TIDMHDT
RNS Number : 2808X
Holders Technology PLC
26 August 2022
Holders Technology plc
("Holders Technology", the "Company" or the "Group")
Half Year Report
Holders Technology, (AIM: HDT), is pleased to announce its
unaudited half year results for the six months ended 31 May
2022.
Highlights
Holders Technology operates as a lighting and wireless control
solutions ("LCS") provider and supplies specialty laminates and
materials for printed circuit board ("PCB") manufacturers.
Unaudited results for the half year ended 31 May 2022 are
summarised as follows:
2022 2021
GBP'000 GBP'000
------- -------
Revenue LCS 2,227 1,991
PCB 1,227 3,798
Total 3,454 5,789
-------
Gross profit 1,207 1,718
Margins 34.9% 29.7%
Overheads 1,450 1,616
Operating (loss)/ profit (243) 102
Finance expense (1) (10)
Income from joint ventures 18 12
(Loss)/ profit before tax (226) 104
Taxation - -
(Loss)/ profit after tax (226) 104
======= =======
(Loss)/ earnings per share (5.35p) 2.46p
Interim dividend per share 0.50p 0.50p
Net assets per share 99p 95p
---------------------------- ------ ------- -------
Chairman's statement
Half year ended 31 May 2022
The Group has undergone a transformation during the last two
financial years. In 2021, the Group disposed of its lower growth,
lower margin PCB consumable activities. During 2022 the Group has
refocused on its continuing specialist PCB businesses and invested
further in the LCS divisions. Details of this are set out
below.
Revenue for the 6 months to 31 May 2022 was GBP3,454,000.
Revenue for the 6 months to 31 May 2021 ("H1 2021") from the
continuing business (i.e. excluding discontinued PCB revenues) was
GBP3,373,000, and therefore growth from the continuing revenues was
3.3%. This figure however does not include the Group share of joint
venture revenues of GBP193,000 (2021: 48,000); if this is included
then Group revenue growth was 7.5%.
Gross margins increased from 29.7% to 34.9%, and the pre-tax
Group result was a loss of GBP226,000 (H1 2021: profit of
GBP104,000).
LCS
UK revenue growth was strong however market demand in Germany
was weakened by project delays and cancellations. LCS revenue
increased by 11.9% overall to GBP2,227,000 (2021: GBP1,991,000) and
by 18.7%, when including the Group share of the joint venture
revenue. We have continued to invest across the Group in staff,
technology and product development. These costs have initially
contributed to a margin decrease from 37.7% to 34.3%, which we are
seeking to improve. The overall result for the LCS divisions was an
operating loss of GBP216,000 (H1 2021: profit of GBP53,000).
In addition to the above, the four LCS joint ventures, Holders
Technology Austria, Holders Technology Data Analytics, Holders
Technology New Zealand and Holders Technology Australia made
further progress during the period and overall were profitable.
PCB
Results from the restructured PCB divisions were broadly in line
with expectations, in spite of difficult market conditions.
Revenues from the continuing product ranges decreased by 11.2% from
GBP1,382,000 to GBP1,227,000, partly because shorter supplier lead
times enabled customers to hold less stock. Gross margins improved
from 25.5% to 36.1%, due to the product mix of the retained PCB
business and the overall result was an operating profit of
GBP83,000 (H1 2021: GBP134,000 profit).
Cash and Debt
Group cash at the period end was GBP2,490,000 (31 May 2021:
GBP1,277,000). Other than lease liabilities, the Company has no
debt.
Outlook
The second half of the financial year has started well, with
improving revenue and profitability. We will continue with our
strategy to invest in sales and technical resources, new products
and technology to enable the Group to be a leader in our markets.
Whilst we are cautious regarding the global economic outlook, we
remain confident that future performance will demonstrate the
validity of this approach.
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) 596/2014.
Rudolf W. Weinreich Holders Technology plc
Executive Chairman 27-28 Eastcastle Street
London W1W 8HD
For further information, contact:
Holders Technology plc
Rudi Weinreich, Executive Chairman 01896 758781
Victoria Blaisdell, Group Managing Director
Paul Geraghty, Group Finance Director
SP Angel Corporate Finance LLP - Nomad and Broker
Matthew Johnson/ Caroline Rowe, Corporate Finance
020 3470 0470
Website
www.holdersgroup.com
Consolidated income statement
for the half year ended 31 May 2022 (Unaudited)
Half year Half year Full year
ended ended 31 ended 30
31 May 2021 Nov 2021
May 2022
========== ========== ==========
Notes GBP'000 GBP'000 GBP'000
Revenue 3 3,454 5,789 12,386
Cost of sales (2,247) (4,071) (8,516)
========== ========== ==========
Gross profit 1,207 1,718 3,870
Distribution costs (88) (213) (408)
Administrative expenses (1,359) (1,399) (3,001)
Impairment of goodwill - - (146)
Other operating expenses (3) (4) 8
========== ========== ==========
Operating (loss)/ profit (243) 102 323
Income from joint ventures 18 12 3
Profit on disposal of assets - - 471
Finance costs (1) (10) (10)
========== ========== ==========
(Loss)/ profit before taxation (226) 104 787
Taxation 4 - - (92)
========== ========== ==========
(Loss)/ profit for the period (226) 104 695
========== ========== ==========
Total and continuing
Basic (loss)/ earnings per
share 6 (5.35p) 2.46p 16.45p
========== ========== ==========
Diluted (loss)/ earnings per
share 6 (5.35p) 2.46p 16.45p
========== ========== ==========
Consolidated statement of comprehensive income
for the half year ended 31 May 2022 (Unaudited)
Half year Half year Full year
ended ended 31 ended 30
31 May 2021 Nov 2021
May 2022
========== ================ ==========
GBP'000 GBP'000 GBP'000
Profit/ (loss) for the period (226) 104 695
Exchange differences on
translation of foreign operations 7 (89) (134)
========== ================ ==========
Total comprehensive income
for the period (219) 15 561
========== ================ ==========
Consolidated statement of changes in equity
for the half year ended 31 May 2022 (Unaudited)
Capital
Share redemption Translation Retained
Share capital premium reserve reserve earnings Total equity
============== ============ ================== ================ ================ =============
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance 1 Dec
2020 422 1,590 1 248 1,738 3,999
Dividends - - - - (32) (32)
Transactions
with owners - - - - (32) (32)
============== ============ ================== ================ ================ =============
Profit for the
year - - - - 695 695
Exchange
differences on
translating
foreign
operations - - - (134) - (134)
============== ============ ================== ================ ================ =============
Total
comprehensive
income for the
year - - - (134) 695 561
============== ============ ================== ================ ================ =============
Balance 30 Nov
2021 422 1,590 1 114 2,401 4,528
============== ============ ================== ================ ================ =============
Dividends - - - - (106) (106)
- - - - (106) (106)
Loss for the
period - - - - (226) (226)
Exchange
differences on
translating
foreign
operations - - - 7 - 7
============== ============ ================== ================ ================ =============
Total
comprehensive
income for the
period - - - 7 (226) (219)
============== ============ ================== ================ ================ =============
Balance 31 May
2022 422 1,590 1 121 2,069 4,203
============== ============ ================== ================ ================ =============
Consolidated balance sheet
at 31 May 2022 (Unaudited)
Half year Half year Full year
ended ended 31 ended 30
31 May 2021 Nov 2021
May 2022
========== ========== ==========
Notes GBP'000 GBP'000 GBP'000
Assets
Non-current assets
Intangible fixed assets 172 378 220
Property, plant and equipment 186 1,127 82
Leased assets 87
Investment in joint ventures 130 40 111
Deferred tax assets 12 12 12
========== ========== ==========
500 1,557 512
========== ========== ==========
Current assets
Inventories 1,623 1,953 1,180
Trade and other receivables 1,173 1,642 1,593
Cash and cash equivalents 2,490 1,277 3,192
========== ========== ==========
5,286 4,872 5,695
Liabilities
Current liabilities
Trade and other payables (1,389) (1,270) (1,661)
Lease liabilities 3 - (930) (58)
Current tax liabilities - - -
========== ========== ==========
(1,389) (2,200) (1,719)
Net current assets 3,897 2,672 4,246
========== ========== ==========
Non-current liabilities
Retirement benefit liability (185) (216) (186)
Lease liabilities - - (35)
Deferred tax liabilities (9) (9) (9)
(194) (225) (230)
Net assets 4,203 4,004 4,528
========== ========== ==========
Shareholders' equity
Share capital 422 422 422
Share premium account 1,590 1,590 1,590
Capital redemption reserve 1 1 1
Retained earnings 2,069 1,829 2,401
Cumulative translation
adjustment 121 162 114
========== ========== ==========
Equity attributable to
the shareholders of the
parent 4,203 4,004 4,528
Consolidated cash flow statement
for the half year ended 31 May 2022 (Unaudited)
Half year Half year Full year
ended ended 31 ended 30
31 May 2021 Nov 2021
May 2022
========== ========== ==========
GBP'000 GBP'000 GBP'000
Cash flows from operating activities
(Loss)/ profit before tax (244) 104 787
Depreciation 43 131 168
Gain on disposal of property,
plant and equipment - - (471)
Impairment - Goodwill - - 146
(Increase)/ decrease in inventories (442) 323 1,093
(Increase)/ decrease in trade
and other receivables (83) (579) (527)
Increase/ (decrease) in trade
and other payables 233 350 702
Interest expense 1 10 10
Cash generated from operations (492) 339 1,908
Income from investments (18) (12) (3)
Tax paid - - (92)
Interest paid (1) (10) (10)
Net cash generated from operations (511) 317 1,803
========== ========== ==========
Cash flows from investing activities
Purchase of property, plant, and
equipment (69) (30) (65)
Investment in joint venture 18 - (80)
Proceeds from sale of property,
plant and equipment - - 553
Net cash used in investing activities (51) (30) 408
========== ========== ==========
Cash flows from financing activities
Equity dividends paid (106) - (32)
Lease repayments (26) (95) (37)
Net cash used in financing activities (132) (95) (69)
========== ========== ==========
Net change in cash and cash equivalents (694) 192 2,142
Cash and cash equivalents at start
of period 3,192 1,113 1,113
Effect of foreign exchange rates (8) (28) (63)
Cash and cash equivalents at end
of period 2,490 1,277 3,192
========== ========== ==========
Notes
1. General information
Holders Technology plc is incorporated in the United Kingdom
under the Companies Act 2006. The principal activity of the group
is to provide specialised materials, components and solutions to
the electronics and lighting industries.
2. Basis of preparation
The condensed consolidated half year financial statements have
been prepared in accordance with the AIM Rules for Companies and
prepared on a basis consistent with International Financial
Reporting Standards ("IFRS") as adopted by the EU and the
accounting policies set out in the Group's financial statements for
the year ended 30 November 2021.
The half year financial statements are unaudited and include all
adjustments which management considers necessary for a fair
presentation of the Group's financial position, operating results
and cash flows for the 6-month periods ended 31 May 2021 and 31 May
2022.
The half year financial statements do not constitute statutory
accounts as defined by Section 434 of the Companies Act 2006. A
copy of the Group's financial statements for the year ended 30
November 2021 prepared in accordance with IFRS as adopted by the EU
has been filed with the Registrar of Companies. The auditors'
report on those financial statements was not qualified and did not
contain statements under s498(2) of s498(3) of the Companies Act
2006.
As permitted, the Group has chosen not to adopt IAS 34 'Interim
Financial Statements' in preparing these half year financial
statements and therefore the half year financial information is not
in full compliance with IFRS.
The preparation of half year financial statements requires
management to make judgements, estimates and assumptions that
affect the application of policies and reported amounts of assets
and liabilities, income, and expenses. Actual results may differ
from these estimates.
These half year financial statements have been prepared under
the historical cost convention.
The board of Holders Technology plc approved this half yearly
report on 25 August 2022.
Notes (continued):
3. Segmental information
Management currently identifies two operating segments:
1. LCS provides lighting and control solutions.
2. PCB distributes materials, equipment, and supplies to the PCB industry.
Analysis by operating segment for the half year ended 31 May
LCS PCB Central Costs Total
2022 2021 2022 2021 2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
======== ======== ======== ======== ======== ======== ======== ========
Revenue 2,227 1,991 1,227 3,798 - - 3,454 5,789
Cost of
sales 1,463 1,241 784 2,830 - - 2,247 4,071
======== ======== ======== ======== ======== ======== ======== ========
Gross Profit 764 750 443 968 - - 1,207 1,718
Distribution
costs 65 54 23 159 - - 88 213
Administration
costs and
other operating
expenses 915 643 338 675 109 85 1,253 1,403
======== ======== ======== ======== ======== ======== ======== ========
Operating
Profit/
(Loss) (216) 53 82 134 (109) (85) (243) 102
======== ======== ======== ======== ======== ======== ======== ========
4. The tax provision for the six months ended 31 May 2022 is
calculated based on the tax rates applicable in the country in
which each company operates.
5. A special dividend of 2.00p per share on the total issued
share capital of 4,224,164 10p ordinary shares was approved by the
board on 21 December 2021 and paid on 28 January 2022.
A final dividend of 0.50p (2021: 0.25p per share) per share on
the total issued share capital of 4,224,164 10p ordinary shares was
approved by the board on 28 January 2022, and paid on 31 May 2022,
in respect of the year ended 30 November 2021.
An interim dividend payment of 0.50p per share (2021: 0.25p per
share) will be payable on 4 October 2022 to shareholders on the
register on 9 September 2022. The shares will go ex-dividend on 8
September 2022. The interim dividend had not been approved by the
board on 31 May 2022 and accordingly, has not been included as a
liability as at that date.
6. The basic earnings per share for continuing operations are
based on the loss for the period of GBP226,000 (2021: profit
GBP104,000) and on 4,224,164 ordinary shares (2021: 4,224,164), the
weighted average number of shares in issue during the period. There
were no share options in issue in 2021 or 2022 and therefore
diluted earnings per share and basic earnings per share are the
same value for each year.
7. A copy of this half yearly report will be sent to
shareholders and is available for inspection at the company's
offices at Holders Technology (UK) Ltd., Units 1-4, Block 9,
Tweedbank Industrial Estate, Galashiels TD1 3RS and via its website
www.holderstechnology.com .
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