RNS No 4588q
CARISBROOKE SHIPPING PLC
24th February 1998
Carisbrooke Shipping PLC
("Carisbrooke" or the "Company")
Results for the year ended 31 December 1997
* As previously foreshadowed, profits reduced by strength of sterling
* Balance sheet strengthened and gearing greatly reduced by sale of ships,
but management retained
* Further new ships on order for joint venture
* Inappropriate to pay final dividend following interim 1p
Commenting today Peter Nicholson, Chairman, said:
"1997 has been the most challenging year Carisbrooke has yet faced. In my
chairman's statement last year, I referred to the problems caused for us by
the increasing strength of Sterling against the currencies of our main
competitors in Germany and Holland.
In the interim statement, I explained in some detail the precise effect that
the continuing high value of Sterling was having on our company and the steps
which your directors had put in hand to mitigate the problem.
When I reported to you in September, Sterling had fallen back very slightly
from its summer peak and we were hopeful that this trend might continue.
Regrettably, however, the reverse proved to be the case and the pound is now
35% higher against the Deutschmark and the Guilder than it was when the
company obtained its AIM quotation in the summer of 1996.
An illustration of this problem is that in mid 1996, a German ship owner could
quote 50 Deutschmarks per tonne for a particular cargo and we could quote up
to #22 and remain competitive. If the German quotes the same price in
Deutschmarks today, we can only quote #17 per tonne and remain competitive.
This represents a reduction in income of #12,500 on just one voyage, for one
of our 2,500 dwt ships.
I am very glad to be able to report that our most important UK customers have
remained loyal to Carisbrooke on account of the excellent service we have
given them in previous years. Nevertheless, our gross income fell slightly
during 1997 from #12.7m to #12.2m, operating profit fell from #1.3 to #1.1m
and after an exceptional loss on the disposal of vessels, which was
foreshadowed in the interim statement, we show a pre-tax loss for the year of
#1.59m. Full details of the transactions which led to this figure, are set
out in the accounts.
The sale of three ships to a Dutch investment company was duly completed
before the end of the year and has enabled us to repay #11m of debt and reduce
gearing from 151% last year end to 17% at 31 December 1997. It also leaves us
with a substantial sum of free cash with which we can pursue further our
strategy, of increasing our ship management income by adding more new and good
quality vessels to our fleet, in which the equity will be shared with other
investors.
In pursuit of this policy, and as I also reported at the interim stage, we
have two new ships on order for delivery in the second half of this year. We
are seriously considering the possibility of a third new ship which has been
offered to us on attractive terms and are keeping a close watch on
opportunities in older tonnage. It is our intention that these ships will be
placed in investment companies, in which Carisbrooke will hold a minority
interest, and take management responsibility on terms which will provide us
with a fixed management fee plus a share of profits.
As a result of these developments, 1998 will be a year of consolidation. The
full benefits of the reorganisation will not appear until 1999 but, in the
meantime, the company should be able to trade at a modest profit, even if
Sterling remains at its current level. Costs are being very tightly
controlled and reductions are being made wherever these are possible without
affecting the operating efficiency or safety of the fleet.
At the half-year when announcing a maintained interim dividend, I said that
the directors hoped that improved trading on the back of a falling pound in
the second half of the year, would enable us to pay a reasonable dividend for
the year as a whole. Our cash position is strong and the directors have
seriously considered recommending the payment of a final dividend of 1p.
This would, however, cost approximately #125,000, including tax, and after
very careful further thought, we have decided that it will be more in the
interests of shareholders to retain this cash in the business, with the
intention of using it towards some of the attractive investment opportunities
which are now beginning to be offered to us, as a result of the recent
upheavals in currencies and markets around the world.
Although 1997 has been a very disappointing year for shareholders, it has been
one of very hard work and considerable achievement by our management and
employees. They have shown great dedication to Carisbrooke and our executive
directors, Willem Wester, Ian Walker and Ron Robson have worked tirelessly and
very creatively to re-organsise the business."
A copy of the profit & loss account, balance sheet and cash flow statement are
attached.
Enquiries to:
Willem Wester Carisbrooke Shipping PLC 01983 284100
Managing Director
Ron Robson Carisbrooke Shipping PLC 01983 284100
Finance Director
Ian Dighe Singer & Friedlander Ltd 0171 623 3000
Director
Copies of their announcement may be obtained for at least the next 14 days
from the offices of Carisbrooke Shipping PLC at 10 Mill Hill Road, Cowes, Isle
of Wight, PO31 7EA
Carisbrooke Shipping PLC and its Subsidiaries
CONSOLIDATED PROFIT AND LOSS ACCOUNT
for the year ended 31 December 1997
Before Exceptional 1997 1996
Exceptionals Items Total Total
# # # #
Turnover 12,184,499 - 12,184,499 12,711,560
Cost of sales (10,457,034) - (10,457,034) (10,783,074)
Gross profit 1,727,465 - 1,727,465 1,928,486
Administrative expenses (434,593) - (434,593) (373,404)
Other operating charges (387,709) - (387,709) (283,197)
Other operating income 164,092 - 164,092 73,080
(658,210) - (658,210) (583,521)
Operating Profit 1,069,255 - 1,069,255 1,344,965
Share of results of (28,256) - (28,256) 121,400
associated undertakings
Exceptional loss on
disposal of vessels - (1,765,921) (1,765,921) -
Interest receivable 2,039 - 2,039 24,911
Interest payable (869,275) - (869,275) (473,885)
Profit/(loss)on ordinary
activities before tax 173,763 (1,765,921) (1,592,158) 1,017,391
Tax on profit/(loss) on
ordinary activities (24,060) (88,704)
Profit/(loss) for the year (1,616,218) 928,687
after tax
Equity minority interests (36,857) (74,091)
(1,653,075) 1,002,778
Equity dividends (101,375) (354,814)
Retained profit/(loss) for (1,754,450) 647,964
the year
Earnings/(loss) per share (16.31)p 10.88p
Carisbrooke Shipping PLC and its Subsidiaries
GROUP BALANCE SHEET
as at 31 December 1997
1997 1997 1996 1996
# # # #
Fixed assets
Tangible assets 6,021,595 20,369,541
Investments 1,211,004 517,521
7,232,599 20,887,062
Current assets
Stock 174,293 160,049
Debtors
- due within one year 2,256,776 2,106,406
- due after more than one 100,000 250,000
year
Cash at bank and in hand 1,182,088 82,678
3,713,157 2,599,133
Creditors: amounts falling
due within one year (2,852,766) (4,377,082)
Net current
assets/(liabilities) 860,391 (1,777,949)
Total assets less current 8,092,990 19,109,113
liabilities
Creditors: amounts falling
due after
more than one year (1,642,500) (10,926,030)
#6,450,490 #8,183,083
Capital and reserves
Called up share capital 5,068,775 5,068,775
Share premium account 1,092,322 1,107,322
Revaluation reserve 31,117 31,117
Profit and loss account 249,182 2,003,632
Equity shareholders' funds 6,441,396 8,210,846
Equity minority interests 9,094 (27,763)
#6,450,490 #8,183,083
GROUP CASH FLOW STATEMENT
for the year ended 31 December 1997
1997 1997 1996 1996
# # # #
Net cash inflow from operating 1,701,574 1,418,094
activities
Returns on investments and
servicing
of finance
Interest received 2,039 24,911
Interest paid
(869,275) (557,804)
(867,236) (532,893)
Taxation (87,420) (40,886)
Capital expenditure and financial
investment
Purchase of tangible fixed assets (1,288,604) (8,844,842)
Sale of tangible fixed assets 12,867,312 314,332
Purchase of investments (721,739) -
Increase in loans to associated - (544,999)
undertakings
Decrease in loans from other (14,000) -
entities
10,842,969 (9,075,509)
Acquisitions and disposals
Purchase of remaining 50% of
associated undertaking - (597,856)
Investment in associated
undertaking - (1)
(597,857)
Equity dividends paid (354,814) (259,682)
Financing
Minority interest in subsidiary - 2,000
acquired
New bank loans 527,893 9,877,862
New loans from minority interests - 13,000
Repayment of bank loans (11,086,924) (2,527,258)
Repayment of hire purchase loan (1,466) (10,341)
Net proceeds of share issue (15,000) 1,698,929
(10,575,497) 9,054,192
Increase/(decrease) in cash
659,576 #(34,541)
1. Earnings/(loss) per share
1997 1996
Basic earnings/(loss) per share (16.31)p 10.88p
The calculation of earnings/(loss) per share is based on the loss after
taxation and minority interests for the year of #1,653,075 (1996 profit -
#1,002,778) and an average of 10,137,549 (1996 - 9,220,731) ordinary shares of
50p each being the weighted average number in issue during the year ended 31
December 1997.
2. Debt and net assets per share
As at 31 December 1997
1997 1996
Net debt #1,129,897 #12,396,032
Gearing (net debt/shareholders' funds) 17% 151%
Net assets per share 63.5p 80.9p
The calculation of net assets per share is based on the equity shareholders'
funds of the Group at the year end and 10,137,549 ordinary shares of 50p each
being the number of ordinary shares of 50p each in issue at the years ended 31
December 1997, 1996.
3. Reconciliation of movements in equity shareholders' funds
1997 1996
# #
Results for the financial year after tax and (1,653,075) 1,002,778
minority interests
Equity dividends (101,375) (354,814)
Net proceeds of share issue (15,000) 1,698,929
Net increase/(decrease) in equity shareholders' (1,769,450) 2,346,893
funds
Equity shareholder's funds at 1 January 1997 8,210,846 5,863,953
Equity shareholders' funds at 31 December 1997 #6,441,396 #8,210,846
4. Statutory Accounts
The financial information set out above does not constitute the group's
statutory financial statements for the years ended 31 December 1996 or 1997
but is derived from those financial statements. Statutory financial
statements for 1996 have been delivered to the Registrar of Companies, whereas
those for 1997 will be delivered following the Annual General Meeting. The
auditors have reported on those financial statements; their reports were
unqualified and did not contain a statement under sections 237(2) or (4) of
the Companies Act 1985.
5. Annual General Meeting
The Annual General Meeting will be held at the Royal Corinthian Yacht Club,
The Parade, Cowes, Isle of Wight on Friday 27 March 1998 at 11.30 hours.
END
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