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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Van Elle Holdings Plc | LSE:VANL | London | Ordinary Share | GB00BYX4TP46 | ORD 2P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 33.50 | 33.00 | 34.00 | 33.50 | 33.50 | 33.50 | 394 | 08:00:13 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Engineering Services | 148.73M | 4.68M | 0.0438 | 7.65 | 35.76M |
From Apr 2022 to Apr 2024
TIDMVANL
RNS Number : 7450N
Van Elle Holdings PLC
25 January 2023
Van Elle Holdings plc
('Van Elle', the 'Company' or the 'Group')
Interim Results for the six months ended 31 October 2022
Analyst Briefing and Investor Presentation
Van Elle Holdings plc, the UK's largest ground engineering contractor, announces its Interim Results for the six months ended 31 October 2022 (the 'Period').
Hot Features
Premium
GBPm 6 months 6 months
ended ended
31 Oct 2022 31 Oct 2021
---------------------------------------------------------------------- ------------- -------------
Revenue 80.8 60.1
EBITDA(1) 6.4 4.8
Operating profit 3.5 2.3
Profit before taxation 3.3 1.9
Basic earnings per share (p) 2.6 1.4
ROCE(2) 11.2% 4.4%
Net debt (2.5) (2.0)
Net funds (excluding IFRS 16 property and vehicle lease liabilities) 3.5 3.5
Interim dividend per share (p) 0.4 -
---------------------------------------------------------------------- ------------- -------------
(1) EBITDA is defined as earnings before interest, tax, depreciation and amortisation
(2) Return on capital employed is defined as 12-month rolling operating profit divided by average net assets excluding net debt
There are no non-underlying items in the current or comparative Period.
Period highlights
-- Record half year revenue with operating profit significantly ahead of the prior year -- All divisions operated with high activity levels throughout the Period
-- Rail business delivered major electrification programmes under framework agreements, seeing continuation of strong activity levels
-- Balance sheet remains strong with a net funds position at the Period end (excl. IFRS 16 property and vehicle lease liabilities), retaining significant liquidity headroom
-- Healthy order book at 31 December 2022 of GBP38.3m (31 October 2022: GBP49.0m) excluding frameworks
-- Secured framework agreements are expected to contribute materially to FY24 and beyond, with estimated annual revenues over the medium-term in the range of GBP30m-40m (subject to allocation of workload)
-- Interim dividend declared of 0.4 pence per share following a reinstatement of dividend distributions at the time of the 2022 Final Results
Outlook
-- The Group has continued to trade in line with management's expectations since the Period end
-- The housing sector is expected to deliver lower volumes in the short-term, however, Van Elle's Infrastructure and Construction markets remain healthy and typically deliver an improved margin mix
-- Secured frameworks provide much improved work visibility through to FY25 -- The Board remains confident in achieving market expectations for the full year (1)
(1) Company compiled analyst consensus for FY2023 underlying profit before tax is GBP5.3m with a range of GBP5.2m - GBP5.4m
Mark Cutler, Chief Executive, commented: "Strong trading momentum was sustained throughout the Period despite a challenging macro environment. All divisions operated at high activity levels throughout, with significantly increased revenues delivered in Housing and General Piling, Rail activity in line with expectations and the Group as a whole reporting record revenues.
"The Group is benefitting from improved future work visibility, primarily due to being appointed to several strategic frameworks in highways and rail, all of which require an integrated delivery approach across our specialist capabilities.
"Market conditions in the short term, especially in respect of new build housing, are expected to be more challenging, however Van Elle is well positioned to benefit from opportunities across its breadth of end markets and diverse customer base. The Board therefore remains confident in the delivery of our medium-term strategy, and in achieving market expectations for the full year."
Analyst Briefing: 9.30am on Wednesday 25 January 2023
A briefing for Analysts will be held at 9.30am today. Analysts interested in attending should contact Walbrook PR on vanelle@walbrookpr.com or 020 7933 8780.
Investor Presentation: 3.30pm on Wednesday 25 January 2023
Mark Cutler, Chief Executive Officer, and Graeme Campbell, Chief Financial Officer, will hold a presentation to review the results and outlook at 3.30pm today. The presentation will be hosted through the digital platform Investor Meet Company.
Investors can sign up to Investor Meet Company for free and add to meet Van Elle Holdings plc via the following link https://www.investormeetcompany.com/van-elle-holdings-plc/register-investor . Investors who have already registered and added to meet the Company will automatically be invited.
Questions can be submitted pre-event to vanelle@walbrookpr.com or in real time during the presentation via the "Ask a Question" function.
For further information, please contact:
Van Elle Holdings plc Via Walbrook
Mark Cutler, Chief Executive Officer
Graeme Campbell, Chief Financial Officer
Peel Hunt LLP (Nominated Adviser and corporate Tel: 020 7418 8900
broker)
Ed Allsopp / Mike Bell
Walbrook PR Limited Tel: 020 7933 8780
or vanelle@walbrookpr.com
Tom Cooper / Nick Rome 07971 221 972 or
07748 325 236
About Van Elle Holdings plc:
Van Elle Holdings is the UK's largest specialist geotechnical engineering contractor. The Company provides a range of ground engineering techniques and services including - ground investigation, general and specialist piling, rail geotechnical engineering, modular foundations, and ground improvement and stabilisation services.
Van Elle operates through three divisions: General Piling, Specialist Piling and Rail, and Ground Engineering Services; and is focused on three end markets: residential and housing, infrastructure and regional construction - across which the Group has completed more than 20,000 projects over the last 35 years.
General Piling provides a range of larger piling and ground engineering solutions for open-site construction projects. Specialist Piling and Rail provides a range of geotechnical solutions in operationally constrained environments including on-track rail applications. Ground Engineering Services offers a range of ground investigation and geotechnical services and modular foundation solutions such as Smartfoot(R). Van Elle has a market-leading reputation and the UK's largest rig fleet of over 120 rigs.
Having floated on AIM in 2016 it now has a strong national presence, diversified offering and market-leading brand name.
Van Elle Holdings plc - Interim Report to 31 October 2022
Results overview
Strong trading momentum was sustained throughout the Period despite a challenging macro environment. All divisions operated at high activity levels throughout, with significantly increased revenues delivered in Housing and General Piling, with the Group as a whole reporting record revenues.
Half year revenues of GBP80.8m were 35% ahead of the prior period (H1 FY2022: GBP60.1m).
The housebuilding market delivered strong demand, resulting in very high activity levels throughout the Period. Infrastructure and general construction markets also continued to show good growth, with improving order levels and contract activity.
The supply chain disruption which impacted the Group's results over recent reporting periods has eased, with improved stability of input prices and better availability of raw materials. However, inflationary pressures have continued to adversely affect the cost base, particularly through wage, utilities and fuel cost increases. These cost increases are mitigated through contract price mechanisms as far as possible, however, in some cases there is a lag in recovery.
A shortage of skilled labour in the construction sector has continued to present a challenge, particularly due to the increased capacity requirement to support the Group's revenue growth. Skilled construction employees remain in high demand across the UK, with the industry affected by significant numbers of operational staff still needed to meet the requirements of HS2. The Group has maintained a high focus on both recruitment and retention of employees, and the directly employed workforce increased to 659 from 630 during the Period.
The Group delivered a materially improved operating profit of GBP3.5m (H1 FY2022: GBP2.3m), with basic earnings per share increasing by 85% to 2.6p (H1 FY2022: 1.4p).
Net funds (excluding IFRS 16 property and vehicle lease liabilities) decreased from GBP5.9m as at 30 April 2022, to GBP3.5m at the end of the Period. This reflects an increase in working capital of GBP3.9m, primarily due to the impact of higher trading activity, and increased capital expenditure. Net capital expenditure of GBP3.5m represents an increased investment in the rig fleet following below average capital spend over the preceding three years. The Group paid the 2022 final dividend of GBP1.1m in the Period.
The Group maintains a strong balance sheet with a healthy cash balance and significant liquidity headroom against its GBP11.0m funding facility. During the Period, GBP3.0m of the asset-backed lending facility was drawn to support working capital growth and capital investment. In addition, GBP1.5m of new hire purchase finance was arranged on a variable interest rate basis, with no early repayment charges. The Group continues to maintain modest levels of debt (excluding IFRS 16 lease liabilities) and remains well within its target leverage threshold of less than 1.5x EBITDA. Total hire purchase finance at the end of the Period was GBP2.0m.
The Group's order book at 31 December 2022 decreased to GBP38.3m (31 October 2022: GBP49.0m) in line with expectations due to the quieter winter trading period.
Market overview
All of the Group's core markets performed strongly, and ahead of pre-pandemic levels. The impact and challenges associated with Covid have largely dissipated, although the economic uncertainty has started to present new considerations which are expected to impact certain end markets in the near term, however it is too early to quantify these at this stage.
The Group operates in the following three market segments:
-- Residential constitutes approximately 38% of Group revenues in the Period (43% in H1 FY2022). Although revenue increased by 20%, it represented a lower percentage of overall revenues in the Period. Van Elle's teams deliver integrated ground improvement, piling and modular, precast concrete foundation systems for national and regional housebuilders, retirement and multi-storey residential properties.
Since the housebuilding market recovered following the severe impact on the sector from Covid lockdowns in 2020, customer activity, and demand for the Smartfoot system has been very strong.
The impact of increasing interest and mortgage rates is likely to slow new build starts and will result in a reduction in activity levels. The Group operates across a diverse range of customers and geographies in the housebuilding sector, and this should provide some protection against reduced volumes in regional areas or specific housebuilding segments (private, affordable homes, or social housing). The Board remains confident that Van Elle's unique range of geotechnical solutions for housebuilders will continue to prove popular with both traditional housebuilders and emerging modular housebuilders when markets recover.
-- Infrastructure constitutes approximately 39% of Group revenues in the Period (36% in H1 FY2022) and includes specialist ground engineering services to the rail, highways, energy, coastal, flood and utility sectors. Revenue increased by 45% year-on-year.
In the highways sector, projects continued to be delivered under local authority and National Highways frameworks. In the second half of FY2022, the Group was appointed to the 10-year Smart Motorways Programme Alliance (SMPA) framework and a major 5-6 year programme to construct additional emergency refuge areas will commence construction in early FY2024.
In the rail sector, major electrification programmes in south Wales and the east midlands are ongoing and are expected to provide a core workload for future trading. The Group has also been appointed as a framework partner to the TransPennine Route Upgrade (TRU) programme. Activity levels in the rail sector have continued strongly as CP6 enters the final year before the planning phase of CP7 commences in 2024. International opportunities in rail are also being developed further to provide some protection against the cyclical nature of the UK's rail activities.
HS2 continues to offer considerable medium-term opportunities, where Van Elle anticipates its services will be used by main contractors to provide additional capacity for the high workloads required to meet the project deadlines.
In the energy sector, two major contracts were awarded during 2022, the most recent of which is valued at GBP13m and work commenced on site in December, with delivery expected within this financial year. Further activity has been completed through the Specialist Piling division in the high voltage power sector where further growth is anticipated in FY2024.
-- Regional Construction constitutes approximately 22% of Group revenues (21% in H1 FY2022) and has seen revenue growth of 47%, primarily driven by industrial and logistics warehouse projects for private customers across the UK, and larger commercial projects in central London, delivered substantially by the General Piling division. The Group delivers a full range of piling services, but the growth of our ground improvement capabilities has assisted in accessing a wider range of attractive projects in the industrial sector.
The regional construction market was very strong in the Period although the market has remained relatively competitive and, as a result, price sensitive.
Operating structure
Van Elle's operational Group structure has remained consistent and is reported in three segments:
-- General Piling : open site; larger projects; key techniques being large diameter rotary, CFA piling and precast driven piling.
-- Specialist Piling and Rail : restricted access and low headroom piling; extensive rail mounted capability; helical piling and steel modular foundations (ScrewFast); sheet piling, soil nails and anchors, mini-piling and ground stabilisation projects.
-- Ground Engineering Services : driven and CFA piling for housebuilders, precast concrete modular foundations (Smartfoot); ground investigation and geotechnical services (Strata Geotechnics).
General Piling
Revenue increased by 62% in the Period to GBP29.3m (H1 FY2022: GBP18.1m), representing 36% of Group revenues.
Market conditions remained competitive throughout the Period, with price-sensitive tendering continuing to be a key factor in work winning. However, the division made further progress in developing strong customer relationships and delivered high-quality contract works utilising significant technical capabilities. The growth in the Period was assisted by the completion of several major projects across the UK, using the Group's rotary, CFA, precast driven and rigid inclusion capabilities.
Despite ongoing inflationary pressures (particularly fuel, raw materials and wages), the increase in activity levels resulted in a significantly improved operating profit of GBP2.3m for the Period (H1 FY2022: GBP0.9m).
Specialist Piling and Rail
Revenue increased by 12% in the Period to GBP24.8m (H1 FY2022: GBP22.1m), representing 31% of Group revenues.
Specialist Piling experienced very high levels of demand following the market recovery, post the first Covid lockdowns. Further revenue growth has been achieved in the Period as a result of the division expanding its operational capability by investing in new rigs for growth and increasing the number of site gangs. Key contracts included passing the landmark of the 200(th) rail station project, the start of the M6 Smart Motorway scheme, several HV substations and several major ground stabilisation contracts for housebuilders.
The long-term outlook for the Division's work in the infrastructure sector remains very positive, with an increase in Smart Motorway works expected to mobilise in early FY2024.
Rail delivered stronger revenues than in previous periods, continuing the improved momentum in the second half of FY2022. Piling works continued for the decarbonisation and electrification of the Core Valley Lines rail network and the Group was appointed to the piling framework for the TRU programme between Manchester and Leeds in the Period. Work on TRU is expected to commence in FY2024 and will involve both the Specialist Piling and Rail divisions for up to three years.
The Rail division continued a rolling programme of rig updates, including mid-life overhaul of several Colmar road and rail piling rigs. The rolling programme of maintenance work commenced in FY2022 and will be largely concluded by the end of FY2024. Orders for five, new generation, UK designed and built rigs were placed in the prior year at a cost of approximately GBP2.5m.
Operating profit for the division decreased to GBP1.1m (H1 FY2022: GBP1.6m). The result was impacted by some challenging contracts in the Specialist Piling division and rail strikes across the UK, which have caused short-term disruption to the Rail division with some works cancelled at late notice. Both Rail and Specialist Piling were impacted by inflationary factors across their cost base in the Period.
Ground Engineering Services
Revenue increased by 34% in the Period to GBP26.6m (H1 FY2022: GBP19.8m), representing 33% of Group revenues.
The Housing division delivers integrated piling and Smartfoot foundation beam solutions to UK housebuilders. Activity levels were high throughout the Period, with the division operating at current capacity. Production capacity was consistently exceeded, with beam production being partially outsourced to meet the demand of site works.
The division has also expanded its geographic footprint with new contracts being won and delivered in the South of England.
Strata, Van Elle's Geotechnical division, reported increased revenue of GBP3.5m (H1 FY2022: GBP3.0m). Further progress in infrastructure work has increased activity levels, particularly in the highways sector (including under the Highways England ground investigation framework) and on HS2 ground investigation projects.
Underlying operating profit for the segment increased to GBP2.5m (H1 FY2022: GBP1.2m).
Strategic approach
The Group continued to make good progress against Phase 3 of the strategy, and is seeing the early benefits of actions taken under Phases 1 and 2 (which are substantially complete, although subject to continuous improvement), as summarised below:
Phase 1: Stabilising and improving performance
Simplifying the Group structure, improving leadership capability, strengthening commercial capability, cost reduction and efficiency improvements, safety and asset utilisation performance, and employee engagement activities.
Phase 2: Developing foundations for growth
Developing clear strategic plans for the Group's core sectors of housing, infrastructure and regional construction, improving customer relationships and tendering activity, maximising the integrated solutions offering, broadening the range of products and services, and strengthening the Group's balance sheet.
Phase 3: Establishing market leadership
Sustainable, profitable growth towards medium term objectives of revenue growth of 5-10% per annum, underlying operating margins of 7-8%, and return on capital employed of 15-20%.
The Group's vision is to be the leading, most trusted provider of Total Foundation Solutions and its strategic goals are aligned under three pillars of developing trusted partnerships, deploying the best people and assets and the perfect delivery of our projects.
ESG
The Group launched its sustainability strategy in FY2022 which is aligned to industry best practice including guidance from the Construction Leadership Council programme.
Van Elle's ESG strategy is sponsored by a member of the executive team and an Environmental and Sustainability Manager was appointed in the Period to lead delivery of the Group's vision, which is to help create a sustainable future through efficient and innovative foundation solutions in collaboration with customers and other stakeholders.
In December 2022, the Group committed to formalising our approach to sustainability by making a commitment to setting science-based targets and tracking performance against these targets.
A sustainability working group is now well established and meets periodically to consider a broad range of ESG initiatives.
In addition to the focus on sustainability of site operations, the Group has undertaken a number of initiatives, including establishing an electric company car scheme, installing vehicle charging points at its offices, and improvements to water management at the main site in Kirkby-in-Ashfield where the Group is also planning to install solar panels in FY2024.
The Group has switched to an electricity supply contract which ensures that all electricity is provided from 100% renewable energy source, certified by Renewable Energy Guarantees of Origin.
Van Elle's social initiatives include various charitable activities, including partnering with a local charity, which is selected by employees. Van Elle also promotes volunteering and teams have completed activities to support the local community over the course of the year.
Dividend
Following a prudent and temporary pause from dividend distributions as a result of the Covid-19 pandemic and benefitting from a recovery of the Group's core end markets, Van Elle resumed dividend payments, commencing with a final dividend of 1.0 pence per share in relation to the year ended 30 April 2022.
The Board acknowledges that dividends continue to represent an important constituent of total shareholder returns, and accordingly has declared an interim dividend of 0.4 pence per share, representing the first interim dividend distribution since FY2019.
The interim dividend will be payable on 17 March 2023 to shareholders on the share register as at 24 February 2023. The shares will be marked ex-dividend on 23 February 2023.
Current trading and outlook
Trading since the Period end has continued in line with management's expectations.
Whilst there remains significant macroeconomic uncertainty, most of the Group's core markets continue to show a positive outlook. The housebuilding sector is expected to deliver lower volumes in the short term, however, the infrastructure sector is forecasting modest growth, as noted in the recent CPA forecasts. Whilst this might impact overall volumes through the second half the year, the Group should benefit from a positive mix of higher margin work delivered.
Raw material supply chain disruption moderated in the Period, with improved stability of input prices and better availability of raw materials. Inflationary pressures on the Group's cost base have continued and are likely to persist in the short term, however, the Group continues to largely offset cost increases through contract pricing mechanisms.
The Group is benefitting from improved future work visibility, primarily due to being appointed to several framework agreements. The Smart Motorways Programme Alliance provides a strong pipeline of work forecast through to FY2025. The Rail division is engaged on multiple frameworks including the Core Valley Lines and TransPennine Route Upgrade, both of which require complementary works from other divisions. The Group also expects to be increasingly involved in support of HS2 phase 1 joint ventures.
Market conditions in the short term, especially in respect of new build housing, are expected to be more challenging. Van Elle is well positioned to benefit from opportunities across a number of end markets, and the Board is confident that the near-term outlook remains positive and its expectations for the full year remain unchanged.
Mark Cutler
Chief Executive Officer
25 January 2023
Condensed consolidated statement of comprehensive income
6 months 6 months 12 months
to 31 Oct to to 30 Apr
Note 2022 (unaudited) 31 Oct 2022 (audited)
GBP'000 2021 (unaudited) GBP'000
GBP'000
------------------------------------ ------- ------------------ ------------------ ----------------
Revenue 3 80,836 60,061 124,915
Cost of sales (60,211) (42,967) (90,842)
------------------------------------ ------- ------------------ ------------------ ----------------
Gross profit 20,625 17,094 34,073
Administrative expenses (17,309) (14,819) (29,980)
Credit loss impairment charge - (115) (159)
Other operating income 169 125 438
------------------------------------ ------- ------------------ ------------------ ----------------
Operating profit 3,485 2,285 4,372
Finance expense (200) (368) (779)
Profit before tax 3,285 1,917 3,593
Income tax expense (465) (448) (1,733)
------------------------------------ ------- ------------------ ------------------ ----------------
Profit after tax and total
comprehensive income for the
year attributable to shareholders
of the parent 2,820 1,469 1,860
------------------------------------ ------- ------------------ ------------------ ----------------
Earnings per share (pence)
Basic 4 2.6 1.4 1.7
Diluted 4 2.6 1.4 1.7
------------------------------------ ------- ------------------ ------------------ ----------------
All amounts relate to continuing operations. There was no other comprehensive income in either the current or preceding Period.
Condensed consolidated statement of financial position
Restated
As at As at As at
31 Oct 31 Oct 30 Apr
2022 (unaudited) 2021 (unaudited) 2022 (audited)
GBP'000 GBP'000 GBP'000
------------------------------- ------------------- ------------------ -----------------
Non-current assets
Property, plant and equipment 40,149 38,276 38,719
Investment property 806 815 811
Intangible assets 3,787 3,720 3,847
------------------------------- ------------------- ------------------ -----------------
44,742 42,811 43,377
------------------------------- ------------------- ------------------ -----------------
Current assets
Inventories 4,091 4,148 3,773
Trade and other receivables 43,181 33,109 34,112
Corporation tax receivable - 84 322
Cash and cash equivalents 8,443 6,344 6,987
55,715 43,685 45,194
------------------------------- ------------------- ------------------ -----------------
Total assets 100,457 86,496 88,571
------------------------------- ------------------- ------------------ -----------------
Current liabilities
Trade and other payables 27,636 20,703 22,475
Loans and borrowings 3,000 49 -
Deferred consideration - - 50
Lease liabilities 2,159 2,723 1,696
Provisions 8,047 7,538 7,738
40,842 31,013 31,959
------------------------------- ------------------- ------------------ -----------------
Non-current liabilities
Loan and borrowings - 110 -
Deferred consideration 1,193 1,547 1,170
Lease liabilities 5,798 5,474 5,157
Deferred tax 4,139 2,150 3,674
11,130 9,281 10,001
------------------------------- ------------------- ------------------ -----------------
Total liabilities 51,972 40,294 41,960
------------------------------- ------------------- ------------------ -----------------
Net assets 48,485 46,202 46,611
------------------------------- ------------------- ------------------ -----------------
Equity
Share capital 2,133 2,133 2,133
Share premium 8,633 8,633 8,633
Other reserve 5,807 5,807 5,807
Retained earnings 31,912 29,629 30,038
Total equity 48,485 46,202 46,611
------------------------------- ------------------- ------------------ -----------------
The statement of financial position as at 31 October 2021 has been restated to reflect the prior year adjustment to deferred tax as detailed in note 26 of the Group's financial statements for the year ending 30 April 2022.
Condensed consolidated statement of cash flows
6 months 6 months 12 months
to 31 Oct to to 30 Apr
2022 (unaudited) 31 Oct 2022 (audited)
GBP'000 2021 (unaudited) GBP'000
GBP'000
----------------------------------------- ------------------ ------------------ ----------------
Cash flows from operating activities
Operating profit 3,485 2,285 4,372
Depreciation of property, plant
and equipment 2,845 2,482 5,282
Amortisation of intangible assets 58 53 101
Depreciation of investment property 5 5 9
(Profit)/loss on disposal of property,
plant and equipment (96) 2 (122)
Share-based payment expense 121 156 174
----------------------------------------- ------------------ ------------------ ----------------
Operating cash flows before movement
in working capital 6,418 4,983 9,816
Increase in inventories (318) (1,126) (750)
Increase in trade and other receivables (9,068) (1,071) (2,074)
Increase/(decrease) in trade and
other payables 5,185 (130) 1,280
Increase in provisions 310 97 102
----------------------------------------- ------------------ ------------------ ----------------
Cash generated from operations 2,527 2,559 8,374
Income tax received 322 - -
----------------------------------------- ------------------ ------------------ ----------------
Net cash generated from operating
activities 2,849 2,559 8,374
----------------------------------------- ------------------ ------------------ ----------------
Cash flows from investing activities
Purchases of property, plant and
equipment (3,745) (2,203) (4,946)
Disposal of property, plant and
equipment 197 253 384
Purchase of intangibles - - (176)
Deferred consideration for acquisition (50) - -
of subsidiary
Net cash absorbed in investing
activities (3,598) (1,950) (4,738)
----------------------------------------- ------------------ ------------------ ----------------
Cash flows from financing activities
Dividends paid (1,067) - -
New loans and borrowings 3,000 - -
New hire purchase financing 1,544 - -
Repayment of bank borrowings - (654) (812)
Principal paid on lease liabilities (1,072) (1,762) (3,637)
Interest paid on lease liabilities (179) (314) (608)
Interest paid on loans and borrowings (21) (53) (110)
Net cash absorbed in financing
activities 2,205 (2,783) (5,167)
----------------------------------------- ------------------ ------------------ ----------------
Net increase/(decrease) in cash
and cash equivalents 1,456 (2,174) (1,531)
Cash and cash equivalents at beginning
of year 6,987 8,518 8,518
Cash and cash equivalents at end
of year 8,443 6,344 6,987
----------------------------------------- ------------------ ------------------ ----------------
Condensed consolidated statement of changes in equity
Share Share Other Retained Total
Capital premium reserve earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------- --------- --------- --------- ----------- ---------
Balance at 1 May 2021 2,133 8,633 5,807 28,004 44,577
(as restated, audited)
-------------------------- --------- --------- --------- ----------- ---------
Total comprehensive
income - - - 1,469 1,469
Share-based payment
expense - - - 156 156
Balance at 31 October
2021
(as restated, audited) 2,133 8,633 5,807 29,629 46,202
-------------------------- --------- --------- --------- ----------- ---------
Total comprehensive
income - - - 391 391
Share-based payment
expense - - - 18 18
Balance at 30 April
2022 2,133 8,633 5,807 30,038 46,611
(audited)
-------------------------- --------- --------- --------- ----------- ---------
Total comprehensive
income - - - 2,820 2,820
Share-based payment
expense - - - 121 121
Dividends paid - - - (1,067) (1,067)
Balance at 31 October
2022 2,133 8,633 5,807 31,912 48,485
(unaudited)
-------------------------- --------- --------- --------- ----------- ---------
Notes to the condensed consolidated interim financial statements
For the six months ended 31 October 2022
1. Basis of preparation
The unaudited interim consolidated statement of Van Elle Holdings plc is for the six months ended 31 October 2022 and does not comprise statutory accounts within the meaning of section 435 of the Companies Act 2006. These condensed consolidated financial statements have been prepared in compliance with the recognition and measurement requirement of International Accounting Standards in conformity with the requirements of the Companies Act 2006. They do not include all disclosures that would otherwise be required in a complete set of financial statements and should be read in conjunction with the Group's annual report. The unaudited interim consolidated statement has been prepared in accordance with the accounting policies that are expected to be applied in the report and accounts for the year ending 30 April 2023.
The comparative figures for the year ended 30 April 2022 do not constitute statutory accounts within the meaning of section 435 of the Companies Act 2006, but they have been derived from the audited financial statements for that year, which have been filed with the Registrar of Companies. The report of the auditors was unqualified and did not contain statements under section 498 (2) or (3) of the Companies Act 2006 nor a reference to any matters which the auditor drew attention by way of emphasis of matter without qualifying their report.
Going Concern
As part of the going concern assessment for the year ended 30 April 2022 detailed forecasts were prepared. These forecasts demonstrated a healthy cash flow and headroom across the period to 31 August 2023. Reverse stress testing was also carried out and the scenarios in which cash resources were exhausted and further debt facilities were required were considered remote.
Strong activity levels seen throughout FY2022 have continued during H1 of FY2023 with 34% growth in revenues in the 6 months ending 31 October 2022 compared with H1 FY2022. Operating profit margins have also increased in the 6 months ending 31 October 2022 compared with H1 FY2022. The Group's order book has also grown in the period since 30 April 2022.
A strong cash balance of GBP8.4m remains at the end of the period. The Group's net funds position (excluding IFRS 16 property and vehicle lease liabilities) of GBP3.5m has reduced by GBP2.4m during the period as GBP1.5m of new hire purchase finance and GBP3m of the Group's GBP11m asset backed lending facility was drawn to support working capital growth and capital investment as a result of significant revenue growth. Total hire purchase finance at the end of the period was GBP2.0m.
As part of the interim going concern assessment, forecasts for the 12 months ending January 2024 have been prepared which demonstrate that the Group is able to operate within its existing facilities and meet obligations as they fall due.
On this basis the Board consider the Group to have adequate resources to continue its operations for the foreseeable future. Accordingly, the Board continue to adopt the going concern basis in preparing the interim financial statements.
Accounting Policies
The accounting policies adopted in the preparation of the unaudited Group interim consolidated statement to 31 October 2022 are consistent with the policies applied by the Group in its consolidated financial statements as at, and for the year ended 30 April 2022.
Functional currency
The unaudited interim consolidated statements are presented in Sterling, which is also the Group's functional currency. Amounts are rounded to the nearest thousand, unless otherwise stated.
2. Segment information
The Group evaluates segmental performance based on profit or loss from operations calculated in accordance with IFRS but excluding non-underlying items. Inter-segment sales are priced along the same lines as sales to external customers, with an appropriate discount being applied to encourage use of Group resources at a rate acceptable to local tax authorities. Head office central services costs including insurances are allocated to the segments based on levels of turnover. All turnover and operations are based in the UK.
Operating segments - 6 months to 31 October 2022
Specialist Ground
General Piling Engineering Head
Piling & Rail Services Office Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------- --------- ----------- ------------- --------- ---------
Revenue 29,308 24,806 26,552 170 80,836
----------------------------- --------- ----------- ------------- --------- ---------
Other operating
income - - - 169 169
----------------------------- --------- ----------- ------------- --------- ---------
Operating profit 2,325 1,102 2,541 (2,483) 3,485
Finance expense - - - (200) (200)
Profit before tax 2,325 1,102 2,541 (2,683) 3,285
----------------------------- --------- ----------- ------------- --------- ---------
Assets
Property, plant and
equipment (including
right of use assets) 9,166 13,988 7,967 9,028 40,149
Intangible assets 15 3,543 229 - 3,787
Inventories 1,319 781 1,913 78 4,091
----------------------------- --------- ----------- ------------- --------- ---------
Reportable segment
assets 10,500 18,312 10,109 9,106 48,027
Investment property - - - 806 806
Trade and other receivables - - - 43,181 43,181
Cash and cash equivalents - - - 8,443 8,443
Total assets 10,500 18,312 10,109 61,536 100,457
----------------------------- --------- ----------- ------------- --------- ---------
Liabilities
Trade and other payables - - - 27,636 27,636
Provisions - - - 8,047 8,047
Loans & borrowings - - - 3,000 3,000
Deferred consideration - - - 1,193 1,193
Lease liabilities - - - 7,957 7,957
Deferred tax - - - 4,139 4,139
Total liabilities - - - 51,972 51,972
----------------------------- --------- ----------- ------------- --------- ---------
Other information
Capital expenditure 459 2,430 197 659 3,745
Depreciation/amortisation 675 1,110 689 434 2,908
----------------------------- --------- ----------- ------------- --------- ---------
There are no individual customers accounting for more than 10% of Group revenue in either the current or preceding period.
Operating segments - 6 months to 31 October 2021
Specialist Ground
General Piling Engineering Head
Piling & Rail Services Office Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------- --------- ----------- ------------- --------- ---------
Revenue 18,067 22,140 19,790 64 60,061
----------------------------- --------- ----------- ------------- --------- ---------
Other operating income - - - 125 125
----------------------------- --------- ----------- ------------- --------- ---------
Operating profit 898 1,646 1,208 (1,467) 2,285
Finance expense - - - (368) (368)
Profit before tax 898 1,646 1,208 (1,835) 1,917
----------------------------- --------- ----------- ------------- --------- ---------
Assets
Property, plant and
equipment (including
right of use assets) 8,285 12,852 8,300 8,839 38,276
Intangible assets 22 3,447 246 5 3,720
Inventories 1,691 1,323 1,116 18 4,148
Reportable segment
assets 9,998 17,622 9,662 8,862 46,144
Investment property - - - 815 815
Trade and other receivables - - - 33,193 33,193
Cash and cash equivalents - - - 6,344 6,344
Total assets 9,998 17,622 9,662 49,214 86,496
----------------------------- --------- ----------- ------------- --------- ---------
Liabilities
Trade and other payables - - - 20,703 20,703
Provisions - - - 7,538 7,538
Loans & borrowings - - - 158 158
Deferred consideration - - - 1,547 1,547
Lease liabilities - - - 8,197 8,197
Deferred tax - - - 2,743 2,743 Total liabilities - - - 40,886 40,886 ----------------------------- --------- ----------- ------------- --------- --------- Other information Capital expenditure 211 1,568 316 108 2,203 Depreciation/amortisation 571 956 592 421 2,540 ----------------------------- --------- ----------- ------------- --------- ---------
There are no individual customers accounting for more than 10% of Group revenue in either the current or preceding period.
Operating segments - 12 months to 30 April 2022
Specialist Ground
General Piling Engineering Head
Piling & Rail Services Office Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------- --------- ----------- ------------- --------- ---------
Revenue 38,974 45,771 40,043 127 124,915
----------------------------- --------- ----------- ------------- --------- ---------
Other operating income - - - 438 438
----------------------------- --------- ----------- ------------- --------- ---------
Operating profit 1,804 2,998 2,115 (2,545) 4,372
Finance expense - - - (779) (779)
Profit before tax 1,804 2,998 2,115 (3,324) 3,593
----------------------------- --------- ----------- ------------- --------- ---------
Assets
Property, plant and
equipment (including
right of use assets) 9,341 12,589 8,145 8,644 38,719
Intangible assets 18 3,594 233 2 3,847
Inventories 1,251 1,163 1,320 39 3,773
----------------------------- --------- ----------- ------------- --------- ---------
Reportable segment
assets 10,610 17,346 9,698 8,685 46,339
Investment property - - - 811 811
Trade and other receivables - - - 34,434 34,434
Cash and cash equivalents - - - 6,987 6,987
Total assets 10,610 17,346 9,698 50,917 88,571
----------------------------- --------- ----------- ------------- --------- ---------
Liabilities
Trade and other payables - - - 22,475 22,475
Provisions - - - 7,737 7,737
Deferred consideration - - - 1,220 1,220
Lease liabilities - - - 6,854 6,854
Deferred tax - - - 3,674 3,674
Total liabilities - - - 41,960 41,960
----------------------------- --------- ----------- ------------- --------- ---------
Other information
Capital expenditure 2,097 2,462 1,207 254 6,020
Depreciation/amortisation 1,166 1,907 1,296 913 5,282
----------------------------- --------- ----------- ------------- --------- ---------
There are no individual customers accounting for more than 10% of Group revenue in either the current or preceding year.
3. Revenue from contracts with customers
Disaggregation of revenue - 6 months to 31 October 2022
Specialist Ground
General Piling Engineering Head
Piling & Rail Services Office Total
End market GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------- --------- ----------- ------------- --------- ---------
Residential 6,880 2,334 21,643 - 30,857
Infrastructure 9,166 20,337 2,095 - 31,598
Regional construction 13,222 2,100 2,772 - 18,094
Other 40 35 42 170 287
----------------------- --------- ----------- ------------- --------- ---------
Total 29,308 24,806 26,552 170 80,836
----------------------- --------- ----------- ------------- --------- ---------
Disaggregation of revenue - 6 months to 31 October 2021
Specialist Ground
General Piling Engineering Head
Piling & Rail Services Office Total
End market GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------- --------- ----------- ------------- --------- ---------
Residential 5,420 3,678 16,636 - 25,734
Infrastructure 3,916 15,958 1,956 - 21,830
Regional construction 8,731 2,392 1,198 - 12,321
Other - 112 - 64 176
----------------------- --------- ----------- ------------- --------- ---------
Total 18,067 22,140 19,790 64 60,061
----------------------- --------- ----------- ------------- --------- ---------
Disaggregation of revenue - 12 months to 30 April 2022
Specialist Ground
General Piling Engineering Head
Piling & Rail Services Office Total
End market GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------- --------- ----------- ------------- --------- ---------
Residential 13,569 6,346 33,392 - 53,307
Infrastructure 5,224 34,333 3,821 - 43,378
Regional construction 20,177 4,872 2,830 - 27,879
Other 4 220 - 127 351
----------------------- --------- ----------- ------------- --------- ---------
Total 38,974 45,771 40,043 127 124,915
----------------------- --------- ----------- ------------- --------- ---------
Contract assets
6 months 6 months 12 months
to to to
31 Oct 31 Oct 30 Apr
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
------------------------------------ --------------- -------------- ------------
As at 1 May 2,163 1,651 1,651
Transfers from contract assets
to trade receivables (2,163) (1,651) (1,651)
Excess of revenue recognised over
invoiced 3,347 1,997 2,163
Impairment of contract assets - - -
------------------------------------ --------------- -------------- ------------
As at 31 October / 30 April 3,347 1,997 2,163
------------------------------------ --------------- -------------- ------------
Contract liabilities
6 months 6 months 12 months
to to to 30 Apr
31 Oct 31 Oct 2022 (audited)
2022 (unaudited) 2021 (unaudited) GBP'000
GBP'000 GBP'000
---------------------------------- ------------------ ------------------ ----------------
As at 1 May 388 284 284
Interest on contract liabilities - - -
Contract liabilities recognised
as revenue in the period (188) (84) (84)
Deposits received in advance of
performance 247 49 188
As at 31 October / 30 April 447 249 388
---------------------------------- ------------------ ------------------ ----------------
4. Earnings per share
The calculation of basic and diluted earnings per share is based on the following data:
6 months 6 months 12 months
to to to 30 Apr
31 Oct 31 Oct 2022 (audited)
2022 (unaudited) 2021 (unaudited)
---------------------------------- ------------------ ------------------ ----------------
Basic weighted average number
of shares 106,667 106,667 106,667
---------------------------------- ------------------ ------------------ ----------------
GBP'000 GBP'000 GBP'000
---------------------------------- ------------------ ------------------ ----------------
Profit for the period 2,820 1,469 1,860
---------------------------------- ------------------ ------------------ ----------------
Add back/(deduct):
Non-underlying items - - -
Underlying profit for the period 2,820 1,469 1,860
---------------------------------- ------------------ ------------------ ----------------
Pence Pence Pence
---------------------------------- ------------------ ------------------ ----------------
Earnings per share
Basic 2.6 1.4 1.7
Diluted 2.6 1.4 1.7
Basic - adjusted(1) 2.6 1.4 2.7
Diluted - adjusted 2.6 1.4 2.7
---------------------------------- ------------------ ------------------ ----------------
There is no dilutive effect of the share options as the performance conditions remain unsatisfied or the share price was below the exercise price.
The calculation of the basic earnings per share is based on the earnings attributable to ordinary shareholders and on 106,666,650 ordinary shares being the weighted average number of ordinary shares.
(1) The adjusted earnings per share in the year ended 30 April 2022 is based on profit for the year adjusted for corporation tax rate changes amounting to GBP1,072,000. This tax rate change is a one-off deferred tax charge relating to future corporation tax rate changes enacted during the year. The Directors consider this measure provides an additional indicator of the underlying performance of the Group.
5. Dividends paid
6 months 6 months 12 months
to to to
31 Oct 31 Oct 30 Apr
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
--------------------------------------- --------------- -------------- ------------
Amounts recognised as distributions
to equity holders during the Period:
Final dividend for the year ended 1,067 - -
30 April 2022 of 1.0p per share
Total 1,067 - -
--------------------------------------- --------------- -------------- ------------
6. Analysis of cash and cash equivalents and reconciliation to net (debt)/funds
As at As at As at
31 Oct 31 Oct 30 Apr
2022 (unaudited) 2021 (unaudited) 2022
GBP'000 GBP'000 (audited)
GBP'000
---------------------------------- ------------------- ------------------- -----------
Cash at bank 8,403 6,303 6,948
Cash in hand 40 41 39
---------------------------------- ------------------- ------------------- -----------
Cash and cash equivalents 8,443 6,344 6,987
Loans and borrowings (3,000) (159) -
Lease liabilities (7,957) (8,197) (6,853)
---------------------------------- ------------------- ------------------- -----------
Net (debt)/funds (2,514) (2,012) 134
---------------------------------- ------------------- ------------------- -----------
Net funds excl. IFRS 16 property
and vehicle lease liabilities 3,476 3,479 5,934
---------------------------------- ------------------- ------------------- -----------
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END
IR EAPFLAFADEFA
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January 25, 2023 02:00 ET (07:00 GMT)
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