We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Register for Free to get streaming real-time quotes, interactive charts, live options flow, and more.
| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Swp Grp. | LSE:SWP | London | Ordinary Share | GB00B010NX28 | ORD 0.5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 8.75 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
Hot Features
Premium
RNS Number:5426V
SWP Group PLC
13 December 2005
SWP Group PLC
Preliminary results for the year ended 30 June 2005
CHAIRMAN'S STATEMENT
Corporate Review
The year which ended on 30 June 2005 was essentially one of consolidation. In
the wake of the disastrous results of the previous year, our management teams
were charged with the task of reviewing both their business plans and the shape
and structure of their organisations and although we must report a further loss
for the year as a whole, the scale of it is greatly reduced.
Turnover for the year as a whole increased by 6.7% but it is noteworthy that in
the second half of the year sales were 15.3% ahead of the corresponding period a
year earlier. More importantly, however, each of our subsidiaries is now
carrying significantly lower overhead costs than has been the case and they are
all now in a better position to compete in markets where, despite widespread
media comment about the increasing prevalence of partnering arrangements based
on life-cycle costs and service levels, price is still of critical importance in
the decision-making process.
We are also pleased to report that on the basis of recent independent valuations
of the Group's property assets the Directors have increased the value of
properties by #828,000 which provides significant additional substance to our
balance sheet.
Results
For the year to 30 June 2005 the Group recorded an overall loss of #521,000
(2004: #2,717,000) on sales of #16,007,000 (2004: #15,006,000). At the operating
level the loss was #325,000 (2004: #1,816,000) but this was offset by
exceptional net operating income of #373,000 (2004: #292,000 cost) arising from
the legal action which we had initiated in relation to the acquisition of DRC
Polymer Products. Net interest costs amounted to #569,000 (2004: #609,000).
Review of Operations
The Group continues to operate through three principal subsidiaries each of
which is a supplier of specialist products to the construction industry.
Fullflow Group, which is based in Sheffield and has subsidiary operations in
Paris, Madrid and Rotherham, designs, manufactures and installs rainwater
management systems with a particular emphasis on syphonic roof drainage systems
for large roofs. Through its Rotherham operation it also manufactures and
distributes pipework fittings and fabrications and related items to a wide range
of customers working mainly in the gas, water and petrochemical industries.
Crescent of Cambridge is based in St Ives, Cambridgeshire and is the UK's
leading manufacturer of spiral and other custom-built steel staircases. DRC
Polymer Products is based in Soham, Cambridgeshire and manufactures
polymer-based sheet materials for use in a wide variety of structural
waterproofing applications and other specialist markets such as fireproofing and
soundproofing.
Fullflow Group
Although Fullflow incurred further losses during the year under review much was
achieved in terms of reshaping and re-organising the company's four operations.
Clearly defined management structures were introduced, new sales policies
implemented, enhanced control procedures adopted and a more inclusive system of
decision-making applied throughout the company. The overall result of these
changes has been the emergence of a business which, at least in principle, is
far better placed than before to realise the potential which its market-leading
technology and many years of experience have created.
In the UK the first half of the year was spent dealing with the problems caused
by the scatter-gun sales strategy which had been in place previously and had
produced large numbers of small orders spread all over the country. This period
was characterised by inefficiencies and service failures but although there was
plenty of pain in financial terms Fullflow's reputation remained largely
unscathed meaning that no long-term relationships were affected. Thankfully the
second half of the year brought considerable efficiency improvements and a
return to the service levels on which Fullflow has built its reputation over the
years. As reported in our interim announcement average order values have
increased significantly and although the number of orders received has shown a
decline each order is now processed in a much more focused and organised way. At
a time when competitive pressures in the market are intensifying, Fullflow's
ability to achieve the highest possible standards of customer service has never
been so important.
As ever Fullflow has been involved in some of the country's most prestigious
projects. Passengers using Heathrow's new Terminal 5 when it opens will be
protected by a Fullflow rainwater system as will those spectators watching
Manchester United's home matches from the new seating areas in the corners of
Old Trafford. And although the last day of the recent Ashes series was badly
affected by rain those enjoying the spectacle from the eye-catching new stand at
the Vauxhall End stayed dry thanks to the Fullflow system which had been
installed towards the end of 2004.
In France things were much more difficult. Weak market conditions at the
beginning of the year, coupled with the emergence of an aggressive new
competitor, had a serious effect on order intake and although there was a marked
improvement in the second half of the year, margins remained under pressure with
the result that losses were incurred for a large part of the year, a situation
which was in stark contrast to the previous year when France had traded
profitably while the rest of Fullflow ran up heavy losses.
Against this background we have taken a long hard look at the medium and
long-term prospects for the French business and we have concluded that it is
likely to be very much in our interests to ride out what we regard as short-term
difficulties. In recent weeks order levels have strengthened considerably,
bolstered by a Euro700,000 project for car manufacturer Renault, and although there
remain a number of difficulties associated with organising and managing
installation teams across a country as large as France, we are confident that
the local management team have the necessary experience, technical expertise and
commitment to return the business to profit in the near future.
In Spain, significant progress was achieved in terms of sales growth but a
number of factors, including staff changes and labour problems, combined to
produce a disappointing financial result. However, action has been taken to
address these issues and we continue to see Spain as a market with major
potential. Enquiry levels continue to show a strong upward trend and there is a
growing stream of evidence to suggest that the majority of the main players in
the commercial and industrial sectors of Spain's construction industry now have
a preference for the Fullflow option. This positive momentum extends to other
sectors as well and we are now better placed than ever to take advantage of this
trend. For the first time ever it appears likely that at some stage in the
months ahead Fullflow sales in Continental Europe will exceed those in the UK.
Progress was also achieved at Plasflow, albeit at a slower pace than we had
hoped for. Although Plasflow provides an important manufacturing service to the
other Fullflow businesses it requires significant third party sales to realise
its full potential and much remains to be done in this respect. However,
following a period of lacklustre performance, business levels did improve in the
second half of the year and this trend has accelerated since the year-end. In
terms of quality, professionalism and efficiency, Plasflow has raised its
standards to new levels of excellence and this should ensure high levels of
customer retention in a market where service levels are of the utmost
importance.
Internationally there is little to report at this stage but we remain committed
to establishing partnering/franchising arrangements in a number of countries
where we believe there to be an opportunity for Fullflow to exploit its
intellectual property assets without exposing the Group to the risks associated
with establishing a direct presence.
Crescent of Cambridge
Following a disappointing year in 2004, Crescent bounced back strongly to record
a very satisfactory result during the year under review. Sales increased by
nearly 7% and the new CNC machines finally started to produce the cost savings
on which their purchase had been predicated.
Although Crescent is mainly known for its expertise and market-leading position
in the manufacture of spiral staircases, strenuous efforts have been made in
recent years to increase its share of the commercial and industrial market for
straight staircases, which has traditionally been served by a large number of
local suppliers, the majority of whom have a much lower cost base than does
Crescent. Until recently, these efforts had achieved only limited success but as
a result of an energetic and focused marketing campaign during the year Crescent
has managed to reach the point where straight stairs account for 35% of the
company's workload, meaning that it is now less reliant on the spirals market
the growth potential of which is likely to be limited.
On the cost side, significant savings have been made in the company's overhead
structure and with the year-end order book standing at an all-time record
Crescent is well-placed to achieve further progress in the current year.
DRC Polymer Products
Following a considerable period of decline, sales at DRC finally staged
something of a recovery, ending up at a level 15% higher than the previous year.
However, this improvement fell short of expectation and the result was yet
another loss for the year, although once again the level of loss was lower than
before.
Sales of roofing materials into the modular building market exhibited a marked
increase during the year and DRC has now re-established itself as the market
leader in this field. On the other hand sales of the special soundproofing
product once again fell well below the levels which had been anticipated by
DRC's customer.
Following a decision to exit the automotive sector, DRC's business is now
focused exclusively on the manufacture of a broad portfolio of products targeted
at the civil engineering, construction and petrochemical industries where its
role is often that of manufacturing partner for a product distributor. During
the year progress was made in relation to a number of these arrangements and it
is pleasing to report that DRC's well-established expertise in materials
technology has enabled it to make a positive contribution to the task of
ensuring that the materials which it manufactures remain competitively priced in
the global markets which they serve.
Two new products were brought to market during the last quarter of the year,
firstly a roof membrane suitable for use in both adhered and mechanically-fixed
applications and secondly a lining material for a branded pre-fabricated
guttering system. Both products are being distributed by market leaders in their
respective sectors and both are regarded as having considerable potential.
One notable exception to these partnering arrangements is the material which we
referred to in last year's Report as the "Intelligent Membrane". This material,
which DRC now markets under the brand name "Hylam IQ" is a loose-laid membrane
used to line reservoir roofs. The advantages of loose-laid systems for such
applications, particularly in terms of cost, are well known but they have often
been overshadowed by concerns over long-term integrity and the difficulty of
locating the source of any leaks. However, based on the use of a network of
sensors and a sophisticated built-in system of interrogating, detecting and
mapping changes in the relationship between these sensors, Hylam IQ enables any
damage to the membrane to be pinpointed to within a very small area of the
overall installation.
This product has been developed over a number of years and its introduction to
the market has been eagerly anticipated for some time. The first commercial
installation took place in January at the Demings Moss reservoir near Haweswater
in Cumbria, and it is fair to say that the weather and ground conditions meant
that this test was as demanding as it was possible to be. However, all went
entirely to plan and the customer - United Utilities - was suitably impressed
with the result. It would simply not have been possible for a lining based on
the use of liquid coatings to have been installed at that time of year.
The system is now being actively marketed to a wider audience and is already
attracting significant interest both in the UK and internationally and we
believe that its potential is considerable. Indeed it has already been specified
on several forthcoming projects in the UK water industry and should provide the
basis of significant additional turnover for DRC in the current year and beyond.
Finance
As mentioned in the Corporate Review we commissioned a revaluation of the
Group's property assets during the year the result of which has been an increase
of #828,000 to the values reflected in our balance sheet and a corresponding
increase in net assets.
At 30 June our net bank borrowings amounted to #7,004,000, which was well within
the limits agreed with our Bankers whose support we continue to enjoy.
As is clear from Note 12 to the Financial Statements we maintained our pledge to
restrict capital expenditure to the bare minimum and in principle we remain
committed to this regime. However, should a situation arise where a relatively
modest investment would provide a significant short-term payback we are sure
shareholders would want us to grasp the nettle.
Litigation
No litigation of a material nature is either in process or pending.
Employees
Your company's greatest asset is its employees and once again we thank them on
your behalf for their commitment, resourcefulness and energy. Wherever possible
it is our policy to promote from within and we are pleased that during the year
we have been able to apply this policy in a number of instances. We will
continue to seek to provide career-enhancing opportunities for those employees
who are ready and willing to respond to the challenges involved.
Current Trading
We are pleased to report that all three of our subsidiaries have enjoyed a
significantly better start to the current year than to the previous one.
Crescent in particular has produced a very strong result in the first quarter
and Fullflow's UK businesses have also performed very creditably. DRC has
finally reached break-even point and after years of losses this represents a
very welcome turn of events. Disappointingly Fullflow's French and Spanish
businesses continue to register losses but as we comment below there is every
reason to believe that these losses will not last for much longer.
Future prospects
In light of past disappointments we are somewhat reluctant to express overly
optimistic sentiments under this heading.
However, there are a number of genuine reasons for us to look to the future with
confidence. In particular order intake in recent months has generally been very
buoyant: in both France and Spain Fullflow's order intake has already exceeded
the levels achieved in the whole of the previous year and Plasflow's third party
sales have at long last reached a significantly higher level which we believe to
be sustainable.
Crescent's order intake has also remained strong and we are extremely pleased by
the response of Crescent's management team to the challenge which we set them of
instilling new momentum into their business.
At DRC, progress continues to be made and if, both in the UK and abroad, demand
for the ground-breaking Hylam IQ reaches the levels which we regard as possible,
then the rate of progress ought to accelerate very rapidly.
Just as importantly costs remain under close control in all of our businesses
meaning that we retain more of the sales margins which we generate and also that
we can be more competitive on the pricing front when necessary.
In last year's report we stated that the future of the Group would be shaped by
the success which we achieve in generating revenue growth. At least at present
all the evidence suggests that our sales teams are making good progress on this
front and against this background we feel justified in expressing an optimistic
view of our prospects for the current year and beyond.
Board of Directors
Shareholders will be aware that for some time I have been planning to retire
from the Group as Non-executive Chairman. However, as a Board of Directors we
have been ruthlessly determined to turn around the fortunes of the Group and I
have been keen to oversee this process and to ensure delivery. Significant
progress has been made since our refinancing in May 2004 and I am confident that
the potential of each of the operating subsidiaries to achieve enhanced
profitability on the back of record order books has never been better. Alan
Walker, who has a considerable amount of public company experience and who
played a pivotal role in the refinancing and restructuring of the Group's
finances will succeed me, albeit in the capacity of Executive Chairman. He in
turn will be replaced by David Pett as Group Financial Director in addition to
his present role as Company Secretary.
The Board is in the process of recruiting a new Non-executive Director and
intends to invite a member of the Bell family, who are the Group's largest
shareholders, to join the Board with a view to further developing the Group's
profitable organic growth.
I would also like to express my thanks on your behalf to my fellow Directors,
Alan Smith and Alan Walker, for their efforts during the year. As promised in
last year's report both of them are working without remuneration and there can
be few public companies where such a situation prevails.
Finally I would draw your attention to the forthcoming Annual General Meeting
which is scheduled to be held in London on 24th January 2006. In the past this
meeting has not been especially well attended and we hope that more shareholders
than before will elect to come to this year's meeting and express their opinions
to us. We would actively welcome some engagement with those of you who have
chosen to invest in our Company.
R M Muddimer
Chairman
12th December 2005
Consolidated Profit and Loss Account
Year ended 30 June 2005 2005 2004
Notes #'000 #'000
Turnover 2 16,007 15,006
Cost of sales (10,591) (9,806)
-------- --------
Gross profit 5,416 5,200
-------- --------
Administrative expenses before (5,741) (7,016)
exceptional items
Exceptional items 373 (292)
-------- --------
Total administrative expenses (5,368) (7,308)
-------- --------
-------- --------
Operating loss before exceptional items (325) (1,816)
Exceptional items 3 373 (292)
-------- --------
Total operating profit / (loss) 48 (2,108)
Interest receivable 2 3
Interest payable and similar charges (571) (612)
-------- --------
Loss on ordinary activities before 2 (521) (2,717)
taxation
Taxation on loss on ordinary activities - -
-------- --------
Loss on ordinary activities after (521) (2,717)
taxation being loss for the financial ======== ========
year
Basic loss per share (pence) 4 (3.30)p (0.70)p
======== ========
Diluted loss per share (pence) 4 (3.30)p (0.70)p
======== ========
The results are wholly derived from continuing operations in both years.
Statement of Total Recognised Gains and Losses
Year ended 30 June 2005
The Group
2005 2004
#'000 #'000
Loss for the financial year (521) (2,717)
Revaluation of fixed assets 828 -
-------- --------
Total profit / (losses) recognised since last 307 (2,717)
annual report -------- --------
Note of Historical Cost Profit and Losses
Year ended 30 June 2005
The Group
2005 2004
#'000 #'000
Loss on ordinary activities before taxation (501) (2,717)
Difference between a historical cost depreciation 20 20
charge and the actual depreciation charge of the -------- --------
year calculated on the revalued amount
Historical cost loss on ordinary activities before (481) (2,697)
taxation ======== ========
Historical cost loss for the financial year (481) (2,697)
======== ========
Reconciliation of Movements in Shareholders' Funds
Year ended 30 June 2005
The Group
2005 2004
#'000 #'000
Loss for the financial year (521) (2,717)
Revaluation of fixed assets 828 -
New share capital subscribed, net of expenses - 3,091
-------- --------
Net increase to shareholders' funds 307 374
Opening shareholders' funds 557 183
-------- --------
Closing shareholders' funds 864 557
-------- --------
Consolidated Balance Sheet
At 30 June 2005 2005 2004
#'000 #'000 #'000 #'000
Fixed assets
Intangible assets 19 27
Tangible assets 4,423 3,906
-------- --------
4,442 3,933
Current assets
Stocks 2,829 2,731
-------- ------- -------- --------
Debtors falling due within one 5,482 4,766
year
Debtors falling due after more 337 249
than one year -------- ------- -------- --------
Total debtors 5,819 5,015
-------- --------
8,648 7,746
Creditors: amounts falling due (9,123) (7,888)
within one year -------- --------
Net current liabilities (475) (142)
------- --------
Total assets less current 3,967 3,791
liabilities ======= ========
Financed by:
Creditors: amounts falling due 3,306 3,437
after more than one year
Provision for liabilities and (203) (203)
charges
Capital and reserves
Called up share capital 79 79
Share premium account 11,134 11,134
Capital reserve 41 41
Revaluation reserve 1,479 671
Profit and loss account (11,869) (11,368)
-------- --------
Equity shareholders' funds 864 557
------- --------
3,967 3,791
======= ========
The financial statements were approved by the Board of Directors on 12th
December 2005 and were signed on its behalf by
J.A.F. Walker
Director of Finance
Consolidated Cash Flow Statement
Year ended 30 June 2005
2005 2004
Notes #'000 #'000 #'000 #'000
Net cash outflow from operating 5(a) (614) (224)
activities
Returns on investments and servicing
of finance
Interest received 2 3
Bank and loan interest paid (476) (487)
Hire purchase interest (37) (51)
------- -------
(511) (535)
Capital expenditure and financial
investment
Payments to acquire tangible fixed (110) (179)
assets
Payments to acquire intangible fixed (5) (13)
assets
Receipts from sales of tangible 20 144
fixed assets ------- -------
(95) (48)
------- -------
Net cash outflow before financing
Financing (1,220) (807)
Issue of ordinary share capital net - 3,091
of expenses
Bank loans received - 129
Bank loan repayments (129) (250)
Other loan repayments - (1,046)
Capital element of finance lease and (260) (327)
hire purchase payments ------- -------
(389) 1,597
------- -------
(Decrease) / Increase in cash after 5(b) (1,609) 790
financing ======= =======
Parent Company's Balance Sheet
At 30 June 2005 2005 2004
#'000 #'000 #'000 #'000
Fixed assets
Tangible assets 1,120 625
Investments 8,151 8,151
------- -------
9,271 8,776
Current assets
Debtors 7,691 6,712
Creditors: amounts falling due within (4,466) (3,678)
one year ------- -------
Net current assets 3,225 3,034
------ ------
Total assets less current liabilities 12,496 11,810
------ ------
Financed by:
Creditors: amounts falling due after 2,925 2,925
more than one year
Capital and reserves
Called up share capital 79 79
Share premium account 11,134 11,134
Revaluation revenue 500 -
Profit and loss account (2,142) (2,328)
------- -------
Equity shareholders' funds 9,571 8,885
------ ------
12,496 11,810
====== ======
The financial statements were approved by the Board of Directors on 12th
December 2005 and signed on its behalf by
J.A.F. Walker
Director of Finance
Notes to the Financial Statements
1. ACCOUNTING POLICIES
The following accounting policies have been applied consistently in dealing
with items which are considered material in relation to the Group's
financial statements.
Basis of preparation
The financial statements have been prepared in accordance with applicable
accounting standards and under the historical cost accounting rules
modified to include the revaluation of certain fixed assets.
2. SEGMENTAL ANALYSIS BY CLASS OF BUSINESS
The analysis by class of business of the Group turnover, result before
taxation and net assets is set out below:
2005 2004
Profit/ Profit/
(loss) (loss)
Turn- before Net Turn- before Net
over taxation assets over taxation assets
#'000 #'000 #'000 #'000 #'000 #'000
Syphonic drainage 9,193 (438) 74 8,809 (1,535) (646)
Staircases 3,826 267 1,334 3,632 94 1,240
Polymer sheet 2,988 (122) (125) 2,565 (252) 55
materials
------- -------- ------- ------- ------- -------
16,007 (293) 1,283 15,006 (1,693) 649
------- -------
Operating exceptional 373 (292)
income (costs)
Other charges/ (32) (419) (123) (92)
liabilities -------- -------
Profit/(loss) before 48 (2,108)
interest
Net interest payable (569) (609)
-------- -------
Loss before taxation (521) (2,717)
-------- ------- ------- -------
Total net assets 864 557
======= =======
The Group operates predominantly within the United Kingdom. The geographical
analysis of the Group's turnover by destination is as follows:-
2005 2004
#'000 #'000
United Kingdom 12,962 10,019
Europe 3,009 4,848
North America - 72
Far East - 45
Africa and Middle East 36 22
------- --------
16,007 15,006
------- --------
3. EXCEPTIONAL ITEMS
Exceptional items comprise the following:
2005 2004
#'000 #'000
Direct costs and legal expenses in respect of - (96)
the litigation with the principal vendor of DRC
Holdings Ltd
Net proceeds from litigation against Group's 373 -
former advisors
Rationalisation costs in respect of Fullflow's - (142)
activities in UK, France and Spain
Legal costs in respect of termination of agency - (54)
agreement ------- --------
373 (292)
======= ========
4. LOSS PER SHARE
The loss per share calculation for the year ended 30 June 2005 is based on
the weighted average of 15,769,546 (2004: 386,523,706) ordinary shares in
issue during the year and the loss of #521,000 (2004: loss of #2,717,000).
The company's share options are not dilutive for loss per share
calculations.
5. NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
(a) Reconciliation of operating profit to net cash inflow/(outflow)
from operating activities
2005 2004
#'000 #'000
Operating profit / (loss) 48 (2,108)
Depreciation charges 473 569
Amortisation of trade names and patents 13 15
(Profit)/loss on sale of tangible fixed assets (11) 8
Increase in stocks (98) (87)
(Increase)/decrease in debtors (804) 459
(Decrease)/increase in creditors (235) 920
------- --------
(614) (224)
======= ========
(b) Reconciliation of net cash flow to movement in net debt
2005 2004
#'000 #'000
(Decrease) / increase in cash in period (1,609) 790
Cash outflow from increase in debt and lease 389 448
financing ------- --------
Change in net debt resulting from cash flows (1,220) 1,238
New finance leases (61) (36)
------- --------
Movement in net debt in period (1,281) 1,202
Net debt at 30 June 2004 (5,956) (7,158)
------- --------
Net debt at 30 June 2005 (7,237) (5,956)
======= ========
(c) Analysis of net debt
At 30 Non At 30
June Cash cash June
2004 Flow changes 2005
#'000 #'000 #'000 #'000
Overdrafts (2,145) (1,609) - (3,754)
Debt due within one year (129) 129 - -
Debt due after one year (3,250) - - (3,250)
Finance leases and hire (432) 260 (61) (233)
purchase -------- ------- ------- --------
Total (5,956) (1,220) (61) (7,237)
======== ======= ======= ========
The 2005 figures have been abridged from the audited statutory accounts for the
year which will be posted to shareholders on 19thDecember 2005. The figures for
2004 have been abridged from the audited statutory accounts for that year which
have been delivered to the Registrar of Companies. The reports of the auditor on
the statutory accounts were unqualified. Further copies of the accounts are
available from the Company's registered office at SWP Group plc, 4th Floor
Bedford House, 3 Bedford Street, London WC2E 9HD.
For further information or enquiries please contact:
J A F Walker
Director of Finance
Tel Office: 020 7379 7181
Mobile: 07900 445623
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR BRBDDCBBGGUD
1 Year SWP Group Chart |
1 Month SWP Group Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
