Acatos & Hutcheson - Final Results
June 30 1999 - 2:36PM
UK Regulatory
RNS No 6593u
ACATOS & HUTCHESON PLC
30 June 1999
ACATOS & HUTCHESON plc
PRELIMINARY ANNOUNCEMENT OF AUDITED RESULTS
FOR THE 52 WEEKS ENDED 20 MARCH 1999
Acatos & Hutcheson plc, the edible oils and fats manufacturing and marketing
group, announces its results for the year ended 28th March 1999.
52 weeks to 28th 26 weeks to
March 1999 29th March 1998
Turnover on continuing operations #285m #140m
(Loss)/profit on ordinary activities before
taxation and before exceptional
reduction in fixed assets #1.6m (#2.9m)
Exceptional reduction in fixed assets (#6.7m) -
(Loss)/profit on ordinary activities after
taxation (#5.0m) (#2.8m)
Earnings per share (11.7p) (6.1p)
Proposed ordinary final dividend Nil Nil
STATEMENT BY THE CHAIRMAN
The results for the year show a profit of #1.6 million before charging to the
Profit & Loss Account an exceptional amount of #6.7 million, representing
various reductions in fixed asset values following a review of economic
carrying values.
Major factors affecting these results included.
Delays and cost overruns in shifting our business from the North West to
Orchard Place continued longer than expected and required a disproportionate
amount of management time. This situation is now well under control.
An overall worldwide decline in oils and fats demand caused by economic turmoil
in the Far East and South America has resulted in industry over-capacity and
poor margins everywhere. The strength of the Pound exaggerated this for UK
producers.
As forecast in my Half Year Statement the closure of our north west operations
was concluded in early January with the transfer of refined oil and bakery fat
sales departments to London. The concentration of our activities in Orchard
Place has enabled us to achieve a continued reduction in employee numbers, down
a further 13% from the half year to the date of this announcement and this
trend reduction will continue. However, my comment at the half year on the
cutting of the sterling exchange rate was premature and its subsequent rise has
reinforced the very serious adverse effect it is having on our margins. UK
margins are under severe pressure from imports and export margins are in the
main non-existent or negative.
Under our new management, factory operations at Orchard Place have greatly
improved and continue to do so. I am particularly pleased to be able to report
that our quality and service levels are now at consistently high levels after
the difficulties occasioned by production relocation.
As mentioned in my comments regarding the results for the year, our new
executive management decided after reviewing fixed asset values, and in
particular the Orchard Place refinery expansion and refurbishment overspends,
that it would be necessary to take this exceptional asset write-down into this
year's accounts.
We are confident that the operational improvements we have made in the past
year will enable us to reap the rewards when the world market conditions
improve. In the short term, trading conditions remain difficult.
In view of the results your Board does not propose a dividend for the year to
28 March 1999.
I S Hutcheson, Chairman
30th June 1999
Contacts:
Ian Hutcheson - Chairman 0171 418 1531
Jim Weir - Managing Director 0171 418 1545
Consolidated Profit and Loss Account
Year ended 28 March 1P99
52 weeks to 26week to
28 March 1999 29 March
1998
#000
Before Exceptional Total
Exceptional Reduction in
Reduction in Fixed Asset
Fixed Asset Values
Values
Turnover #'000 #'000 #'000
Group and share of joint ventures
turnover 304,024 - 304,024 144,298
Less share of joint ventures (18,995) - (18,995) (4,763)
turnover
Continuing operations 285,029 - 285,029 139,535
Discontinued operations (note 2) 4,384 - 4,384 11,366
Group turnover 289,413 - 289,413 150,901
Cost of sales (267,861) (6,670) (274,531) (137,277)
Gross profit 21,552 (6,670) 14,882 13,624
Distribution and administration
costs (21,105) - (21,105) (14,313)
Operating results
Continuing operations (314) (6,670) (6,984) (1,864)
Discontinued operations 761 - 761 1,175
Operating profit/loss (note 3) 447 (6,670) (6,223) (689)
Profit on the sale of land (note 4) 1,699 - 1,699
Losses on disposal of associate - - - (1,531)
Share ofjoint ventures' profits 890 - 890 104
Net interest (1,408) - (1,408) (781)
Profit (loss) on ordinary activities
before taxation 1,628 (6,670) (5,042) (2,897)
Taxation (charge)/ credit - - - 124
Profit (loss) for the period 1,628 (6,670) (5,042) (2,773)
Minority interest - - - 85
Retained profit/(loss) for the period 1,628 (6,670) (5,042) (2,688)
Basic earaings per ordinary share (11.7p) (6.1p)
Diluted earnings per ordinary share (11.7p) (6.1p)
*As explained in note 3 the carrying values and useful lives of fixed assets
were reviewed during the year resulting in a total charge of #6,670,000 in
respect of impairment and accelerated depreciation.
28 March 1999 29 March 1998
Fixed assets #000 #000 #000 #000
Tangible assets 59,224 75,928
Investments in joint venture companies:
Share of gross assets 24,760 15,911
Share of gross liabilities (7,007) (2,520)
17,753 13,391
Trade investment 3,058 3,058
80,035 92,377
Current assets
Stocks 14,173 17,892
Debtors 40,720 40,764
Own shares held in trust 172 165
Cash at bank 546 3,526
55,611 62,347
Current liabilities
Creditors due within one year (64,017) (71,276)
Net current liabilities (8,406) (8,929)
Total assets less current liabilities 71,629 83,448
Long term liabilities
Creditors due after more than one year (3,333) (5,875)
Provisions for liabilities and charges (605) (4,384)
(3,938) (10,259)
67,691 73,189
Capital and reserves
Called up share capital 21,910 21,891
Share premium reserve 25,494 25,455
Revaluation reserve 2,457 2,777
Profit and loss account 18,608 23,844
Own shares held by subsidiaries (778) (778)
Shareholders' funds 67,691 73,189
Approved by the board of directors on 30th June 1999
NOTES
1. Accounting policies
The summary of results for the year ended 28th March 1999 has been prepared
using accounting policies consistent with those adopted in the accounts for the
year ended 29th March 1998 other than where changes are necessary to implement
new accounting standards. These include FRS 9 - "Associates and Joint
Ventures", FRS 10 - "Goodwill and Intangible Assets", FRS 11 - "Impairment of
Fixed Assets and Goodwill", FRS 12 - "Provisions, Contingent Liabilities and
Contingent Assets" and FRS 14 - "Earnings per Share".
FRS 9 has resulted in additonal disclosures regarding joint ventures and the
effects of FRS 11 are detailed in note 3 below. Diluted earnings per share
figures are now presented in accordance with FRS 14. The effect of FRS 12 is
not material.
2. Discontinued operations
The figures for the period relate to a formerly wholly owned subsidiary, Leon
Frenkel Limited, a 50% share of which was sold on 2 June 1998. Profits from the
remaining 50% interest after this date are shown within share of joint ventures
profits in the profit and loss account.
3. Continuing operations - exceptional items within operating profit / (loss)
Included within the operating results for the year ended 28th March 1999 is a
charge of #6,670,000 relating to a reduction in fixed asset values. Of this
amount, #2,203,000 relates to accelerated depreication as a result of a
reassessment of economic lives and #4,467,000 relates to an impairment provision
in accordance with FRS 11 "Impairment of Fixed Assets and Goodwill".
4. Profit on sale of land
During the period properties were sold, including the former production sites at
Trafford and Bootle, realising a gain of #1,699,000.
5. Dividends
There are no dividends in the periods.
FINANCIAL CALENDAR 1999/2000
Reconvend annual general meeting 28th July 1999
Financial half year end 26th September 1999
Interim results Early December 1999
Financial year end 26th March 2000
Preliminary results and chariman's statement July 2000
Report and accounts posted to shareholders July 2000
The annual report an accounts will be posted to shareholders on 5th July 1999
and from that date will be available on application:
The Secretary
Acatos & Hutcheson plc
Orchard Place
London
E14 0JH
This preliminary announcement does not constitute statutory accounts within the
meaning of section 240 of the Companies Act 1985. The full statutory accounts,
on which the auditors have expressed an unqualified opinion, will be filed with
the Registrar of companies after the annual general meeting.
END
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