. Consequently, underlying earnings per share for H1 17-18, compared to H1 16-17, has decreased 34.9% from 4.3p to 2.8p.

Films Division

The Films Division accounted for approximately 53% of Group sales in H1 including a full contribution from Synpac, acquired in July 2016, which has continued to achieve profits in line with our expectations at the time of acquisition. Currency movements during H1 increased material costs as certain films are imported from Europe and converted in the UK; which resulted in the adverse impact on EBITDA due to foreign exchange movements of 4.9%. On a like-for-like basis H1 sales were up 18.9% and EBITDA by 14.8%.

Flexipol performed very well in H1. Organic sales growth increased by 16.4% to GBP10.2m, with total tonnes sold increasing by 14.4% compared to the previous year. These increases reflect the Group's investments in new products and capacity made over the last two years. Since certain materials are purchased from European suppliers, there has been some small erosion of value added margin during H1 as raw material prices went up faster than sales prices during H1. This was similar to what happened in H1 in the prior year. People and overhead costs have been increased to cope with the growth being experienced but profit margins have remained satisfactory.

Palagan has started to improve its performance following a disappointing FY16-17. Now operating with an increased cost base after the strategic changes made last year, sales have increased by 18.6% to GBP6.6m and by 14.2% in tonnes sold. Like Flexipol, there has been some slight erosion in value-added margin as raw material prices have increased faster than selling prices during H1. However, profitability for H1 is not materially different from the first half of the prior year and the "direction of travel" is positive. We are pleased with the progress the new team has achieved in a relatively short time and anticipate further improvement to sales and to profitability over the next two years.

Working now with the Flexipol sales team, Synpac is pursuing an aggressive growth strategy, taking advantage of its excellent market reputation and significant spare capacity. Sales in H1 were up an excellent 18.5% compared to prior year on a like-for-like basis. Synpac buys in the vast majority of its raw material as extruded film, rather than raw granules, from Europe and so has suffered more than our other Films businesses from margin erosion due to the strength of the Euro during H1. This is being addressed through price increases implemented towards the end of H1. Nevertheless, Synpac is delivering the profits we expected at the time of acquisition.

Industrial Division

In the period under review, I am pleased to report that revenue in the Industrial Division, which accounted for approximately 47% of Group sales, were 36.5% up on the same period last year. On a like-for-like basis revenues were up 6.9%. This includes a full contribution from CCM and Mito, both distributors and small manufacturers of creasing matrix and related consumables, which were acquired in the prior year. These businesses have added 25.7% to Industrial Division turnover but less to EBITDA; we expect this to significantly improve going forward since the manufacturing consolidation planned for these businesses at the time of acquisition was completed at the end of H1. Currency movements added 3.9% to sales but not to EBITDA as the costs of people employed outside the UK has increased and we suffered translational losses in the period compared to gains in the first half of last year.

Bearings business sales were up 5% in H1 compared to the same period in the prior year; ignoring currency movements the improvement was 0.4%. As stated above, demand resulting from two major projects were significantly below expectations in the last two months of H1. We are expecting some recovery of this in H2 and together with other recently won projects entering production, we expect a resumption of good organic growth at BNL in H2. The new business pipeline at BNL (projects already won but not yet in production or not yet at full production rate) has increased from GBP5.0m at the end of FY16-17 to GBP5.7m at the end of H1. This reinforces our view that the slowdown that we have seen in H1 is a temporary matter, even if the two large projects remain slower to ramp up than we have previously expected.

Creasing matrix and related consumables were up 90% in H1 compared to the first six months of the prior year but the vast majority of this was due to acquisitions. Like-for-like sales were up 2.8%. The business has been extremely busy integrating the recent acquisitions and bedding down the recent factory move in China. The small manufacturing operations at CCM and Mito have been closed down and production moved to C&T's main production facility in Wellingborough. This rationalisation will both reduce costs and free up space and time in these businesses to increase sales.

Our mandrel business has had an exceptional period. Sales were up 39.6% overall of which 5.7% is due to currency movements, meaning like-for-like sales were up 33.9% on the same period in the prior year. Costs have been increased to cope with the new level of sales and two further production lines have been added. As a result, profitability has lagged slightly behind sales but we are very pleased with the business's achieved growth.

Growth & Investment

We are now two and a half years into our five-year target to double annual EBITDA to GBP10.5m. This target excludes contributions from acquisitions requiring new equity to be raised. We are now achieving the revenue growth necessary to deliver this target and believe that the EBITDA growth will soon follow.

As we have articulated before, growth necessitates investment. In total in H1, GBP3.0m has been invested in capital projects or investments in businesses - Synpac, CCM and Mito. I wrote to shareholders in July 2017 to explain where we needed to invest and can report as follows on what has been achieved so far this financial year:

-- Customer specific projects - Our bearings business has invested GBP0.28m during H1 in two new moulding machines dedicated to a major new project won in the home appliance sector which is due to commence in H2 17-18. This was our plan for the full year, but we now anticipate a further GBP0.3m to be invested as further major projects have been won in the last few months.

-- Capacity - We have added two further mandrel lines now making 11 in total. A new high output conversion machine for relatively simple products has been added at Flexipol to broaden their range of products and relieve capacity elsewhere for their more complex products. A further injection moulding machine has been added to the machine park at our bearings business to provide additional capacity generally. It total GBP0.63m has been invested in the half year on these necessary capacity expansion initiatives. A total of GBP1.5m of expenditure remains the expectation for the full year.

-- New Product Introduction - GBP0.25m on machinery and test equipment related to new product introduction and patents has been invested in H1 17-18. Some of this has gone to Palagan for new products that they are in the process of introducing and the rest to BNL and C&T. The plan was to invest GBP0.7m in this area during the full financial year.

-- Corporate - We have exercised our option to acquire a further 39% stake in CCM in August'17 for a cost of approximately GBP0.92m and to provide GBP0.2m of additional working capital on loan, alongside similar funding from CCM's 51% shareholders to assist the business to expand its geographic reach. Small deferred consideration payments have been made for Synpac and Mito, amounting to GBP0.45m. This area has progressed more or less as expected when we reported in July 2017.

In addition, GBP0.48m of expenditure has been made on maintenance and replacement items across all our factories. So, in total for H1 17-18 we have invested GBP3.0m; this compares to the GBP4.3m we had planned to invest for the full financial year. We currently expect to continue to invest to the originally planned level, or possibly a little beyond, for the current financial year.

Equity Placing and Debt

As mentioned above, we issued 3,194,445 new shares at the end of May 2017 through an oversubscribed placing to certain institutional investors. This has given us additional financial flexibility to make the investments set out above ahead of the schedule originally anticipated and, potentially, to continue at this higher rate of investment during 2018-19 too.

Net Debt at the end of H1 stood at GBP15.0m down from GBP16.5m at the end of FY 16-17, assisted by the funds received from the placing mentioned above and by tight working capital management. Statutory net debt leverage has been maintained at 2.15 times and in the next twelve months we expect will come down to 1.5- 2.0 times, which is the target we have set ourselves. Meanwhile, interest cover is very solid at 8.2 times.

Dividend

At the time of the equity placing in May 2017, we explained that we would suspend dividends payments for at least the next two scheduled payments. The Directors estimated at the time that this will result in a cash saving of approximately GBP1.7m. The cash saving is being re-invested in the business, alongside the net proceeds of the Placing. Thereafter, the Directors will reconsider the payment of dividends within the overall context of capital allocation decisions then facing the Company.

Outlook

The pattern of trading that we have seen so far this year is continuing in H2, with very strong performance in the Films Division and in our mandrels business, steady performance in our matrix group and slower growth than expected in our bearings business. On the positive, the conversion of projects into confirmed orders in the bearings business has continued at the high levels that we have experienced over the last two years and so we are confident that this business will return to the higher rates of growth that we saw in FY16-17. This, together with what we are achieving in our other businesses, causes the Board to be confident about the outcome for the current financial year and future growth of the Group for the medium to longer term.

Faisal Rahmatallah

Executive Chairman

Plastics Capital plc

Unaudited Consolidated Income Statements and Statements of Comprehensive Income

for the six months ended 30 September 2017 and the six months ended 30 September 2016

 
                                Before                                               Before 
                               foreign       Foreign                                foreign       Foreign 
                              exchange      exchange                               exchange      exchange 
                                     &        impact                                      &        impact 
                           exceptional            on   Exceptional              exceptional            on   Exceptional 
                                 items   derivatives         items      Total         items   derivatives         items      Total 
                                  2017          2017          2017       2017          2016          2016          2016       2016 
                    Note       GBP'000       GBP'000       GBP'000    GBP'000       GBP'000       GBP'000       GBP'000    GBP'000 
 
 Revenue                        36,462             -             -     36,462        27,771             -             -     27,771 
 
 Cost of 
  sales                       (24,836)         (404)             -   (25,240)      (18,586)         (308)             -   (18,894) 
 
 Gross 
  profit                        11,626         (404)             -     11,222         9,185         (308)             -      8,877 
 
 Distribution 
  expenses                     (1,885)             -             -    (1,885)       (1,376)             -             -    (1,376) 
 
 Administration 
  expenses                     (8,293)             -         (219)    (8,512)       (6,357)             -         (269)    (6,626) 
 
 Other 
  income                             -             -             -          -            36             -             -         36 
 
 Operating 
  profit                         1,448         (404)         (219)        825         1,488         (308)         (269)        911 
 
 Financial 
  income             5               -         1,179             -      1,179             -             -             -          - 
 
 Finance 
  expense            5           (438)             -             -      (438)         (399)       (1,240)             -    (1,639) 
 
 Net financing 
  (costs) 
  / income                       (438)         1,179             -        741         (399)       (1,240)             -    (1,639) 
 
 Profit 
  / (loss) 
  before 
  tax                            1,010           775         (219)      1,566         1,089       (1,548)         (269)      (728) 
 
 Tax                 6           (101)             -             -      (101)         (107)             -             -      (107) 
 
 Profit 
  / (loss) 
  for the 
  period                           909           775         (219)      1,465           982       (1,548)         (269)      (835) 
 
 
 Attributable 
  to: 
  Equity 
  holders 
  of the 
  parent                           957           775         (219)      1,513           982       (1,548)         (269)      (835) 
 Non-controlling 
  interest                        (48)             -             -       (48)             -             -             -          - 
 
 Profit 
  / (loss) 
  for the 
  period                           909           775         (219)      1,465           982       (1,548)         (269)      (835) 
 
 
 Foreign 
  exchange 
  translation 
  differences                    (232)             -             -      (232)           (4)             -             -        (4) 
 
   Total 
   comprehensive 
   income/(loss)                   677           775         (219)      1,233           978       (1,548)         (269)      (839) 
 
 
 Earnings per 
  share 
 Basic               8                                                   3.9p                                               (2.4)p 
 Diluted             8                                                   3.8p                                               (2.4)p 
 

Plastics Capital plc

Consolidated Income Statement and Statement of Comprehensive Income (continued)

for the year ended 31 March 2017

 
                                      Audited        Audited 
                                       Before        Foreign 
                                      foreign       exchange 
                                     exchange         impact        Audited 
                                & exceptional             on    Exceptional    Audited 
                                        items    derivatives          items      Total 
                                         2017           2017           2017       2017 
                       Note           GBP'000        GBP'000        GBP'000    GBP'000 
 
 Revenue                               65,785              -              -     65,785 
 
 Cost of 
  sales                              (43,703)          (953)              -   (44,656) 
 
 Gross 
  profit                               22,082          (953)              -     21,129 
 
 Distribution 
  expenses                            (3,100)              -              -    (3,100) 
 
 Administration 
  expenses                           (13,852)              -          (907)   (14,759) 
 
 Other 
  income                                   33              -              -         33 
 
 Operating 
  profit                                5,163          (953)          (907)      3,303 
 
 Financial 
  expense                5            (1,293)        (1,244)              -    (2,537) 
 
 Net financing 
  costs                               (1,293)        (1,244)              -    (2,537) 
 
 Profit before 
  tax                                   3,870        (2,197)          (907)        766 
 
 Tax                     6              (227)              -              -      (227) 
 
 Profit for the 
  year                                  3,643        (2,197)          (907)        539 
 
 Attributable 
  to: 
 Equity holders 
  of the parent                         3,536        (2,197)          (907)        432 
 Non-controlling 
  interest                                107              -              -        107 
 
 Profit 
  for the 
  year                                  3,643        (2,197)          (907)        539 
 
 Foreign exchange 
  translation differences                 607              -              -        607 
 
 Total comprehensive 
  income                                4,250        (2,197)          (907)      1,146 
 
 
 Earnings per share 
 Basic                   8                                                        1.5p 
 Diluted                 8                                                        1.5p 
 

Plastics Capital plc

Consolidated Balance Sheets

 
 
                                    Unaudited    Unaudited    Audited 
                                        As at        As at      As at 
                                           30           30         31 
                                    September    September      March 
                                         2017         2016       2017 
                                       GBP000       GBP000     GBP000 
Non-current assets 
   Property, plant and 
    equipment                          11,677        9,382     11,057 
   Intangible assets                   27,339       24,286     26,376 
 
                                       39,016       33,668     37,433 
 
Current assets 
   Inventories                          7,372        5,712      6,657 
   Trade and other receivables         16,037       12,556     15,482 
   Cash and cash equivalents            4,991        4,150      4,914 
 
                                       28,400       22,418     27,053 
 
Total assets                           67,416       56,086     64,486 
 
 
Current liabilities 
   Interest-bearing loans 
    and borrowings                      6,199        5,810      6,199 
   Trade and other payables            15,082        9,872     14,502 
   Corporation tax liability              445          495        448 
 
                                       21,726       16,177     21,149 
 
Non-current liabilities 
   Interest-bearing loans 
    and borrowings                     13,781       13,463     15,037 
   Other financial liabilities             98        1,307      1,277 
   Deferred tax liabilities             1,182          361      1,182 
 
                                       15,061       15,131     17,496 
 
Total liabilities                      36,787       31,308     38,645 
 
Net assets                             30,629       24,778     25,841 
 
Equity attributable 
 to equity holders of 
 the parent 
   Share capital                          389          356        357 
   Share premium                       24,912       21,263     21,396 
   Reverse acquisition 
    reserve                             2,640        2,640      2,640 
   Translation reserve                    989          652      1,246 
   Retained earnings                    2,036        (133)        491 
 
Total Parent equity                    30,966       24,778     26,130 
 
   Non-controlling interest             (337)            -      (289) 
 
Total equity                           30,629       24,778     25,841 
 
 

Plastics Capital plc

Consolidated Cash Flow Statements

 
                                    Unaudited    Unaudited   Audited 
                                   Six months   Six months      Year 
                                        ended        ended     ended 
                                           30           30        31 
                                    September    September     March 
                                         2017         2016      2017 
                                       GBP000       GBP000    GBP000 
 
Profit / (loss) after 
 tax for the period                     1,465        (835)       539 
   Adjustments for: 
    Income tax adjustment                 101          107       227 
    Depreciation, amortisation 
     and impairment                     1,448        1,551     2,525 
    Financial income                  (1,179)            -         - 
    Financial expense                     438        1,639     2,537 
    Gain on disposal of 
     plant, property and 
     equipment                              -            -      (18) 
    LTIP charge                            80            -       165 
 
   Changes in working capital: 
    (Increase) in trade 
     and other receivables              (555)         (25)   (2,020) 
    (Increase) in inventories           (715)        (408)     (796) 
    Increase in trade and 
     other payables                       480          104     3,080 
 
Cash generated from 
 operations                             1,563        2,133     6,239 
 
   Interest paid                        (392)        (292)     (725) 
   Income tax paid                      (104)            -     (474) 
 
Net cash from operating 
 activities                             1,067        1,841     5,040 
 
Cash flows from investing 
 activities 
   Acquisition of subsidiary 
    (net of cash acquired)            (1,381)      (2,470)   (4,095) 
   Acquisition of property, 
    plant and equipment               (1,650)      (1,896)   (3,499) 
   Dividends received                       -            -        15 
   Proceeds from disposal 
    of plant, property and 
    equipment                               -            -        26 
   Development expenditure 
    capitalised                         (125)        (125)     (539) 
 
Net cash from investing 
 activities                           (3,156)      (4,491)   (8,092) 
 
Cash flows from financing 
 activities 
   Net proceeds from new 
    loan                                    -        2,641     5,512 
   Change in borrowings               (1,156)        (847)   (1,131) 
   Equity raise (net)                   3,548            -         - 
   Dividends paid                           -      (1,038)   (1,110) 
 
Net cash from financing 
 activities                             2,392        1,756     3,271 
 
Increase in cash, cash 
 equivalents and bank 
 overdrafts                               303        (894)       219 
   Cash and cash equivalents 
    at 1 April                          4,914        5,488     5,488 
   Overdraft at 1 April               (4,511)      (5,304)   (5,304) 
 
Cash, cash equivalents 
 and bank overdrafts 
 at 30 September and 
 31 March                                 706        (710)       403 
 
 

Plastics Capital plc

Consolidated statement of changes in equity

 
                                                         Reverse                  Total           Non- 
                         Share     Share  Translation   acquisition    Retained   Parent   controlling    Total 
                       capital   premium      reserve     reserve      earnings   equity     interests   equity 
                        GBP000    GBP000       GBP000        GBP000      GBP000   GBP000        GBP000   GBP000 
 
Balance at 31 
 March 2016                353    20,951          639         2,640       1,740   26,323             -   26,323 
 
Share issue                  3       312            -             -           -      315             -      315 
Profit or loss               -         -           13             -       (835)    (822)             -    (822) 
Dividends paid               -         -            -             -     (1,038)  (1,038)             -  (1,038) 
 
Balance at 30 
 September 2016            356    21,263          652         2,640       (133)   24,778             -   24,778 
 
Share issue                  1       133            -             -           -      134             -      134 
Profit or loss               -         -          594             -         925    1,519         (107)    1,412 
Elimination 
 of non-controlling 
 interests                   -         -            -             -           -        -         (182)    (182) 
Dividends paid               -         -            -             -        (72)     (72)             -     (72) 
LTIP charge                                                                 165      165             -      165 
Settlement of 
 LTIP 2011                                                                (394)    (394)             -    (394) 
 
Balance at 31 
 March 2017                357    21,396        1,246         2,640         491   26,130         (289)   25,841 
 
Share issue                 32     3,516            -             -           -    3,548             -    3,548 
Profit or loss               -         -        (257)             -       1,465    1,208            48    1,256 
Elimination 
 of non-controlling 
 interests                   -         -            -             -           -        -          (96)     (96) 
LTIP charge                                                                  80       80             -       80 
 
Balance at 30 
 September 2017            389    24,912          989         2,640       2,036   30,966         (337)   30,629 
 
 
   1          Basis of preparation and accounting policies 

Basis of preparation

The interim financial information has been prepared on the basis of the recognition and measurement requirements of adopted IFRSs as at 30 September 2017 that are effective (or available for early adoption) as at 31 March 2018. Based on these adopted IFRSs, the directors have applied the accounting policies, as set out below, which they expect to apply to the annual IFRS financial statements for the year ending 31 March 2018.

However, the adopted IFRSs that will be effective (or available for early adoption) in the annual financial statements for the period ending 31 March 2017 are still subject to change and to additional interpretations and therefore cannot be determined with certainty. Accordingly, the accounting policies for that annual period will be determined finally only when the annual financial statements are prepared for the period ending 31 March 2018.

Accounting policies

The accounting policies applied to the Interim Results for six months ended 30 September 2017 are consistent with those of the Company's annual accounts for the year ended 31 March 2017.

Going concern

The Financial Reporting Council issued "Going Concern and Liquidity Risk: Guidance for Directors of UK Companies" in October 2009 and the Directors have considered this when preparing the financial statements. These have been prepared on a going concern basis and the Directors have taken steps to ensure that they believe the going concern basis of preparation remains appropriate.

   2          Reconciliation of financial highlights table to the consolidated income statement 
 
                                    Unaudited      Unaudited 
                                   Six months     Six months 
                                           to             to 
                                 30 September   30 September    Change 
                                         2017           2016 
                                       GBP000         GBP000         % 
 
Revenue                                36,462         27,771     31.3% 
------------------------------  -------------  -------------  -------- 
Gross profit                           11,222          8,877     26.4% 
------------------------------  -------------  -------------  -------- 
Operating profit                          825            911     -9.4% 
------------------------------  -------------  -------------  -------- 
 
Add back: Exceptional 
 cost                                     219            269 
Add back: Amortisation                    418            749 
Add back: Depreciation                  1,030            802 
Add back: LTIP charge                      80              - 
 
EBITDA before exceptional 
 costs                                  2,572          2,731     -5.8% 
------------------------------  -------------  -------------  -------- 
 
Profit / (loss) before 
 tax                                    1,566          (728)    315.1% 
------------------------------  -------------  -------------  -------- 
 
Add back: Exceptional 
 costs                                    219            269 
Add back: Amortisation                    418            749 
Add back: Capitalised 
 deal fee amortisation                     43            107 
Add back: Unrealised 
 foreign exchange & derivate 
 (gains) / losses                     (1,179)          1,240 
Add back: LTIP charge                      80              - 
Add back: Non-controlling 
 interest loss                             48 
 
Profit before tax*                      1,195          1,637    -27.0% 
------------------------------  -------------  -------------  -------- 
 
Taxation                                (101)          (107) 
 
Profit after tax*                       1,094          1,530    -28.5% 
------------------------------  -------------  -------------  -------- 
Basic adjusted EPS*+                     2.8p           4.3p     34.9% 
------------------------------  -------------  -------------  -------- 
Basic EPS                                3.9p         (2.4)p   -262.5% 
------------------------------  -------------  -------------  -------- 
Capital expenditure                     1,650          1,896    -13.0% 
------------------------------  -------------  -------------  -------- 
Net Debt                               14,988         15,123     -0.9% 
------------------------------  -------------  -------------  -------- 
 
 

* excluding amortisation, exceptional costs, unrealised foreign exchange translation and derivative gains/losses, capitalised deal fee amortisation, share-based incentive scheme charges and non-controlling interests

+ applying an expected tax charge of 10% (2016-17: 6.5%) and based on the average number of shares in issue in the year

   3          Operating segment information 

The following summary describes the operations in each of the Group's reportable segments:

   --    Films - includes industrial films 
   --    Industrial - includes hose mandrel, creasing matrix and plastic bearings 
 
                                                                         Unallocated 
                                        Industrial           Films   and reconciling           Total 
                                                                               items 
                                    --------------  --------------  ----------------  -------------- 
 
                                         Unaudited       Unaudited         Unaudited       Unaudited 
                                        Six months      Six months        Six months      Six months 
                                                to              to                to              to 
                                      30 September    30 September      30 September    30 September 
                                              2017            2017              2017            2017 
                                            GBP000          GBP000            GBP000          GBP000 
 
    External sales*                         17,071          19,391                 -          36,462 
    Profit before tax**                        181             402               983           1,566 
    Depreciation and amortisation              674             348               426           1,448 
                                           _______         _______           _______          ______ 
 
 
                                         Unaudited       Unaudited         Unaudited       Unaudited 
                                        Six months      Six months        Six months      Six months 
                                                to              to                to              to 
                                      30 September    30 September      30 September    30 September 
                                              2016            2016              2016            2016 
                                            GBP000          GBP000            GBP000          GBP000 
 
    External sales*                         12,455          15,316                 -          27,771 
    Profit / (loss) before 
     tax**                                     635             153           (1,516)           (728) 
    Depreciation and amortisation              471             303               777           1,551 
                                           _______         _______           _______         _______ 
 
 
                                           Audited         Audited           Audited         Audited 
                                           Year to         Year to           Year to         Year to 
                                          31 March        31 March          31 March        31 March 
                                              2017            2017              2017            2017 
                                            GBP000          GBP000            GBP000          GBP000 
 
    External sales*                         32,472          33,313                 -          65,758 
    Profit / (loss) before 
     tax**                                   1,887           1,340           (2,461)             766 
    Depreciation and amortisation            1,057             654             1,149           2,860 
                                           _______         _______           _______         _______ 
 
* All revenue is attributable to external customers, 
 there are no transactions between operating segments 
** Profit before tax for unallocated and reconciling 
 items is analysed on Page 16. 
 
 
 
   3          Operating segment information (continued) 

Reconciliation of reportable segment revenue

 
                                                                            Audited 
                                            Unaudited          Unaudited    Year to 
                                           Six months         Six months   31 March 
                                      to 30 September    to 30 September       2017 
                                                 2017               2016     GBP000 
                                               GBP000             GBP000 
Films 
 High strength film 
  packaging                                    19,391             15,316     33,313 
Industrial 
 Packaging consumables                          7,090              3,667     12,663 
 Plastics rotating parts                        6,947              6,614     14,800 
 Hydraulic hose consumables                     3,034              2,174      5,009 
 
Turnover per consolidated income 
 statement                                     36,462             27,771     65,785 
 
 

Reconciliation of reportable segment profit

 
                                     Unaudited       Unaudited     Audited 
                                    Six months      Six months     Year to 
                                            to              to    31 March 
                                     September    30 September        2017 
                                          2017            2016      GBP000 
                                        GBP000          GBP000 
 
 Total profit for reportable 
  segments                                 583             788       3,227 
 
 Unallocated amounts: 
  Amortisation                           (418)           (749)       (604) 
  Unrealised gains / (losses) 
  on derivatives                         1,179         (1,240)       (862) 
  Management charge income               2,145           2,125       4,050 
  FX hedge (loss) on forward 
   contracts                             (404)           (307)       (953) 
  Plastics Capital Trading 
   Ltd and Plastics Capital 
   plc costs                             (829)           (641)     (1,927) 
  Other foreign exchange 
   costs                                     -               -       (382) 
  LTIP charge                             (80)               -       (165) 
  Net interest costs                     (395)           (292)       (694) 
  Deal fee amortisation                   (43)           (107)       (568) 
  Exceptional costs                      (219)           (269)       (406) 
  Other                                     47            (36)          50 
 
 Consolidated profit / (loss) 
  before income tax                      1,566           (728)         766 
 
 
 
   4          Exceptional items 
 
Administrative Expenses                                                  Audited 
                                         Unaudited          Unaudited       Year 
                                        Six months         Six months         to 
                                   to 30 September    to 30 September   31 March 
                                              2017               2016       2017 
                                            GBP000             GBP000     GBP000 
 
Redundancy & recruitment 
 costs                                          70                  -         79 
Acquisitions - professional 
 and legal costs                               149                269        314 
Factory relocations                              -                  -        395 
Other                                            -                  -        119 
 
                                               219                269        907 
 
 
 
   5          Financial income and expenses 
 
                                    Unaudited      Unaudited    Audited 
                                   Six months     Six months    Year to 
                                           to             to   31 March 
                                 30 September   30 September       2017 
                                         2017           2016     GBP000 
                                       GBP000         GBP000 
Financial expenses: 
 Bank interest                            395            292        725 
 Amortisation of capitalised 
  deal fees                                43            107        360 
 Write-off of capitalised 
  deal fees                                 -              -        208 
 
Financial expenses                        438            399      1,293 
 
Financial income and expenses included 
 within foreign exchange: 
 Net foreign exchange 
  (gains) / losses                          -              -        382 
 Unrealised (gains) / losses 
  on derivatives used to 
  manage foreign exchange 
  risk                                (1,179)          1,240        862 
 
Foreign exchange impact 
 and derivatives                      (1,179)          1,240      1,244 
 
 
   6          Taxation 

The taxation charge is calculated by applying the Directors' best estimate of the annual tax rate for the profit for the period.

   7          Dividends 

The Directors have not recommended the payment of an interim dividend (30 September 2016: 1.46p).

   8          Earnings per share 
 
                                 Unaudited      Unaudited     Audited 
                                Six months     Six months     Year to 
                                        to             to    31 March 
                              30 September   30 September        2017 
                                      2017           2016 
                                    GBP000         GBP000      GBP000 
Numerator 
(Loss) / profit for the 
 period                              1,465          (835)         539 
                             -------------  -------------  ---------- 
 
Denominator 
                             -------------  -------------  ---------- 
Weighted average number 
 of shares used in basic 
 EPS                            37,364,795     34,512,663  34,957,994 
Weighted average number 
 of shares used in diluted 
 EPS                            39,001,714     36,665,359  36,632,457 
 
 
Basic earnings per share 
 (total)                              3.9p         (2.4)p        1.5p 
Diluted earnings per share 
 (total)                              3.8p         (2.4)p        1.5p 
 
 
   9          Accounts 

Copies of the interim accounts may be obtained from the Company Secretary at the Registered Office of the Company: London Heliport, Bridges Court Road, London, SW11 3BE.

   10        Acquisitions 

In the six-month period to 30 September 2017, Plastics Capital made the following payments for acquisitions and investments:

-- Synpac Limited - GBP310,000 paid in July'17 relating to deferred consideration on the acquisition made a year earlier;

-- CCM Inc - $1,200,000 paid in August'17 to acquire an additional 39% shareholding in the business; and

-- Mito Srl - EUR150,000 paid in April'17 relating to deferred consideration on the investment made in December'16

This information is provided by RNS

The company news service from the London Stock Exchange

END

IR DBBDDDGGBGRU

(END) Dow Jones Newswires

December 06, 2017 02:00 ET (07:00 GMT)

1 Year Plastics Capital Chart

1 Year Plastics Capital Chart

1 Month Plastics Capital Chart

1 Month Plastics Capital Chart
Your Recent History
LSE
PLA
Plastics C..
Register now to watch these stocks streaming on the ADVFN Monitor.

Monitor lets you view up to 110 of your favourite stocks at once and is completely free to use.

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V:gb D:20181216 17:07:55