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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
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Stadium Grp. | LSE:SDM | London | Ordinary Share | GB0008375098 | ORD 5P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 121.00 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
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0 | 0 | N/A | 0 |
RNS Number:9052H Stadium Group PLC 25 February 2003 25 February 2003 STADIUM GROUP PLC SEES PRE-EXCEPTIONAL EARNINGS PER SHARE DOUBLE Stadium Group plc, the AIM listed provider of Electronic Manufacturing Services, today announced its preliminary results for the year ended 31 December 2002, ahead of market expectations. HIGHLIGHTS FOR YEAR ENDED 31 DECEMBER 2002 * Turnover from continuing activities up by 4% to #35.4m, including Stadium Asia turnover up by 45% to #11.7m. * Group operating profit on continuing activities before goodwill amortisation up by 59% to #1.5m. * Group operating loss of #0.35m down from #5.6m. * Profit on continuing activities before tax, goodwill and exceptional items of #1.2m. * Stadium Asia operating profits up eight-fold to #0.78m. * Pre-exceptional earnings per share from continuing activities more than doubled to 4.0 pence. * Basic loss per share reduced from 28p to 3p. * Net bank borrowings reduced by #6.6m to #4.5m, giving year end gearing of 36%. * Proposed full year dividend unchanged at 2.8 pence, representing a yield of approximately 8%. * Net asset value of 45 pence per share. * Substantial new business wins have brought Asia factory to 60% capacity. * Intention to incorporate new subsidiary in the People's Republic of China with domestic selling rights. * Board remains positive about prospects for future growth. Commenting on the results, Nigel Rogers, Chief Executive, said: "We are now in a phase of strong organic growth at Stadium Asia, and our UK operations have been stabilised. The strength of our balance sheet indicates ample financial resources, and we have a strong team of dedicated people providing first class services to an expanding list of high quality customers, many of whom are household names." For further information please contact: Nigel Rogers, Chief Executive, Stadium Group plc 020 7786 9600 (today) 01429 852 500 (thereafter) Keeley Clarke, Binns & Co PR Ltd 020 7786 9600 (today) 0113 242 1171 (thereafter) STADIUM GROUP PLC CHIEF EXECUTIVE'S REVIEW Overview We are pleased to report trading results which are ahead of expectations, further substantial reductions in net borrowings and a positive outlook for the year ahead. This has been achieved against a difficult backdrop, with most UK-based manufacturers, including both our customers and competitors, facing tougher market conditions as volumes and margins come under continued pressure. By contrast, rapid development of the Pearl River delta area of South Eastern China for both sourcing and OEM inward investment has fuelled excellent growth in turnover and earnings at Stadium Asia. Within the group results from continuing activities we have also borne the effects of a weakening US dollar and additional costs associated with the funding of UK pension obligations. Results and Dividend Profit before tax, goodwill amortisation and exceptional items from continuing activities was #1.22m, based on operating profits up 59% to #1.49m (2001 : #0.93m) less interest costs of #267,000 (2001 : #939,000). Earnings from these activities was more than doubled to 4.0 pence per share from 1.9 pence. Basic earnings, after the impact of discontinued activities, disposals and goodwill amortisation, were a loss of 3.0 pence per share against a loss of 28.3 pence in 2001. This reflects the final phase of implementation of the June 2001 strategic review and further exceptional costs are anticipated to be minimal. Net borrowings were reduced by #6.57m to #4.52m to give gearing of 36%. These figures are expressed without allowing for deferred consideration receivable totalling #2.30m, including #1.02m during 2003. Adjusted gearing net of deferred consideration was 18%. The Board proposes a final dividend of 1.85 pence per share, bringing the total for the year to 2.8 pence (2001 : 2.8 pence). The final dividend will be payable to shareholders on the register on 4 April 2003 and will be paid on 5 May 2003. Electronics 2002 2001 #'000 Continuing Total Continuing Total Turnover 25,486 26,921 24,222 28,974 Operating profit (before 799 625 295 178 exceptionals) Operating margin 3.1% 2.3% 1.2% 0.6% Turnover at Stadium Asia increased by 45% to #11.71m, and operating profits increased eight-fold to #0.78m. These results were especially strong in view of the ten per cent depreciation of the Hong Kong Dollar relative to sterling during the year. The increase in turnover is attributable to the full annual impact of major automotive and consumer products contracts won in 2001, and the introduction of new customers including a leading producer of domestic appliance controls. The rapid introduction of new business brought capacity utilisation to around 60%, with resulting benefits in operational gearing. We have continued to invest in developing the capability of the business, and this is attracting more complex projects. The level of new business won towards the end of the year gives us confidence that strong growth can be sustained in the coming year. Negotiations are ongoing to incorporate a new subsidiary in the People's Republic of China with domestic selling rights. This will place Stadium in a strong position to exploit major opportunities in high growth consumer, telecommunications and automotive markets in the region. UK electronics achieved results slightly better than break even despite a decline in turnover of more than 20% to #13.77 million. This reduction reflects the continuing difficult conditions for UK based manufacturers. Exceptional costs of #0.39m were borne in closing a number of sites, and our UK headcount in electronics fell by almost half from 529 to 275. Our businesses in the UK are lean and well managed, and remain an important part of our service offer to customers, both in their own right and as a gateway to Stadium Asia. Plastics - continuing activities 2002 2001 #000's #000's Turnover 9,889 9,909 Operating profit (before exceptionals) 922 828 Operating margin 9.3% 8.4% Operations at Chingford were able to deliver improved profits in stable markets, making a valuable contribution to the group's overall performance. Investment in additional plastic injection moulding capacity at the turn of the year should provide the opportunity to maintain progress. Balance Sheet and Cash Flow The full benefits of our restructuring are now apparent, with major reductions in fixed and working capital flowing into dramatically reduced borrowings. This provides ample financing for the future growth of the business, and will lead to even lower interest costs in 2003. In November 2002 the net borrowings of the group were revised to include a US dollar denominated loan which provides a hedge against US dollar linked assets held in Asia. This provided a benefit of #0.12m to reserves in 2002 and is expected to largely eliminate further exposure in 2003. Pensions During the year the two principal defined benefit schemes, which have been closed to new entrants since 1996, were combined, and a triennial actuarial review was carried out as at 7 April 2002. The resulting charge to profit and loss account was #0.20 million of normal contributions for the full year and a further #0.26 million of additional contributions (representing nine months) to reflect the accumulated deficit. This compares to a net pension credit of #0.11 million in 2001, and the full cost has been expensed against continuing activities. Current trading and prospects Sales for the current year to date at Stadium Asia are substantially higher than the corresponding period last year, and the order book is at a high level. Operations in the UK remain under some pressure, but are trading at levels comparable with last year. The rate of new business coming into Asia, and the potential yet to be realised in the domestic Chinese market, give us confidence both in the short and long term future of the group. Nigel Rogers Chief Executive 25 February 2003 CONSOLIDATED PROFIT AND LOSS ACCOUNT for the year ended 31 December 2002 Discontinued, exceptional Total Total Continuing Items & 2002 2001 pre-exceptional Goodwill Unaudited Items & Goodwill Amortisation #'000 #'000 #'000 #'000 Turnover Continuing operations 35,375 - 35,375 34,131 Discontinued operations - 8,482 8,482 41,606 35,375 8,482 43,857 75,737 Cost of sales (28,229) (7,837) (36,066) (63,604) Gross profit 7,146 645 7,791 12,133 Net operating expenses (5,658) (1,011) (6,669) (10,544) Exceptional items - (1,341) (1,341) (3,426) Goodwill amortisation & impairment - (132) (132) (3,771) Total net operating expenses (5,658) (2,484) (8,142) (17,741) Continuing operations 1,488 (132) 1,356 194 Discontinued operations - (1,707) (1,707) (5,802) Operating (loss)/profit 1,488 (1,839) (351) (5,608) Exceptional losses (772) (3,027) Interest payable (267) (939) Loss on ordinary activities before taxation (1,390) (9,574) Taxation 551 1,595 Loss for the financial year (839) (7,979) Dividends (790) (790) Retained loss for the year (1,629) (8,769) Earnings per share from continuing activities before goodwill, amortisation and exceptional items 4.0p 1.9p Basic Diluted 4.0p 1.9p Loss per share Basic (3.0p) (28.3)p Diluted (3.0p) (28.3)p GROUP BALANCE SHEET as at 31 December 2002 2002 2001 #'000 #'000 Fixed assets Intangible assets 933 1,067 Tangible assets 11,194 15,447 12,127 16,514 Current assets Stocks 4,128 8,898 Debtors due after more than one year 1,278 279 Debtors due within one year 7,755 14,166 Cash 590 623 13,751 23,966 Creditors: amounts falling due within one year Bank overdrafts (1,035) (966) Creditors (8,606) (16,365) ( 9,641) (17,331) Net current assets 4,110 6,635 Total assets less current liabilities 16,237 23,149 Creditors: amounts falling due after more than one year (3,459) (8,995) Provisions for liabilities and charges (150) (858) 12,628 13,296 Capital and reserves Called up equity share capital 1,411 1,411 Share premium account 4,032 4,032 Capital redemption reserve 88 88 Merger reserve 2,751 2,751 Profit and loss account 4,346 5,014 Equity shareholders' funds 12,628 13,296 Bank borrowings (net) 4,525 11,094 Gearing 36% 83% CONSOLIDATED CASH FLOW STATEMENT for the year ended 31 December 2002 2002 2001 #'000 #'000 Net cash inflow from operating activities 815 3,591 Servicing of finance (267) (938) Tax received/(paid) 285 (465) Capital expenditure Purchase of tangible fixed assets (732) (1,146) Sale of tangible fixed assets 1,936 1,955 1,204 809 Disposals Proceeds from sale of businesses 4,952 2,547 Deferred consideration 316 - 5,268 2,547 Equity dividends paid (790) (1,312) Net cash inflow before financing 6,515 4,232 Financing Loans repaid (6,555) (3,878) Net cash outflow from financing (6,555) (3,878) (Decrease)/increase in cash (40) 354 NOTES: 1. Segmental Analysis Exceptional 2002 Exceptional 2001 Continuing Discontinued and goodwill Total Continuing Discontinued and goodwill Total #000's #000's #000's #000's #000's #000's #000's #000's Turnover Electronics 25,486 1,435 - 26,921 24,222 4,752 - 28,974 Plastics 9,889 5,560 - 15,449 9,909 25,764 - 35,673 Other - 1,487 - 1,487 - 11,090 - 11,090 activities Total 35,375 8,482 - 43,857 34,131 41,606 - 75,737 Operating profit/ (loss) Electronics 799 (174) (762) (137) 295 (117) (5,924) (5,746) Plastics 922 (26) - 896 828 179 (55) 952 Other - (166) (453) (619) (91) 593 (497) 5 activities Group (233) - (258) (491) (98) - (721) (819) adjustments Total 1,488 (366) (1,473) (351) 934 655 (7,197) (5,608) Net assets Electronics 5,389 31 - 5,420 6,882 751 - 7,633 Plastics 3,680 - - 3,680 4,277 6,229 - 10,506 Other - 84 - 84 779 698 - 1,477 activities Group 3,444 - - 3,444 (6,320) - - (6,320) adjustments Total 12,513 115 - 12,628 5,618 7,678 - 13,296 The analysis of Electronics between continuing and discontinued reflects the fact that closure or disposal of these businesses was part of the wider strategic review to focus the Group on the EMS market, with a reduction in the UK manufacturing capacity. Prior to this these businesses were a material part of the Electronics division. 2. Exceptional Costs in Operating Expenses 2002 2001 #'000 #'000 Redundancy costs (565) (1,115) Asset impairments & stock provisions (518) (1,635) Other closure costs (258) (676) Goodwill impairment & amortisation - (3,771) (1,341) (7,197) 3. Exceptional Gains/(Losses) 2002 2001 #'000 #'000 Gain on sale of properties 1,082 - Impairment to Plastics division fixed assets - (2,500) Loss on sale of subsidiaries (1,854) (527) (772) (3,027) 4. (Loss)/earnings per share The calculation of basic loss per share is based on the loss for the financial year of #839,000 (2001 : (#7,979,000)) and the weighted average number of ordinary shares in issue during the year of 28,212,198 (2001 : 28,212,198). Diluted earnings per share reflect options granted resulting in a weighted average number of 28,212,198 ordinary shares (2001 : 28,212,198). The reconciliation of basic earnings per share to earnings per share excluding exceptional items and goodwill amortisation is as follows: 2002 2001 Earnings per share (before goodwill and exceptional items) 4.0p 1.9p Discontinued activities (1.3)p 0.0p Exceptional items (5.2)p (16.8)p Goodwill amortisation and impairment (0.5)p (13.4)p Basic loss per share (3.0)p (28.3)p 5. Dividends The proposed final dividend of 1.85 pence per share will cost #522,000 and will be payable on 5 May 2003 to shareholders on the register on 4 April 2003. 6. Net Cash Inflow from Operating Activities 2002 2001 #'000 #'000 Operating loss (351) (5,608) Release of grants received (67) (68) Goodwill amortisation 132 3,771 Depreciation 1,379 3,434 Loss on sale of tangible fixed assets 25 243 Decrease in stocks 1,269 2,920 Increase in debtors (425) (1,425) (Decrease)/Increase in creditors (1,147) 324 Net cash inflow from operating activities 815 3,591 7. Analysis of Changes in Net Debt 2001 Cash Flow Exch Diffs 2002 #'000 #'000 #''000 #'000 Cash 623 29 (62) 590 Bank overdrafts (966) (69) - (1,035) (343) (40) (62) (445) Loans due within one year (2,114) 1,314 - (800) Loans due after one year (8,637) 5,241 116 (3,280) (11,094) 6,515 54 (4,525) 8. Financial Information The un-audited financial information set out above does not constitute the Group's statutory accounts. Statutory accounts for the year ended 31 December 2001 have been delivered to the Registrar of Companies. Statutory accounts for the year ended 31 December 2002 will be delivered to the Registrar of Companies following the Annual General Meeting. 9. Annual Report & Financial Statements The Annual Report and Financial Statements will be posted to shareholders shortly. The Annual General Meeting will be on Monday 28 April 2003 at 5 Giltspur Street, London EC1. Copies of the Annual Report and of this announcement will be available at the Company's registered office: Stephen House, Brenda Road, Hartlepool, TS25 2BQ. This information is provided by RNS The company news service from the London Stock Exchange END FR TIMPTMMJTBMJ
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