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| 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 |
From Jul 2019 to Jul 2024
TIDMSWP
RNS Number : 1009V
SWP Group PLC
10 December 2013
SWP Group Plc
("SWP" or the "Group")
Final Results for the year ended 30 June 2013
SWP Group (AIM: SWP), the industrial engineering group, is pleased to announce its final results for the year ended 30 June 2013.
Financial Highlights
n Borrowings reduced by 26.6% at 30(th) June 2013 and significant reduction in period to 31(st) December 2013 in pipeline.
n Gross margins increased by 5.2% due to combination of operating effectiveness, risk management and maintained business practices.
n Earnings decline due to losses from Fullflow in Spain and Crescent.
n Losses before discontinued operations GBP0.356M (2012 profit GBP0.608m).
n Group sales (excluding Fullflow Spain) declined by 31.5% to GBP14.317M (2012 GBP20.922M).
n Fullflow in Spain together with associated redundancy costs and property revaluations following the triennial review account for the exceptional costs of GBP0.821M and losses from discontinued operations of GBP0.543M.
n Dividend maintained at 0.075p per share (2012 - 0.075p per share) demonstrating the Board's confidence in results going forward.
Operational Highlights
n Rigorous cost management throughout all operating units.
n Fullflow business in Spain closed thereby eliminating losses and unsustainable levels of overhead.
n International development for both Ulva and Fullflow progressing according to plan.
n Research and development at both Ulva and Fullflow increasing pace in line with product development plans.
n Significant improvement to order books across the Group post year end in line with uplift in market conditions.
Alan Walker, Executive Chairman, commented:
"With this year of transition now consigned to history Group management is implementing key initiatives and development plans designed to promote our brands in the home market and internationally. The stronger economic outlook has allowed order books in our various businesses to recover and provides the stimulus for improved levels of profitability going forward."
Chairman's Statement
Corporate Review
The year under review to 30(th) June 2013 has been a difficult one for the Group as a whole. The continuing economic gloom which has been prevalent over the construction sector for some years forced us to address the deepening implosion within the Spanish market and led to the closure of Fullflow's business activities in Madrid.
At the interim stage I advised shareholders of the difficulties we were experiencing in Spain and that the incidence of bad debt, poor margins and demands for credit periods of upwards of 180 days often without the benefit of commercial credit insurance meant that we could no longer support a high overhead base in Madrid. In essence the Spanish business lacked viability and its closure allows the Fullflow Group to move forward from this year of transition to embrace improving market conditions in the key areas in which we wish to concentrate our efforts and where we believe potential for growth is best suited to our strategic ambitions now and in the future.
The downturn within the construction sector has been particularly harsh to both Fullflow and Crescent. Fortunately, market conditions have improved significantly across the board since the year end as growth appears to be returning allowing order books to recover as confidence is once again restored.
Business Review
In recent years much of our energy and focus has been expended on dealing with the impact of the severe effects of the global economic recession on our businesses. In particular we have had to implement a number of cost reduction programmes often with painful consequences and we have developed enhanced risk assessment procedures which will hopefully deliver benefits in good times as well as bad.
Now that the economic environment is at last showing signs of improvement, we are once again turning our focus to the twin aspirations of quality and innovation, which we believe are critical to our ambition to deliver profitable growth in each of our businesses. Particularly in the case of Ulva, specification is perceived to be a key element in the enhancement of our relationships with key customers and product development and innovation will play an increasingly important role in ensuring that we differentiate our product offering to discerning and demanding customers who are looking for value backed solutions where longevity and durability will provide confidence that the assets we are engaged to protect will remain fully protected in line with expectations. Competitive advantage will be important as markets mature in line with technical advancement.
Ulva is the leading supplier of polymer based engineering solutions of CUI management (Corrosion Under Insulation) to the oil, gas and petrochemical industries. The geographical spread of Ulva's customer base continues to grow. Ulva put in a solid performance in the year to 30(th) June 2013 but fell somewhat short of our expectations if only because a major supply contract was delayed from Q4 of the year until Q2 of the current financial year. Whilst this may have had a deleterious effect on both turnover and profits for the year to 30(th) June 2013 it has had a highly positive impact in the current financial year and restores Ulva to where management expectations for the business have been for some time. Many challenges remain for our experienced and capable team at Ulva whose ambitions for growth and continued success are demonstrable.
A key capital expenditure programme is in the course of delivery at Ulva. Your Board approved a capital project for GBP1.6M earlier in the year which is designed to install a state of the art production line at Telford which will significantly improve the operating efficiencies under which UlvaShield and other associated products will be manufactured. We anticipate that the new line will commence production in Q1 of 2014 and will provide Ulva with sufficient operating capacity to satisfy our growth requirements for the next decade. The project which has been led by Ulva's Technical Director, Peter Grkinic, is about to enter its installation phase, is on time, to specification and on budget. We look forward to reporting further to shareholders in future reports the benefits which will accrue from this project.
At the same time there is as I have referred to above an appetite for product innovation and diversification. Ulva is working on other development projects which are designed to increase the range of Ulva's product offering in line with our reputation for product quality and durability in ever changing markets.
Key senior management appointments have been made to the Ulva team in both the United States and Far East which will be crucial in the onwards and upwards development of our international business as well as our ability to service our existing valued customers in these important regions.
Fullflow remains a market leader in the supply of rainwater management systems to a wide range of UK and an increasing number of international customers who have learned to appreciate the advantages of syphonic roof drainage as systems of choice to drain large scale areas of roof and/or complex buildings where the need for technical solutions can be engineered to cope with anticipated levels of rain intensity. We live in an age when global weather conditions vary considerably with greater levels of rainfall intensity and the unpredictable nature of climatic weather conditions can be very volatile. Fullflow, as a Group, experienced a difficult year and for once was loss making overall due to the exceptional costs associated with the closure of Madrid. That said, considerable progress was made by Fullflow Systeme in France where, unlike in the UK, they secured a number of large infrastructure projects which continue to sustain and augment recent contract awards in the current financial year.
The UK construction sector has experienced depressed levels of demand and a lack of major infrastructure projects at a time when we had chosen to chart a cautious route through the recession based on risk management during a period of management change. Fortunately in the new financial year as the UK has emerged from recession Fullflow's order book has been revitalised with the average order size moving significantly upwards. We expect this improvement to continue.
As with Ulva there is a need for technical innovation in the syphonic drainage business and Fullflow has been working on new and improved methods associated with installation which it is hoped will feature in Fullflow's product offering in 2014. These are designed to improve operating efficiencies on site and assist productivity in terms of the speed of installation. It is only in recent times that Fullflow has embarked on expanding its brand presence internationally. Whilst we have transacted a number of international projects over the past few years it is only now that Fullflow International Limited has been established and resourced with the objective of promoting brand penetration in a number of selected territories. This has led to project awards in Norway, Finland and Morocco as well as design and supply assignments in Singapore and Korea. In addition, discussions continue to take place with potential strategic partners in North and South America, the objective of which is to promote the brand and technical expertise of Fullflow to its best possible advantage alongside local partners who have experience of the local economy, labour and business practices. This is likely to feature as a cornerstone strategy for the development of Fullflow in the future.
Plasflow operates as part of the Fullflow Group and is not only a key supplier to Fullflow's fabrication needs but a supplier of pipe solutions in its own right to third party customers from its impressive pipe welding facility in Rotherham. Whilst Plasflow did not achieve the success of one year earlier when it reported record profits its performance in the year to 30(th) June 2013 was commendable against the background of the timing associated with major projects in the utilities sector. Plasflow enjoys strong relationships with the UK nuclear industry and its technically driven solutions are to be found at most of the nuclear plants in this country. These valuable relationships provide Plasflow with a competitive advantage and it is envisaged that on a project by project basis nuclear related business will play a major part in Plasflow's future business model.
Crescent was unable to sustain the return to profitability it managed to achieve in 2012 and reported disappointing results in the year to 30(th) June 2013. This arose from a lack of demand in difficult market conditions. As a respected provider of bespoke spiral, helical and straight metal staircases Crescent has performed well for the Group in the past. Whilst the activities at Crescent are on the periphery of the Group's core businesses at Ulva and Fullflow it remains our firm belief that now that market conditions are once again improving Crescent can remain in the forefront of this specialist niche market with increasing levels of orders coming from London and the Home Counties. Resources will be made available to Crescent to improve and refine its computer aided design techniques as well as increasing the design and production capability in line with increasing levels of demand. Significantly improved results are expected in the current year.
Results
Sales for the year to 30(th) June 2013 have fallen for the reasons explained above to GBP14.317M (2012 GBP20.922M) due to lower activity levels in all businesses but in particular at Fullflow in Spain, the results of which have been eliminated from these numbers and reclassified as a discontinued business.
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2013 2012
GBP'000 GBP'000
Turnover 14,317 20,922
Operating (loss)/profit (after exceptional
expenses) (267) 1,119
(Loss)/profit before tax from continuing
operations (454) 835
Earnings (loss) per share (0.44p) 0.30p
========== =============
The results for the year have been negatively impacted by the losses and exceptional costs arising largely from the closure of Fullflow Sistemas. These amount to GBP543,000 and GBP821,000 respectively and will not recur in future.
Lower levels of financial interest GBP187K (2012: GBP284K) and taxation of GBP98K credit (2012: GBP227K expense) help to restrict the loss attributable to shareholders to GBP899K (2012: profit GBP608K).
Earnings per share amount to (0.44p) as compared to 0.30p in 2012.
As shareholders are aware the Liquidator of Ulva Ltd has now paid out 100p/GBP in respect of DRC's entitlement to dividends in support of its debt claims. Further monies are in the course of realisation by the Liquidator which he has advised will be repaid to SWP Group plc. under the terms of an Asset Purchase Agreement dated 28(th) November 2007. This remains as a contingent asset which is not recognised in these financial statements and will be recovered in the fullness of time as and when the Liquidator discharges his obligations under the agreement.
Borrowings
As has been pointed out in earlier years one of SWP's foremost objectives has been the retirement of bank debt. Notwithstanding the disappointing results recorded in the year to 30(th) June 2013, regarded as a year of transition whilst we focus almost entirely on the development of our core Ulva and Fullflow brands, we have generated cash from operating activities amounting to GBP1,389K (2012: GBP1,210K) which has funded the repayment of bank loans, deposits towards Ulva's capital expenditure programme and a dividend to shareholders. Bank debt at 30(th) June 2013 has fallen to GBP2.334M (2012: GBP3.180M) or by 26.6% which is consistent with earlier years when the Group was more profitable. Significantly, cash receipts post 30(th) June 2013 and funds anticipated from settlements in our favour of Irrevocable Letters of Credit allow us to predict that debt by 31(st) December 2013 is likely to be less than GBP1.25M. We anticipate that bank debt will have been eliminated during 2014 and for the most part by the end of the current financial year to 30(th) June 2014. We consider this to be a major achievement given the backdrop of recession and the fragility of the markets in which we operate.
Shareholders would want to know that the new capital expenditure project currently being delivered at Ulva will be financed in part through the Group's existing resources and partly by lease finance arrangements over which security will be granted but confined to the machine itself post installation. The anticipated yield/payback is envisaged to be under 3 years from the date of installation.
The Group's Statement of Financial Position reflects a resilient and strong balance sheet with reduced working capital consistent with the prudent manner in which we have chartered our course through years of recession. The debt reduction plan will be rigorously seen through to its inevitable conclusion. A triennial review of our real estate assets by external valuers has resulted in GBP411K passing through the Consolidated Statement of Comprehensive Income under exceptional costs in order to comply with IAS16.
Dividend
In recent years it has been SWP's stated aim to maintain a progressive dividend policy. Notwithstanding the capital investment programme at Ulva and the commitment to eliminate bank debt in the near term your Board recommends the declaration of a maintained dividend of 0.075p per share (2012: 0.075p) as a measure of the confidence with which we view the Group's ability to deliver improved results in the year to 30(th) June 2014 and beyond.
Taxation
Attention is drawn to Note 9 of this Annual Report which provides a summary of the Group's overall tax position where we continue to benefit from the utilisation of losses carried forward and/or in the case of Crescent those generated in the course of the year under review.
There is no UK corporation tax due and in fact a refund of GBP73K to be paid for the year to 30(th) June 2013 (2012: expense GBP217K) and the amount of overseas tax to be paid (in France) amounts to GBP12K (2012: GBP1K). It should be noted that in line with UK Government policy the rate of Corporation Tax is due to fall incrementally year on year.
Research and Development
As mentioned above the Group's two principal businesses are committed to a number of research and development projects which are designed to improve operating efficiencies and to extend the range of products on offer to discerning customers in markets which are constantly changing. The UK Government is in effect sponsoring such innovation through the advent of R&D tax relief at enhanced rates which makes it all the more critical and advantageous that we innovate so as to stay at the forefront of our chosen market sectors from a technical and commercial point of view.
Corporate Governance
The Group is committed to the principles set out in the UK Corporate Governance Code. Whenever practical and to the extent that these relate to a business of our size we attempt to comply. The Remuneration and Audit Committees meet and/or discuss twice per annum whilst monthly management meetings at subsidiary level are enhanced by Group Board meetings on a quarterly basis or as required.
Strategy
The long and arduous recession has had a significant impact on our construction orientated businesses at both Crescent and Fullflow. We have navigated a prudent course of action which has allowed us to control costs against muted demand until such time as economic prosperity in the UK and further afield returns to normality.
In parallel we have seen our oil and gas brand at Ulva prosper and grow in terms of international appeal and regional market penetration. It is our intention to grow both of the Ulva and Fullflow brands internationally by further strengthening the strong and dedicated management teams to achieve this growth over time. These teams will continue to be enhanced and developed through the training programmes which have been introduced to allow senior managers to add to their management skills.
Focused efforts will be directed to the support of these two principal brands and to the considerable investment we have made in each of these in terms of financial, human and technical resources which place both in an ideal position to embrace the general improvement in market conditions now on offer. Further resources will be deployed to allow Crescent to achieve market leadership in the UK within its specialist areas of expertise where its well-earned reputation for design competence and ability to manufacture complex staircases will stand it in good stead in the future.
People
Considerable effort has been expended by our staff and employees during these turbulent and difficult market conditions. Long distances have been travelled to all corners of the world by many of our senior managers who have spent long trips away from their families in the desire to foster new relationships and the promotion of our brands in an increasing number of territories. To all of our hard working employees I wish to express on behalf of our Board our gratitude for the sacrifices which are made on a regular basis. We have a number of challenges in front of us but have the good fortune to own three exceptional brands which we cherish and which have enormous potential for the positive onward development of the Group.
Prospects
After a slow start to the new financial year in July 2013 considerable momentum has been created throughout the Group as a result of improved order books. At Fullflow in France we are ahead of budget, in the UK whilst behind budget the Fullflow UK order book is stronger than it has been at any time during the past three financial years. Plasflow is now delivering to the UK nuclear industry and our activities in Fullflow International are expanding with infrastructure projects in new territories.
Ulva is enjoying a strong period of trading having received its delayed order in Q2 of the current year. Management is highly focused on specification selling and the provision of site services to the major customers to whom Ulva sells insulation systems. The installation of Ulva's new process line will commence early in 2014 and this, along with the product development initiatives which are underway at Ulva, will allow the business to grow on the back of reliable product delivery and technical innovation.
The year to 30(th) June 2013 is now behind us albeit with disappointing results emanating from Fullflow in Spain and Crescent. The markets generally appear to have gained in confidence and the flow of orders is a most encouraging sign of progress. We anticipate a welcome return to growing each of our businesses and to the inevitable staffing and logistical issues that will arise after so many years of recession and stagnation. Whilst there will be many challenges to face there is equally considerable room for optimism that the quality of our brands will sustain profitable growth into the future.
Alan Walker
Chairman
Operational Review
Operating Review
For the year under review, three key issues have materially shaped the performance of the Group. The first was the delay in a significant portion of an on-going major project in Ulva; the second was the impact of extracting Fullflow from its substantial cost base and commitment in Spain whilst Crescent returned a poor performance in difficult market conditions.
The operating performance in the year is not in any way reflective of the value in the Fullflow and Ulva brands or the core competencies of the businesses.
The personal effectiveness of key recruits continues to be one of the significant factors in driving SWP forward. We have not been without some notable success in this area but there have been a number of disappointments along the way.
Crescent
Crescent endured very difficult market conditions for the whole of the period under review and ultimately was unable to secure enough business at high enough margins to reach break-even. The team has continued to design, manufacture and install quality stairs for a customer base that has predominantly comprised of major national contractors.
There is little opportunity to cut the cost base of Crescent further without beginning to lose the core competences of the business and turn-around is dependent upon recovery in the sector.
Post the year end, there have been signs that the not inconsiderable patience and financial investment in Crescent during the period of the last five years is about to be rewarded as the order book has swelled and encouragingly now contains projects with regional contractors and domestic projects. As the sector begins to recover, Crescent's brand, core skills and capabilities are intact and ready to serve increasing demand at the quality end of the market.
Fullflow
The Fullflow Group offers engineered to order turnkey solutions for the syphonic evacuation of rainwater from large roofs.
Fullflow Group's performance has been over-shadowed by the closure of its Spanish subsidiary following the almost complete collapse of the construction sector in Spain. Increasing incidences of insolvency within Fullflow Spain's customer base and mounting bad debts at a time when credit insurance cover was impossible to obtain and with main contractors demanding 180 days credit made the Spanish construction sector just too risky in which to operate. The closure cost in terms of redundancy and the settlement of bona fide financial obligations, in the face of writing off many debts as uncollectable, was substantial. Fullflow has exited Spain cleanly and all associated costs are a one-off and of an exceptional nature.
In addition to facing difficult market conditions, Fullflow failed to rise to a number of the challenges which were felt to be within its scope and as a consequence we decided to terminate the contract of the Group Managing Director. Our search for a replacement is still in progress and is a key element of our drive for growth in this business.
Fullflow UK
The construction sector in which Fullflow operates saw little or no recovery in the period under review which was the most significant factor constraining volumes. The cost control measures implemented in recent years, however, ensured that the business continued to operate profitably with good levels of customer satisfaction.
Despite a lack of dedicated leadership and limited effectiveness within the sales resource, Fullflow continued to attract and win important projects throughout the year which were transacted with a high degree of technical design competence, project management and installation effectiveness which continued to deliver good levels of customer satisfaction thereby attracting repeat business.
It is anticipated that with effective fulltime leadership and an enhanced selling resource that the business will make a meaningful step forward and this is being reflected in current orders won.
In the period post year-end, Fullflow UK has observed a stepped increase in activity levels and order intake has risen sharply.
Fullflow France
Despite the best efforts of the Fullflow Systeme team, they were only rewarded with a modest profit in the period. In contrast with its UK parent, the business continues to enjoy a profile of fewer but larger projects with a greater proportion of repeat business from clients with whom it enjoys good relationships.
The anticipated softening of the French market has not materialised and post year end activity levels have increased in line with the UK and the business is enjoying a substantial order book. The team is well equipped to transact this work load and continue to win an enhanced level of business which will reward them with a profit much more representative of their contribution in the current financial year.
Plasflow
Plasflow specialises in the fabrication of complex and large diameter pipe spools in technical plastics for the nuclear energy, power generation and water industries. The business delivered a respectable result in the period but fell short of consolidating its prior year performance when record profits were achieved.
We continue to believe that Plasflow has the potential to achieve further growth by developing its business into additional markets, particularly internationally, and this will be a key objective of the new Fullflow Group Managing Director when he is appointed.
Ulva
Ulva Insulation Systems Limited assists oil, gas and petrochemical majors globally to counter corrosion under insulation (CUI) through the provision of non-metallic jacketing systems.
Slippage on one major project severely dented Ulva's FY 2013 performance. This slippage will ultimately wash through the system and, taking a bigger picture perspective, will indicate that Ulva's turnover remains relatively static year on year notwithstanding the demanding nature of a project based business requiring new projects to be constantly won to deliver this 'static' sales performance.
It has been long identified that the business has been "resource limited" which has been the factor constraining growth but attempts to extend Ulva's resource base internationally have been patchy. Presently, good success has been achieved within the Site Services team and in the USA but finding effective resource for Asia and EMEA (Europe, Middle East and Africa) remains challenging but, nonetheless, a key priority.
Where Ulva's site services team has been utilised, the business has received strong commendations from the asset owners as a result of the delivery of global best practice solutions for the insulation systems.
The USA is a relatively new market for Ulva but the projects that have been completed in recent years, and those that are currently under construction are seeing high standards of application performance. Non-metallic cladding systems are relatively new in the USA and it has been most reassuring to see motivated application contractors, properly trained by Ulva's site services team, deliver such high standards so quickly. The next project nearing completion is Chevron's Jack St Malo platform for deployment in the Gulf of Mexico.
The Cidade de Paraty FPSO (Floating Production Storage and Offloading) went into service producing first oil in June 2013. Whilst this is not the first asset in Brazil to benefit from the protection afforded by the Ulva system, it is the first where a substantial proportion of the UlvaShield system application was undertaken in Brazil. There were of course, "lessons learned" in adjusting to custom and practice in Brazil but a quality result was achieved on time and the UlvaShield system has been selected for the follow-on project, Cidade de Ilhabela. Work on the hull was completed in China with top side fabrication and consolidation to take place in Brazil.
An independent longevity study recently published, which examined Ulva system samples recovered from the field after 15 years' service, in comparison to new materials, found no meaningful degradation of the system, thereby reassuring Ulva's discerning, specifying end users that the system will perform at least in line with, and probably well beyond expectation.
The Board of SWP approved the investment in a new process, line in the period, for the manufacture of the sheet related elements of the Ulva system. This new "state of the art" process line will be located at Ulva's Telford manufacturing location and will enrich the role of the team there with them taking the manufacture of the Ulva system from raw materials through to completed project specific systems. The new line will extend Ulva's capabilities and allow the manufacture of both reinforced and non-reinforced membranes at varying thicknesses and widths. Dependency upon external processing by third party companies will be eliminated, with a corresponding cost saving, and the yield from raw materials will be improved. The Telford facility has been substantially re-designed and upgraded to accommodate the new process line including the introduction of a high voltage power supply. All preparation works are complete with the installation of the line planned to commence early in January 2014 with commissioning to follow shortly thereafter. The project remains on plan and to budget.
This new line will replace the antiquated and sometimes unreliable line at Soham previously operated by DRC. With there being little prospect of replacing the Ulva business with anything of similar scope the decision was taken to cease DRC's trading activities and thereby eliminate all costs associated with this enterprise
Considerable progress has been made with the development of the UlvaGRP system which will operate alongside the UlvaShield system when launched. The product is well into the testing and certification phase but this has revealed some anomalies. Ulva aspires to release its GRP (Glass Reinforced Plastic) range with performance characteristics that are similar to the UlvaShield system. Testing, however, has revealed that all of the current commercially available GRP systems fall short, particularly in the area of longevity. Further consultation is underway with specifiers in order to determine whether a lower performance level will be acceptable or if the product technology (and cost) will need to developed to come closer the that of UlvaShield.
Health & Safety
The Group's health and safety processes are becoming increasingly tried, tested and robust. There were no reportable incidents in the year under review. A programme of continuous improvement is delivering incremental positive steps and driving off any risk of complacency.
Colin Stott
Group Managing Director
Consolidated Statement of Comprehensive Income
Year ended 30 June 2013 2013 2012
GBP'000 GBP'000
Continuing operations
Revenue 14,317 20,922
Cost of sales (7,430) (11,934)
---------- ---------
Gross profit 6,887 8,988
Operating expenses (6,126) (7,466)
---------- ---------
761 1,522
Profit attributable to associate 38 -
Exceptional operating expenses (821) (196)
Amortisation of intangible assets acquired
through business combinations net of deferred
tax (165) (165)
Share based payment (80) (42)
---------- ---------
Operating (loss)/profit (267) 1,119
Financial income - -
Financial costs (187) (284)
---------- ---------
(Loss)/profit on ordinary activities before
taxation (454) 835
Income tax credit/(charge) 98 (227)
---------- ---------
(Loss)/profit for the year for continuing
operations (356) 608
Loss for the year from discontinued operations (543) -
---------- ---------
(Loss)/profit for the year (899) 608
========== =========
Total comprehensive income
Net gain on revaluation of land and buildings 42 -
Deferred tax on revaluation of land and buildings (61) -
---------- ---------
Other comprehensive income for the year (19) -
---------- ---------
(Loss)/profit for the year and total comprehensive
income attributable to equity holders of the
Company (918) 608
========== =========
Earnings per share from continuing and discontinued
operations attributable to the equity holders
of the company during the year
Basic earnings (loss) per share
From continuing operations (0.17)p 0.30p
From discontinued operations (0.27)p -
---------- ---------
(0.44)p 0.30p
========== =========
Diluted earnings (loss) per share
From continuing operations (0.17)p 0.30p
From discontinued operations (0.27)p -
---------- ---------
(0.44)p 0.30p
========== =========
Revenue and operating profit all derive from continuing operations.
There were no recognised gains and losses for 2013 or 2012 other than those included in the Group Income Statement.
Consolidated Statement of Changes in Equity
Called Other Revaluation Retained Total
up share reserves reserve earnings Equity
capital
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 30 June 2011 1,016 79 229 13,136 14,460
Result for the
year - - - 608 608
Dividend - - - (151) (151)
Share based payment - 42 - - 42
Purchase of treasury
shares - - - (114) (114)
At 30(th) June
2012 1,016 121 229 13,479 14,845
Result for the
year - - - (899) (899)
Revaluation - - (19) - (19)
Dividend - - - (151) (151)
Share based payment - 80 - - 80
Purchase of treasury
shares - - - (35) (35)
---------- ---------- -------------- ---------- --------
At 30 June 2013 1,016 201 210 12,394 13,821
========== ========== ============== ========== ========
Consolidated Statement of Financial Position
At 30 June 2013 2013 2012
GBP'000 GBP'000
Non current assets
Intangible assets 8,083 8,310
Property, plant and equipment 5,159 5,525
Trade and other receivables 301 504
Deferred tax assets 422 472
Investment 88 50
-------- ---------
14,053 14,861
-------- ---------
Current assets
Inventories 3,239 2,983
Trade and other receivables 4,823 8,445
8,062 11,428
-------- ---------
Total assets 22,115 26,289
-------- ---------
Current liabilities
Trade and other payables (3,794) (5,724)
Current tax liabilities (127) (371)
Obligations under finance leases (13) (10)
Bank loans and overdrafts (2,030) (1,895)
-------- ---------
(5,964) (8,000)
-------- ---------
Non current liabilities
Bank loans (304) (1,285)
Deferred tax liabilities (2,018) (2,147)
Obligations under finance leases (8) (12)
-------- ---------
(2,330) (3,444)
-------- ---------
Total liabilities (8,294) (11,444)
-------- ---------
Net assets 13,821 14,845
======== =========
Equity
Called up share capital 1,016 1,016
Other reserves 201 121
Revaluation reserve 210 229
Retained earnings 12,394 13,479
-------- ---------
Equity attributable to shareholders
of the parent 13,821 14,845
======== =========
Consolidated Statement of Cash Flows
Year ended 30 June 2013
2013 2012
GBP'000 GBP'000
(Loss)/profit after tax (899) 608
Adjustments for:
Net finance costs 191 281
Corporation tax (credit)/charge (61) 231
Depreciation of property, plant
and equipment 313 286
Revaluation of properties 383 -
Amortisation of intangible assets 236 240
Profit/(loss) on disposal of plant
and equipment (1) 1
---------- ---------
Operating cash flows before movement
in working capital 162 1,647
(Increase)/decrease in inventories (256) 812
Decrease/(increase) in receivables 3,825 (1,587)
(Decrease)/increase in payables (1,960) 671
Interest paid (197) (284)
Corporation tax paid (185) (49)
---------- ---------
Net cash inflow from operating
activities 1,389 1,210
---------- ---------
Cash flow from investing activities
Purchase of property, plant and
equipment (352) (192)
Purchase of intangible assets (9) -
Purchase of Investments - (50)
Proceeds from disposals of property,
plant and equipment 5 5
---------- ---------
Net cash outflow from investing
activities (356) (237)
---------- ---------
Cash flow from financing activities
Dividend paid (151) (151)
Bank loans repaid (925) (1,314)
Purchase of treasury shares (35) (114)
Finance lease repayments, net (1) 8
---------- ---------
Net cash outflow from financing
activities (1,112) (1,571)
---------- ---------
Net increase in cash and bank
overdrafts (79) (598)
Cash, cash equivalents and bank
overdrafts at
beginning of year (914) (316)
---------- ---------
Cash, cash equivalents and bank
overdrafts at end of year (993) (914)
========== =========
Notes to the Financial Statements
1. BASIS OF PREPARATION
Whilst the information included in this final results announcement has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards ("IFRSs") as adopted for use in the European Union and as issued by the International Accounting Standards Board, this announcement does not itself contain sufficient information to comply with IFRSs.
The final results announcement for the 12 months to 30 June 2013 has been prepared on a consistent basis with the financial accounting policies set out in the Accounting Policies section of the SWP Group Plc Annual Report and Financial Statements 2013.
2. SEGMENTAL REPORTING
BUSINESS SEGMENTS
Rainwater Metal staircases Polymer Corporate Total
management year ended membrane year ended year ended
year ended 30 June year ended 30 June 30 June
2013 30 June 2013 30 June 2013 2013
2013 2013
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue
External revenues 7,572 1,381 5,364 - 14,317
InterGroup sales 1,716 - 1,598 - 3,314
------------ ----------------- ------------ ------------ ------------
Total revenues 9,288 1,381 6,962 - 17,631
Cost of sales (5,974) (1,151) (3,619) - (10,744)
------------ ----------------- ------------ ------------ ------------
Gross profit 3,314 230 3,343 - 6,887
Operating expenses (2,906) (575) (1,657) (988) (6,126)
------------ ----------------- ------------ ------------ ------------
408 (345) 1,686 (988) 761
Profit attributable to
associate - - - 38 38
Exceptional operating
expenses (391) 9 (21) (418) (821)
Amortisation of intangible
assets acquired through
business combinations
net of deferred tax - - - (165) (165)
Share based payment - - - (80) (80)
InterGroup royalty (charge)/income - - (1,036) 1,036 -
InterGroup management
fees - - (228) 228 -
InterGroup rent (charges)/income - - (72) 72 -
Operating profit 17 (336) 329 (277) (267)
Financial income - - - - -
Financial costs (7) - - (180) (187)
InterGroup financial
charges (27) - - 27 -
------------ ----------------- ------------ ------------ ------------
Profit on ordinary activities
before taxation (17) (336) 329 (430) (454)
Income tax (charge)/credit (1) 55 (77) 121 98
------------ ----------------- ------------ ------------ ------------
Profit for the year attributable
to equity holders of
the Company (18) (281) 252 (309) (356)
------------ ----------------- ------------ ------------ ------------
Loss for the year from
discontinued operations (543) - - - (543)
------------ ----------------- ------------ ------------ ------------
(Loss)/profit for the
year (561) (281) 252 (309) (899)
============ ================= ============ ============ ============
2013 Rainwater Metal Polymer Corporate IntraGroup Total
management staircases membrane year ended year ended year
year ended year ended year ended 30 June 30 June ended
30 June 30 June 30 June 2013 2013 30 June
2013 2013 2013 2013
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Other information
Capital expenditure 7 6 321 18 - 352
Depreciation and
amortisation 57 23 147 265 - 492
Segmental assets 8,451 1,842 7,340 17,151 (12,669) 22,115
Segmental liabilities (5,365) (925) (5,436) (9,237) 12,669 (8,294)
------------- ------------ ------------ ------------ ------------ ---------
Net assets as at
30 June 2013 3,086 917 1,904 7,914 - 13,821
============= ============ ============ ============ ============ =========
2012 Rainwater Metal staircases Polymer Corporate Total
management year ended membrane year ended year
year ended 30 June year ended 30 June ended
30 June 2012 30 June 2012 30 June
2012 2012 2012
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue
External revenues 11,229 2,254 7,439 - 20,922
InterGroup sales 2,215 1 1,566 - 3,782
------------ ----------------- ------------ ------------ ---------
Total revenues 13,444 2,255 9,005 - 24,704
Cost of sales (9,119) (1,425) (5,172) - (15,716)
------------ ----------------- ------------ ------------ ---------
Gross profit 4,325 830 3,833 - 8,988
Operating expenses (4,300) (660) (1,735) (771) (7,466)
------------ ----------------- ------------ ------------ ---------
25 170 2,098 (771) 1,522
Exceptional operating
expenses (178) (18) - - (196)
Amortisation of intangible
assets acquired through
business combinations
net of deferred tax - - - (165) (165)
Share based payment - - - (42) (42)
InterGroup royalty (charge)/income - - (1,136) 1,136 -
InterGroup management
fees - - (228) 228 -
InterGroup rent (charges)/income - - (72) 72 -
Operating profit (153) 152 662 458 1,119
Financial costs (52) - (1) (231) (284)
InterGroup financial
charges (27) - (60) 87 -
------------ ----------------- ------------ ------------ ---------
Profit on ordinary activities
before taxation (232) 152 601 314 835
Income tax (charge)/credit (85) (24) (154) 36 (227)
------------ ----------------- ------------ ------------ ---------
Profit for the year attributable
to equity holders of
the Company (317) 128 447 350 608
============ ================= ============ ============ =========
2012 Rainwater Metal staircases Polymer Corporate IntraGroup Total
management year ended membrane year ended year ended year ended
year ended 30 June year ended 30 June 30 June 30 June
30 June 2012 30 June 2012 2012 2012
2012 2012
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Other information
Capital expenditure 58 - 90 44 - 192
Depreciation and
amortisation 79 49 132 265 - 526
Segmental assets 10,990 2,456 8,125 17,216 (12,498) 26,289
Segmental liabilities (5,339) (981) (6,373) (11,249) 12,498 (11,444)
------------ ----------------- ------------ ------------ ------------ ------------
Net assets as at 30
June 2012 5,651 1,475 1,752 5,967 - 14,845
============ ================= ============ ============ ============ ============
The Board has determined the operating segments based on the reports reviewed by the Board that are used to make strategic decisions. The Board reviews the results of each entity within the Group on a regular basis and accordingly each entity is deemed to be an operating segment. The operating segments have been aggregated into the reportable segments disclosed above in accordance with IFRS 8 Operating Segments.
The Board is provided with financial reports for each of the reportable segments above on a regular basis. The United Kingdom is the home country of the Group.
The Directors consider that certain entities within the Group constitute an operating segment as information about each Company is regularly presented to the Board.
Sales between segments are carried out at arm's length. The revenue from external parties reported to the Board is measured in a manner consistent with that in the statement of comprehensive income.
The amounts provided to the Board with respect to total assets and total liabilities are measured in a manner consistent with that of the consolidated financial statements. Assets are allocated based on the operations of the segment and the physical location of the asset. Liabilities are allocated based on the operations of the segment.
Information in respect of revenues from external customers and detailed splits of revenues between individual foreign countries has not been disclosed. This type of information is not presented to the Board when making strategic decisions and is not readily available.
There were no Clients or contract representing more than 10% of Group revenue in the current year.
The accounting policies note for revenue gives further information about the classifications of revenue between the business segments for this and the comparative year. The rainwater management segment is construction contract based in nature and its revenue is accounted for in accordance with IAS11, Construction Contracts, additionally certain contracts included in the Polymer Membrane segment are accounted for as construction contracts. The staircases and polymer membrane segments relate principally to the supply of goods, accounted in accordance with IAS18, Revenue. The supply of services for these segments is incidental to the supply of goods.
The aggregate amount of costs incurred on construction contracts in progress at the balance sheet date is GBP631,000 (2012: GBP1,464,000).
The aggregate amount of recognised profits incurred on construction contracts in progress at the balance sheet date is GBP243,000 (2012: GBP466,000).
GEOGRAPHICAL SEGMENTS
The Group's operations are located in the UK, France and Spain.
The following table provides an analysis of the Group's sales by geographical market, irrespective of the origin of the goods/services
Year ended Year ended
30 June 2013 30 June 2012
GBP'000 GBP'000
UK 6,711 9,498
Rest of Europe 4,021 6,576
Far East 1,566 3,359
Africa and Middle East 1,184 768
USA 472 721
Australasia 127 -
South America 236 -
-------------- --------------
14,317 20,922
============== ==============
The following is an analysis of the carrying amount of segment net assets and additions to property, plant and equipment and intangible assets, analysed by the geographical area in which the assets are located.
Carrying Additions to
amount of property, plant
segment assets and equipment
and intangible assets
Year ended Year ended Year ended Year ended
30 June 30 June 30 June 30 June
2013 2012 2013 2012
GBP'000 GBP'000 GBP'000 GBP'000
UK 13,070 13,766 352 164
France 751 957 - 28
Spain - 122 - -
----------- ----------- ------------ -----------
13,821 14,845 352 192
=========== =========== ============ ===========
3. EARNINGS PER SHARE
Basic earnings per share is calculated by dividing the profit attributable to equity holders of the Parent Company by the weighted average number of ordinary shares in issue during the year.
Diluted earnings per share is calculated by dividing the profit attributable to equity holders of the Parent Company by the weighted average number of ordinary shares in issue during the year shares plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares.
Treasury shares are deducted from total shares in issue for the purposes of calculating earnings per share.
The basic loss per share is (0.44)p (2012 - profit 0.30p).
The diluted loss per share is equal to the basic loss per share as the Group made a loss during the year and is antidilutive (2012 - profit 0.30p).
The basic earnings per share calculation for the year ended 30 June 2013 is based on the weighted average of 203,275,006 (2012 - 196,586,376) ordinary shares in issue during the year and the loss of GBP899,000 (2012 - profit GBP608,000).
A copy of the financial report and accounts will be dispatched to shareholders by no later than 8(th) January 2014 and a copy will also be available on the Group's website, www.swpgroupplc.com
For further information or enquiries please contact:
J.A.F Walker D.J. Pett
Chairman Finance Director
SWP Group plc SWP Group plc
Tel office: 01353 723270 Tel office: 01353 723270
Mobile: 07800 951151 Mobile: 07940 523135
Ranald McGregor-Smith Richard Kauffer/Daniel
Corporate Finance Advisors Harris
Whitman Howard Nominated Advisor & Broker
Tel office: 0207 087 4555 Peel Hunt LLP
Tel office: 020 7418 900
This information is provided by RNS
The company news service from the London Stock Exchange
END
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