TIDMESR
10 June 2015
ENSOR HOLDINGS PLC
Preliminary results for the year ended 31 March 2015
CHAIRMAN'S STATEMENT
* Sales up 18% to GBP36.1m
* Operating profit up 84% to GBP3.4m
* Earnings per share up 114% to 9.2p per share
* Dividend up 27% to 1.9p per share
The Ensor Group has again made significant progress in the second half of our
financial year, exceeding expectations when I reported to you at the time of
our interim results. Total revenues have increased by 18% to GBP36.1m (2014: GBP
30.6m) and our operating profits have increased by 84% to GBP3.4m (2014: GBP1.8m).
The current year has started well and I am cautiously optimistic about the year
ahead.
Technocover, our subsidiary which manufactures physical high security products
for the Utilities sector has finished the year strongly. This year the company
has completed large programmes of work particularly for the water industry,
which is at the end of its current Asset Management Period (AMP). Nevertheless,
the company carries a good forward order book into the new AMP period. We have
invested substantially into new equipment on the Welshpool site, demonstrating
our confidence in the business and markets that the company operates within.
Our company Ellard, which supplies electric motors, automation and accessories
for doors and gates has greatly improved its position within its sector
increasing its share of an expanding market. Investment into a graduate
recruitment programme, new products and planned expansion of the premises
occupied by Ellard, have been initiated in anticipation of continuing buoyant
markets.
OSA supplies ready to install industrial sectional overhead doors, residential
garage doors, rapid roll doors, steel hinged doors and repair materials to the
same market as Ellard and has had a similarly progressive year. Good
relationships with suppliers and customers and product advances continue to
build on the solid foundations at OSA.
Our packaging and logistics consumables supplier, Wood's Packaging has
benefitted from a strong retail sector and competitive sourcing of products via
our office in China. Generating robust profits supported by healthy cash flows,
Wood's continues to complement our security orientated businesses.
Ensor Building Products distributes specialist roofing and drainage products.
Supplying the merchant trade and contractors, the company has seen growth in
its market as the construction industry improves. Discussions have taken place
with the company's management for them to buy 100% of the shares of the
business. The transaction is progressing and, if concluded, the sale should
include an appropriate value for goodwill. This disposal further focuses the
Group towards its physical security activities.
At the end of May this year, we completed, as anticipated, the sale of our land
in the Stockport area. This realised a significant premium to the carrying
value. During April this year we also sold, at a premium, our Woodville,
Derbyshire site. As completion of these transactions occurred after the year
end, the profit on the sales will be shown in next year's figures.
Additionally, I am able to report that we are expecting to be granted planning
permission for a residential scheme at our Brackley site. This has been a long
term project but we hope to report an outcome in due course.
I am pleased to again report that we are proposing to pay an increased net
final dividend of 1.3p per share, making a total dividend paid and proposed of
1.9p per share for the year. This is a 27% increase on last year's total
dividends of 1.5p per share. The dividend will be paid in cash only, on 7
August 2015, to shareholders registered on 26 June 2015.The ex-dividend date
will be 25 June 2015.
On 27 May 2015, we announced that we were launching a review of strategic
options open to us to maximise value for shareholders including a potential
sale of the Group. The process is at an early stage and further announcements
will be made in due course.
Finally, I would like to once again thank everyone who works in all the
different departments around our Group. Your contribution and sustained efforts
are greatly appreciated and your interests are important to me. My thanks also
to our shareholders, customers and suppliers for their continued support.
K A Harrison TD
Chairman
9 June 2015
Strategic Report
______________________________________________________________________________________
Operating results and future developments
Our Building & Security Products division experienced a strong year, with
turnover almost 20% higher than the previous year. Operating profit increased
by 95%, before allocation of holding company overhead. Most of the increase was
contributed by Technocover, however profit growth in the division's other
businesses ranged between 40% and 108%, reflecting strong performances across
the board.
As anticipated last year, Technocover benefitted from a surge in water company
orders as Ofwat's AMP5, asset management period, drew to a close in March 2015,
resulting in a GBP4.6m rise in invoiced sales.
The gross margin was maintained and overheads were contained, meaning that the
company contributed GBP1.1m more to the division's result, than in the previous
year.
Although AMP5 has concluded, a carry-over of orders has resulted in an
unusually strong order book to support the company's results into the current
year as the new AMP6 programme gets underway.
Within the same operating segment, Ellard also performed well, benefitting from
continued growth in market share and a key supply agreement securing exclusive
rights to supply certain products within the UK. The company's turnover
increased by GBP1m and margins held firm resulting in a 42% increase in operating
profit.
OSA Door Parts, also within the Building & Security Products division,
experienced another year of healthy growth in turnover and margin and a 40%
increase in operating profit.
The fourth member of the same division, Ensor Building Products, saw a
constructive reduction in turnover, as a continued focus on higher margin
products underlay a 108% operating profit increase.
Negotiations have taken place with the company's management in the months
leading up to the date of this report to agree a sale of the business to the
management, and the transaction is progressing.
Our Packaging business, Wood's Packaging, also performed well, achieving a 21%
increase in turnover and an additional GBP124,000 of operating profit, after
allocation of holding company overhead.
Overall, sales growth of GBP5.6m and tight control over margins resulted in a
year-on-year increase in operating profit of GBP1.5m for the group.
Finance costs
Finance costs comprise bank loan and overdraft interest, the financing cost on
the defined benefit pension scheme and unwinding of the discount on the
deferred consideration payable on the acquisition of Technocover.
We recognised a credit of GBP198,000 during the year in respect of an interest
hedge on a bank loan, which had been the subject of a mis-selling claim. As a
result of this, loan interest has reduced by the annual cost of the hedge as
well as by the ongoing reduction in the outstanding balance, which is being
paid in instalments up to January 2017.
The interest cost of the pension fund has reduced from GBP112,000 to GBP89,000.
The deferred consideration on the acquisition of Technocover of GBP1m was paid
earlier than had previously been anticipated, resulting in an accelerated
finance cost in the year of GBP22,000.
Income tax
The tax charge of GBP654,000 represents 19.6% of operating profit, varying from
the main UK corporation tax rate of 21% principally as a result of a prior year
overprovision.
Cash flow and financial position
Cashflows generated from operations before changes in working capital amounted
to GBP3.9m. However, increases in receivables and inventories and reductions in
payables eliminated much of this surplus.
These working capital changes have been particularly influenced by:
* a very strong finish to the year, reflected in the GBP2.6m increase in trade
receivables which are not past due
* investments in inventories at Ellard in relation to new products, and
elsewhere to service higher sales levels
* accelerated payment for foreign supplies to secure improved costs
A significant element of this increase is expected to unwind in the first half
of the current year.
Operating cashflows also include contributions of GBP617,000 to the group's
defined benefit pension scheme. Normal contributions of GBP301,000 were
supplemented by payments of GBP250,000 in respect of severing subsidiary company
obligations and GBP66,000 in respect of liability-reducing member transfers from
the scheme.
After payment of corporation tax, net cash generated from operations totalled GBP
184,000.
The group's property at Normanton, occupied by a former subsidiary, CMS Tools
Limited, was sold in September 2014 for GBP600,000 and other assets sales
totalled GBP139,000.
Technocover invested significantly in its production and distribution
infrastructure, and combined with other investment around the group, capital
expenditure totalled GBP746,000.
After allowing for the advanced payment of the deferred consideration of GBP1m,
referred to above, dividends of GBP479,000 and loan repayments, the group's cash
position decreased by GBP1.6m during the year.
Net assets have increased by 19% to GBP11.5m.
Disposals after the year end
On 1 April 2015, the whole of our operation at Woodville, Derbyshire, including
the Waste Transfer Facility and freehold land and buildings, was disposed of
for GBP1.8m in cash.
On 1 June 2015, the freehold property at Stockport was sold to a residential
property developer for GBP1.3m. The property had previously been occupied by the
group's rubber crumb recycling business, which was sold in January 2014.
Both properties are classified as held-for-sale in the balance sheet.
Dividend
The directors propose to pay a final dividend of 1.3p per share in respect of
the financial year ended 31 March 2015 (2014: 1.0p). Dividends of GBP479,000
were paid on ordinary shares during the year ended 31 March 2015 (2014: GBP
389,000).
Dividends paid and proposed
In respect of the year ended 31 March: 2015 2014
Interim dividend paid 0.6p 0.50p
Final dividend proposed 1.3p 1.00p
______ ______
1.9p 1.50p
______ ______
Consolidated Income Statement
for the year ended 31 March 2015
_____________________________________________________________________________
2015 2014
GBP'000 GBP'000
Continuing operations
Revenue 36,136 30,558
Cost of sales (26,766) (23,081)
______ ______
Gross profit 9,370 7,477
Administrative expenses (6,006) (5,650)
______ ______
Operating profit 3,364 1,827
Finance costs (34) (301)
______ ______
Profit before tax 3,330 1,526
Income tax expense (654) (242)
______ ______
Profit for the year on continuing operations 2,676 1,284
Discontinued operation - (182)
______ ______
Profit for the year attributable to equity 2,676 1,102
shareholders of the parent company
______ ______
Earnings per share - basic and diluted
Continuing operations 9.2p 4.3p
Discontinued operation - (0.6p)
______ ______
9.2p 3.7p
______ ______
Consolidated Statement of Comprehensive Income
2015 2014
GBP'000 GBP'000
Profit for the year 2,676 1,102
_____ _____
Actuarial gain/(loss) (403) 305
Income tax relating to components of other comprehensive 60 (115)
income
___ ___ __
__
Total of other comprehensive income for the year (343) 190
____ ____ _
_
___ ___ __
__
Total comprehensive income attributable to equity 2,333 1,292
shareholders of the parent company
___ ___ __
__
Consolidated Statement of Financial Position
at 31 March 2015
______________________________________________________________________________________
2015 2014
GBP'000 GBP'000
ASSETS
Non-current assets
Property, plant & equipment 4,170 6,413
Intangible assets 2,671 2,704
Deferred tax asset 428 475
______ ______
Total non-current assets 7,269 9,592
______ ______
Current assets
Assets held for sale 2,185 496
Assets of disposal group held for sale 1,975 -
Inventories 3,063 2,646
Trade and other receivables 8,381 6,515
Cash and cash equivalents 564 585
______ ______
Total current assets 16,168 10,242
______ ______
Total assets 23,437 19,834
______ ______
LIABILITIES
Non-current liabilities
Retirement benefit obligations (2,139) (2,264)
Borrowings (246) (533)
Other creditors (22) (986)
Deferred tax (182) (73)
______ ______
Total non-current liabilities (2,589) (3,856)
______ ______
Current liabilities
Borrowings (1,863) (275)
Liabilities of disposal group held for sale (946) -
Current income tax liabilities (561) (378)
Trade and other payables (6,028) (5,729)
______ ______
Total current liabilities (9,398) (6,382)
______ ______
Total liabilities (11,987) (10,238)
______ ______
NET ASSETS 11,450 9,596
______ ______
EQUITY
Share capital 3,082 3,082
Share premium 552 552
Revaluation reserve 140 140
Retained earnings 7,676 5,822
______ ______
Total equity attributable to equity shareholders of the 11,450 9,596
parent company
______ ______
The financial statements were approved by the board and were authorised for
issue on 9 June 2015. They were signed on its behalf by:
Directors
A R Harrison )
M A Chadwick )
Consolidated Statement of Changes in Equity
for the year ended 31 March 2015
Attributable to equity shareholders of the parent company
Issued Share Revaluation Retained Total
Capital Premium reserve Earnings Equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance as at 1 April 3,062 522 140 5,214 8,938
2013
_____ _____ _____ _____ _____
Profit for the year - - - 1,102 1,102
Other comprehensive
income:
Actuarial gain - - - 305 305
Related deferred tax - - - (115) (115)
_____ _____ _____ _____ _____
Total comprehensive - - - 1,292 1,292
income for the year
_____ _____ _____ _____ _____
Issue of shares 20 30 - - 50
Purchase of treasury - - - (295) (295)
shares
Dividends paid - - - (389) (389)
_____ _____ _____ _____ _____
Total transactions 20 30 - (684) (634)
recognised directly in
equity
_____ _____ _____ _____ _____
Balance at 31 March 3,082 552 140 5,822 9,596
2014
_____ _____ _____ _____ _____
Balance as at 1 April 3,082 552 140 5,822 9,596
2014
_____ _____ _____ _____ _____
Profit for the year - - - 2,676 2,676
Other comprehensive
income:
Actuarial gain - - - (403) (403)
Related deferred tax - - - 60 60
_____ _____ _____ _____ _____
Total comprehensive - - - 2,333 2,333
income for the year
_____ _____ _____ _____ _____
Dividends paid - - - (479) (479)
_____ _____ _____ _____ _____
Total transactions - - - - -
recognised directly in
equity
_____ _____ _____ _____ _____
Balance at 31 March 3,082 552 140 7,676 11,450
2015
_____ _____ _____ _____ _____
Share premium
The share premium account represents the consideration that has been received
in excess of the nominal value of shares on issue of new ordinary share
capital, less permitted expenses.
Revaluation reserve
The revaluation reserve represents the unrealised surplus arising on the
revaluation of certain of the group's freehold properties.
Retained earnings
The retained earnings reserve represents profits and losses retained in the
current and previous periods.
Consolidated Cash Flow Statement
for the year ended 31 March 2015
______________________________________________________________________________________
2015 2014
GBP'000 GBP'000
Net cash generated from operations 184 2,468
_______ _______
Cash flows from investing activities
Proceeds from sale of property, plant and equipment 739 97
Proceeds from sale of subsidiary - 613
Acquisition of property, plant and equipment (746) (721)
_______ _______
Net cash used in investing activities (7) (11)
_______ _______
Cash flows from financing activities
Equity dividends paid (479) (389)
Issue of shares - 50
Purchase of treasury shares - (295)
Amounts repaid in respect of finance leases (20) (20)
Deferred consideration paid (1,000) -
Loan repayments (278) (267)
_______ _______
Net cash used in financing activities (1,777) (921)
_______ _______
Net increase/(decrease) in cash and cash equivalents (1,600) 1,536
Opening cash and cash equivalents 585 (951)
_______ _______
Closing cash and cash equivalents (1,015) 585
_______ _______
Accounting Policies and Notes to the Financial Statements
for the year ended 31 March 2015
______________________________________________________________________________________
1. Basis of preparation
The consolidated financial statements of Ensor Holdings PLC have been prepared
in accordance with the Companies Act 2006 and International Financial Reporting
Standards (IFRS) as adopted by the European Union in accordance with the rules
of the London Stock Exchange for companies trading securities on the
Alternative Investment Market. The group financial statements have been
prepared under the historical cost convention, as modified by the revaluation
of land and buildings, and derivative financial instruments at fair value
through profit or loss. The principal accounting policies adopted by the group
are set out below.
2. Basis of consolidation
Where the company has control over an investee, it is classified as a
subsidiary. The company controls an investee if all three of the following
elements are present:
* power over the investee
* exposure to variable returns from the investee, and
* the ability of the investor to use its power to affect those variable
returns.
Control is reassessed whenever facts and circumstances indicate that there may
be a change in any of these elements of control.
De-facto control exists in situations where the company has the practical
ability to direct the relevant activities of the investee without holding the
majority of the voting rights. In determining whether de-facto control exists
the company considers all relevant facts and circumstances, including:
* the size of the company's voting rights relative to both the size and
dispersion of other parties who hold voting rights
* substantive potential voting rights held by the company and by other
parties
* other contractual arrangements
* historic patterns in voting attendance.
The consolidated financial statements present the results of the company and
its subsidiaries as if they formed a single entity. Intercompany transactions
and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business
combinations using the acquisition method. In the statement of financial
position, the acquiree's identifiable assets, liabilities and contingent
liabilities are initially recognised at their fair values at the acquisition
date. The results of acquired operations are included in the consolidated
statement of comprehensive income from the date on which control is obtained.
They are deconsolidated from the date on which control ceases.
3. Segmental analysis
For management purposes, the group's business activities are organised into
business units based on their products and services and have three primary
operating segments as follows:
* Building and Security Products - manufacture, marketing, supply and
distribution of building materials, security access products and access
control equipment;
* Packaging - marketing and distribution of packaging materials;
* Other - waste recycling.
These segments are the basis on which information is reported to the group
board. The segment result is the measure used for the purposes of resource
allocation and assessment and represents the operating profit of each segment
before exceptional operating costs, amortisation and impairment charges, other
gains and losses, net finance costs and taxation.
Details of the types of products and services from which each segment derives
its revenues are given above.
The accounting policies applied in preparing the management information for
each of the reportable segments are the same as the group's accounting
policies.
The group's revenues and results by reportable segment for the year ended 31
March 2015 are shown in the following table.
Building & Packaging Other Unallocated Total
Security
Products
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
External revenue 32,635 3,336 165 - 36,136
_____ _____ _____ _____ _____
Depreciation 557 28 14 - 599
_____ _____ _____ _____ _____
Operating profit 2,781 530 53 - 3,364
_____ _____ _____ _____
Finance costs (34)
Income tax expense (654)
_____
Profit for the year 2,676
_____
Total assets 19,376 2,249 55 1,757 23,437
_____ _____ _____ _____ _____
Total liabilities (7,102) (672) (5) (4,208) (11,987)
_____ _____ _____ _____ _____
Capital expenditure 619 18 1 108 746
_____ _____ _____ _____ _____
The group's revenues and results by reportable segment for the year ended 31
March 2014 are shown in the following table.
Building Packaging Other Total Discont-inued Unalloca-ted Total
& Security continuing
Products
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
External 27,215 2,758 585 30,558 1,431 - 31,989
revenue
_____ _____ _____ _____ _____ _____ _____
Depreciation 490 23 28 541 26 - 567
_____ _____ _____ _____ _____ _____ _____
Operating 1,385 437 5 1,827 106 - 1,933
profit
_____ _____ _____
Finance costs - - (301) (301)
Income tax - (25) (242) (267)
expense
Loss on disposal - (263) - (263)
_____ _____ _____ _____
Profit/(loss) 1,827 (182) (543) 1,102
for the year
_____ _____ _____ _____
Total assets 13,764 1,394 301 15,459 - 4,375 19,834
_____ _____ _____ _____ _____ _____ _____
Total (5,952) (728) (15) (6,695) - (3,543) (10,238)
liabilities
_____ _____ _____ _____ _____ _____ _____
Capital 592 33 66 691 30 - 721
expenditure
_____ _____ _____ _____ _____ _____ _____
Head office costs are apportioned to the segments on the basis of earnings.
The group operates almost exclusively in one geographical segment, being the
United Kingdom. Turnover to customers located outside the United Kingdom
accounted for less than 10% of total group turnover and has therefore not been
separately disclosed.
Revenue from a single customer did not exceed more than 10% of turnover during
the current or prior reporting periods.
4. Discontinued operations
CMS Tools Limited was sold on 14 February 2014 and the operation was classified
as discontinued in the prior year.
The results of the discontinued operations were as follows:
2014
GBP'000
Revenue 1,431
Expenses (1,325)
______
Operating profit 106
Income tax expense (25)
______
81
Loss on disposal (263)
______
Profit after tax for the year (182)
______
The net assets of the subsidiary at the date of disposal were as follows:
14 February
2014
GBP'000
Property, plant and equipment 53
Inventories 222
Trade and other receivables 323
Cash at bank 142
Trade and other payables (214)
Attributable goodwill 350
______
876
Loss on disposal (263)
______
Total consideration, satisfied in cash 613
______
Cash flows from discontinued operations
2014
GBP'000
Operating 25
Investing (18)
Proceeds of disposal 613
______
Total cashflow 620
______
On 2 January 2014, the business and assets of SRC Limited were sold as a going
concern. The business has not been classified as a discontinued operation
because it is not considered to have been a separate major line of business.
The waste transfer facility and surrounding land and buildings at Woodville,
Derbyshire, were disposed of on 1 April 2015. Again, the waste transfer
facility has not been classified as a discontinued operation because it is not
considered to have been a separate major line of business, and so its trade and
net assets of GBP50,000 remain in the "other" operating segment for 2015.
However the land and buildings, with a carrying value of GBP1,689,000, are
classified as held for sale in the balance sheet. The combined operation and
surrounding land and buildings realised GBP1,825,000.
Agreement has been reached to sell the business and assets of Ensor Building
Products Limited to management following negotiations during the months leading
up to the balance sheet date. The operation has not been classified as
discontinued because it does not represent a major line of business.
5. Earnings per share
The calculation of earnings per share for the period is based on the profit for
the period divided by the weighted average number of ordinary shares in issue,
being 29,895,976 (2014: 29,963,373).
6. Cash flow generated from operations
2015 2014
GBP'000 GBP'000
Cash flows from operating
activities
Profit for the year 2,676 1,102
attributable to equity
shareholders
Depreciation charge 599 567
Finance costs 34 301
Income tax expense 654 242
Profit on disposal of (131) (3)
property, plant & equipment
Amortisation of intangible 33 33
asset
Loss on disposal of - 263
subsidiary
_______ _______
Operating cash flow before 3,865 2,505
changes in working
capital
(Increase)/decrease in (1,208) 241
inventories
(Increase)/decrease in (2,928) 1,163
receivables
Increase/(decrease) in 637 (1,125)
payables
_______ _______
Cash generated from 366 2,784
operations
Net interest refunded 104 (158)
Income taxes paid (286) (158)
_______ _______
Net cash generated from 184 2,468
operations
_______ _______
7. Other information
The financial information set out in this preliminary announcement of results
does not constitute the company's statutory accounts for the years ended 31
March 2015 or 31 March 2014 but is derived from those accounts. Statutory
accounts for 2014 have been delivered to the Registrar and those for 2015 will
be delivered following the company's Annual General Meeting. The Independent
Auditors have reported on these accounts. Their reports were unqualified and
did not contain a statement under section 498 of the Companies Act 2006.
The Annual General Meeting of the company will be held at the company's
registered office, Ellard House, Floats Road, Manchester M23 9WB at 10.00 a.m.
on Monday 20 July 2015.
The Report and Accounts will be sent to shareholders and be available from the
company's website at www.ensor.co.uk shortly. Additional copies of the Annual
Report and of this statement will be available at the company's registered
office.
Enquiries:
Ensor Holdings PLC
Roger Harrison/Marcus Chadwick
0161 945 5953
Westhouse Securities Limited
Robert Finlay
020 7601 6100
END
Ensor (LSE:ESR)
Historical Stock Chart
From Jun 2024 to Jul 2024
Ensor (LSE:ESR)
Historical Stock Chart
From Jul 2023 to Jul 2024