RNS Number:0082F
Gooch & Housego PLC
11 June 2001
FOR IMMEDIATE RELEASE 11 June 2001
GOOCH & HOUSEGO PLC
PRELIMINARY RESULTS FOR THE SIX MONTHS ENDED 31 MARCH 2001
Gooch & Housego PLC, the specialist manufacturer of precision optical
components and bespoke glass engineering items, acousto-optic devices and
instruments for measuring optical radiation, today announces preliminary
results for the six months ended 31 March 2001.
Highlights
* Excellent six month performance by the Group
* Pre tax profits increased by 67%
* Increase in earnings per share of 53%
* Increase in interim dividend to 0.9p
* Successful integration of the acquisition of NEOS Technologies Inc.
* Worldwide demand for the Group's Q-Switches continues at record
levels.
Archie Gooch, Chairman of Gooch & Housego, commented, " These results have
been achieved against a background of difficult trading conditions with
particular concern in the US of a deeper recession. Although our businesses
have not been directly affected, we are fully aware of the potential impact.
Our strategy of acquisitions in different sectors of the photonics industry
with diverse products and new geographical areas, stands us in good stead for
the future. "
For further information :
Archie Gooch / Ian Bayer 01460 52271
Gooch & Housego PLC
Tim Thompson 020 7466 5000
Buchanan Communications
CHAIRMAN'S STATEMENT
I am pleased to report further progress by the Group with an excellent
performance for the six months to 31st March 2001. Since flotation on the
Alternative Investment Market in December 1997, your Group has returned
increased profits in each of the subsequent reporting periods.
I would like to express my most sincere thanks and appreciation to my
Directors, Presidents, Vice Presidents and Staff at all levels within the
Group, without whom these results would not have been achieved
FINANCIAL RESULTS
For the half-year to 31st March 2001, Group turnover increased by 71% to #
10.24m (2000: #5.98m), with operating profit, after goodwill amortisation of #
148,000, 62% higher at #2.14m (2000 : #1.32m ). Profit before taxation was #
1.99m (2000 : #1.19m) an increase of 67% against the comparative period last
year. These results include the contribution from Neos Technologies Inc. which
was acquired in September 2000. Earnings per share for the period improved by
53% to 6.9p (2000 : 4.5p )
The Group's financial position remains strong despite additional loans
associated with the acquisition of NEOS Technologies Inc. Gearing is at 25%
(2000 : 34%) while interest was covered 11 times ( 2000 : 9 times).
DIVIDENDS
The Directors are declaring an interim dividend of 0.9p to be paid on 27 July
2001 to all shareholders on the register on 22 June 2001. This represents an
increase of 20% when compared to the 0.75p paid last year.
OPERATING PERFORMANCE
United Kingdom
Gooch & Housego
Turnover for the period was up 37% at #3.64m (2000 : #2.65m) while operating
profits, before goodwill amortisation, improved to #1.22m ( 2000 : #0.67m )
As reported in my last Chairman's statement of 14 December 2000 there was
strong growth in our acousto-optic products during 2000 and this trend has
continued throughout the period under review. In particular worldwide demand
for our Q-switches and acousto-optic products continues at record levels.
Our precision optics business also enjoyed a period of growth which was
supported by our supply of optical waveplates for the fibre optics
telecommunications business. The global downturn in demand for these products
has been well documented in the last few months and our supply to these
markets will be adversely affected. However a relatively small proportion of
our total sales is into this sector.
Our total order book continues to increase and now stands in excess of #5m.
This bodes well for our confidence in the future.
Our negotiations to purchase a suitable site for a new factory in the UK are
continuing. Our requirement to remain in an area relatively close to our
existing facility in Ilminster makes this search more difficult. I expect to
be in a position to make an announcement of our detailed plans for the
enlarged facility in the near future.
UNITED STATES
Optronic Laboratories
Optronic Laboratories (OLI) has shown an increase in profits for the first six
months of the financial year. Sales increased from #1.41m to #1.74m while
operating profits increased by 47% from #101,000 to #148,000. The new optics
facility that I referred to in my last statement is totally operational and
contributing to the present success. In addition OLI now supplies both NEOS
and CCI with a range of optical and transducer products previously purchased
from third party suppliers.
There continues to be steady worldwide demand for research-grade scanning
spectroradiometers and this technology is now beginning to migrate into the
commercial and industrial arenas. This is most evident in the Light Emitting
Diode ( LED ) industry, as LEDs are now designed in a whole range of
applications, which require precise measurements. To meet the demands of these
industries, we are launching a lower priced non-scanning high speed
spectroradiometer. We are very excited about this product based on initial
market feedback and have great hopes for its future.
Cleveland Crystals Inc.
The company has experienced a difficult start to the current financial year
with operating profits lower at # 116,000 ( 2000 : # 636,000 ) from sales of #
2.14m ( 2000 : #2.08m ). This has been the result of a temporary postponement
of a contract by a large public sector customer, the National Ignition
Facility (NIF) at the Lawrence Livermore National Laboratory (LLNL) in
California. These contracts are currently being rescheduled but will still not
recover the position before the end of this financial year. LLNL remain
committed to CCI and demonstrated their confidence in the company during this
first six months with further investment of almost $1.5m in additional capital
equipment and production facilities located in our factory in Cleveland. NIF
has recently announced that it has been awarded a further $70m of funding from
June 2001.
The original core business of electro-optics has remained flat during the
period but the new range of crystals shows continued improvement.
Having suffered these problems, CCI has responded with an aggressive sales and
product development campaign targeted at laser OEMs to increase unit volumes.
Progress is being made with firm orders from new OEM customers. Business
prospects in large crystalline optics for inertial confinement fusion lasers
continue to look strong and CCI is a world leader in this market.
NEOS Technologies Inc.
The acquisition of NEOS Technologies Inc (NEOS) was completed on 22 September
2000 and has made a valuable contribution to current profits. Sales for the
six months to 31 March 2001 were #2.94m with operating profits of # 0.8m.
These results represent a significant increase over the same period last year.
Following a full post-acquisition review we are now implementing a
rationalisation programme for the entire NEOS product range. In many areas of
manufacturing and marketing we have identified areas of commonality which will
lead to increased efficiency and reduced costs. An example of this is that,
as a result of investment by NEOS in new equipment, all RF Driver manufacture
for the Group is being transferred to them.
I am delighted with the performance and contribution made by NEOS in these six
months and in particular wish to thank Eddie Young, President, and Bob
Belfatto, Senior Vice President, for their efforts. As agreed at the time of
the acquisition, Eddie will retire at the end of the year, but has agreed to
continue to act as a consultant to the Company.
PROSPECTS
These results have been achieved against a background of difficult trading
conditions with particular concern in the US of a deeper recession. Although
our businesses have not been directly affected, we are fully aware of the
potential impact. Our strategy of acquisitions in different sectors of the
photonics industries with diverse products and new geographical areas, stands
us in good stead for the future.
The second half of the year has started well. Your Board continues to review
each of the Group's businesses and to examine various ways in which we can
provide increased focus on those activities that represent the greatest
opportunities.
Archie Gooch MBE JP
Executive Chairman 11 June 2001
GOOCH & HOUSEGO PLC
UNAUDITED CONSOLIDATED PROFIT AND LOSS ACCOUNT
6 months 6 months 12 months
ended ended ended
31 March 31 March 30 September
2001 2000 2000
(unaudited) (unaudited) (audited)
#'000 #'000 #'000
Turnover 10,240 5,976 12,510
Operating Profit 2,138 1,318 2,815
Net interest payable (153) (130) (226)
Profit on ordinary
activities before taxation 1,985 1,188 2,589
Tax on profit on ordinary (746) (433) (926)
activities
Profit on ordinary
activities after taxation 1,239 755 1,663
Dividends on equity shares (162) (127) (406)
Retained profit for the
financial period 1,077 628 1,257
Earnings per ordinary 6.9p 4.5p 9.8p
share
Dividend per share 0.9p 0.75p 2.3p
CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
#'000 #'000 #'000
Profit for the financial period 1,239 755 1,663
Currency translation
differences on foreign currency 93 94 143
net investments
Taxation on retranslation gains
/losses on foreign currency 44 - 56
loans
hedged against foreign currency
investments
Total recognised gains and
losses for the financial period 1,376 849 1,862
GOOCH & HOUSEGO PLC
UNAUDITED CONSOLIDATED GROUP BALANCE SHEET
AS AT 31 MARCH 2001
As at As at As at
31 March 31 March 30 September
2001 2000 2000
(unaudited) (unaudited) (audited)
FIXED ASSETS
Intangible assets 5,481 3,250 5,629
Tangible assets 3,742 3,598 3,624
9,223 6,848 9,253
CURRENT ASSETS
Stock 3,457 1,602 3,225
Debtors 4,134 2,688 3,401
Cash at Bank and in
hand 2,056 1,000 1,930
9,647 5,290 8,556
CREDITORS
Amounts falling due (4,070) (2,781) (3,808)
within one year
NET CURRENT ASSETS 5,577 2,509 4,748
TOTAL ASSETS LESS
CURRENT LIABILITIES 14,800 9,357 14,001
CREDITORS
Amounts falling due (3,562) (2,573) (3,977)
after more than one
year
11,238 6,784 10,024
CAPITAL AND RESERVES
Called up share capital 3,600 3,381 3,600
Share premium 3,404 1,113 3,404
Revaluation reserve 308 308 308
Profit and loss account 3,926 1,982 2,712
11,238 6,784 10,024
GOOCH & HOUSEGO PLC
UNAUDITED CONSOLIDATED CASH FLOW STATEMENT
For the six months ended 31 March 2001
6 months 6 months 12 months
ended ended ended
31 March 31 March 30 September
2001 2000 2000
(unaudited) (unaudited) (audited)
#'000 #'000 #'000
Cash flow from operating 2,222 2,157 4,142
activities (i)
Returns on investments and
servicing of finance
Interest received 45 14 38
Interest paid (197) (143) (276)
Interest element of hire purchase (1) (1) (2)
contracts
Debt issue costs - - (77)
Net cash outflow from returns on (153) (130) (317)
investments and servicing of finance
UK tax paid (164) (78) (301)
Overseas tax paid (664) (230) (511)
Cash outflow from taxation (828) (308) (812)
Capital expenditure
Purchase of tangible (295) (215) (404)
fixed assets
Net cash outflow from capital (295) (215) (404)
expenditure and financial investment
Acquisitions
Acquisition of subsidiary - NEOS (239) - (4,401)
Technologies Inc
Cash acquired on acquisition - - 388
Net cash outflow from acquisition (239) - (4,013)
Equity dividends paid (279) (220) (347)
Net cash inflow/(ouflow) before 428 1,284 (1,751)
financing
Financing
New bank loans - - 5,103
Repayment of bank loan (248) (421) (3,984)
Hire purchase repayment (20) (34) (13)
Issue of share capital - - 2,628
Net cash (outflow)/inflow (268) (455) 3,734
Increase in cash in the period 160 829 1,983
GOOCH & HOUSEGO PLC
GROUP CONSOLIDATED ACCOUNTS
Notes to the cash flow statement
6 months 6 months 12 months
ended ended ended
31 March 2001 31 March 2000 30 September 2000
(unaudited) (unaudited) (audited)
#'000 #'000 #'000
( i ) Reconciliation of operating profit to operating cash flows
Operating profit 2,138 1,318 2,815
Amortisation of 148 86 173
goodwill & licenses
Amortisation of debt
issue costs 11 - 10
Depreciation 284 231 434
(Increase) in stock (86) (224) (326)
(Increase) / decrease
in debtors (565) 661 262
Increase in creditors 292 85 774
2,222 2,157 4,142
(ii) Reconciliation of net cash inflow / (outflow) to movement in
net debt
Increase in cash in year 160 829 1,983
Cash outflow / (inflow)
from decrease/(increase)
in debt and lease financing 268 455 (1,106)
Changes in net debt resulting
from cash flow 428 1,284 877
New hire purchase contracts - - (25)
Movement in debt issue costs (11) - 67
Translation difference (186) 13 (404)
Movement in net debt
in the period 231 1,297 515
Net debt at 1 October 2000 (3,067) (3,582) (3,582)
Net debt at 31 March 2001 (2,836) (2,285) (3,067)
(iii) Analysis of net debt
At 1 Cash Exchange Non-cash At 31 March
October flow Movement 2001
2000
#'000 #'000 #'000 #'000 #'000
Cash in hand and at bank 1,930 160 (34) - 2,056
Debt due after one year (3,942) - (109) 517 (3,534)
Debt due within one year (977) 248 (40) (528) (1,297)
Hire purchase (78) 20 (3) - (61)
(3,067) 428 (186) (11) (2,836)
NOTES TO THE INTERIM STATEMENT
1. The financial information set out above does not constitute statutory
accounts within the meaning of Section 240 of the Companies Act 1985. The
summarised results for the six months ended 31 March 2001 and the
comparative figures for the six months ended 31 March 200 are unaudited.
The figures for the year ended 30 Septemer 2000 have been extracted from
the Group statutory accounts, which have been filed with the Registrar of
Companies and contain an unqualified audit report.
2. Taxation for the six months ended 31 March 2001 and 31 March 2000 has
been estimated at prevailing rates. Taxation for the year ended 30
September 2000 is the actual provision for that year.
3. Earnings per share for the six months to 31 March 2001 have been
calculated using a total of 17,999,162 (2000 total of 16,904,162) shares,
being the average number of shares in issued throughout that period. For
the 12 months to 30 September 2000 the weighted average number of shares
in issue was 16,934,080.
4. All of the amounts above are in respect of continuing operations.
5. Accounting policies are consistent with those applied in previous years
and are as set out in the Group's audited accounts at 30 September 2000.
6. The interim dividend will be paid on 27 July 2001 to shareholders on the
register at close of business on 22 June 2001.
7. Copies of the Interim Statement will be desptached to Shareholders during
the week commencing 18 June 2001 and are available from the Company
Secretary, Gooch & Housego PLC, The Old Magistrates Court, Ilminster,
Somerset TA19 0AB.
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