TIDMKLR
RNS Number : 1295Y
Keller Group PLC
27 February 2012
For immediate release Monday, 27 February 2012
Keller Group plc
Full Year Results for the year ended 31 December 2011
Keller Group plc ("Keller" or "the Group"), the international
ground engineering specialist, is pleased to announce its full year
results for the year ended 31 December 2011.
Results summary:
-------------------------------- ------------ ------------
2011 2010
-------------------------------- ------------ ------------
Revenue GBP1,154.3m GBP1,068.9m
-------------------------------- ------------ ------------
EBITDA GBP71.4m GBP85.0m
-------------------------------- ------------ ------------
Operating profit* GBP28.9m GBP43.3m
-------------------------------- ------------ ------------
Profit before tax* GBP21.9m GBP39.6m
-------------------------------- ------------ ------------
Earnings per share* 24.8p 44.0p
-------------------------------- ------------ ------------
Cash generated from operations GBP54.8m GBP70.3m
-------------------------------- ------------ ------------
Total dividend per share 22.8p 22.8p
-------------------------------- ------------ ------------
* 2010 figures stated before a GBP21.8m goodwill impairment
charge
Highlights include:
-- 2011 results in line with previous guidance, in a challenging year
-- Year-end net debt better than expected at GBP102.5m (1.4x EBITDA)
-- Recent major project awards, including:
-- GBP120m Wheatstone contract awarded in Australia, starting late 2012
-- GBP30m Vale contract awarded in Malaysia, starting March 2012
-- All-time high order book up 40% on last year
-- up 10% excluding 2013/14 work
-- Business improvement initiatives in progress
Justin Atkinson, Keller Chief Executive said:
"These results reflect tough market conditions which remained
very challenging throughout 2011, with the uncertain macro-economic
outlook impeding any significant recovery in our mature
construction markets - principally the US and Western Europe - and
overcapacity maintaining pressure on margins.
"Overall, whilst the business is expected to show steady
improvement in 2012, the year will not be without further
challenges, particularly given the economic uncertainty and a slow
start to the year in Europe.
"However, with signs of strengthening demand in certain of our
key markets, an increased number of larger projects in the order
book and with the benefits of our Group-wide business improvement
initiatives starting to come through, we are confident that 2012
will be a year of progress."
For further information, please contact:
Keller Group plc www.keller.co.uk
Justin Atkinson, Chief Executive 020 7616 7575
James Hind, Finance Director
Finsbury
James Leviton, Rowley Hudson 020 7251 3801
A presentation for analysts will be held at 9.30am at The London
Stock Exchange,
10 Paternoster Square, London, EC4M 7LS
A live audio webcast will be available from 9.30 am and, on
demand, from 2.00 pm at
http://www.keller.co.uk/keller/investor/result-centre/latest-results/
Print resolution images are available for the media to download
from www.vismedia.co.uk
Notes to Editors:
Keller is the world's largest independent ground engineering
specialist, providing technically advanced and cost-effective
foundation solutions to the construction industry. With 2011
revenue of nearly GBP1.2 billion, Keller has around 6,000 staff
world-wide.
Keller is the market leader in the North America and Australia;
it has prime positions in most established European markets; and a
strong and growing profile in many developing markets.
Chairman's Statement
Results[1]
Group revenue increased by 8% to GBP1,154.3m (2010: GBP1,068.9m)
and the operating profit was GBP28.9m (2010: GBP43.3m), resulting
in an operating margin of 2.5%, compared with the previous year's
4.1%. Profit before tax was GBP21.9m (2010: GBP39.6m) and earnings
per share were 24.8p (2010: 44.0p).
These results reflect tough market conditions which remained
very challenging throughout 2011, with the uncertain macro-economic
outlook impeding any significant recovery in our mature
construction markets - principally the US and Western Europe - and
overcapacity maintaining pressure on margins.
Against this backdrop, the Group has continued to take steps to
reduce its fixed cost base. Actions taken in 2011 will deliver a
further GBP5m of savings in 2012, bringing the total fixed overhead
reduction in North America and Western Europe since 2009 to over
GBP20m, a reduction of around 20%. Going forward, we will continue
to keep costs under close scrutiny.
Cash flow and net debt[2]
The Group continues to focus hard on maximising cash flow in
these difficult times. Cash generated from operations was GBP54.8m
(2010: GBP70.3m), which represented 77% of EBITDA (2010: 83%).
Whilst emphasising cash generation, we continue to make
investments where they are necessary to develop the business and to
secure future growth, which in 2011 included strategic capital
expenditure for Asia and Australia. After net capital expenditure
of GBP37.4m (2010: GBP28.6m), net debt at the end of the year stood
at GBP102.5m (2010: GBP94.0m), which represents 1.4x EBITDA.
The financial position of the Group remains strong. There is
comfortable headroom in the Group's main financing facilities,
which run to 2015, and we continue to operate well within all of
our financial covenants.
Dividends
The Board has recommended a final dividend of 15.2p per share
(2010: 15.2p per share), to be paid on 31 May 2012 to shareholders
on the register at 4 May 2012. Together with the interim dividend
paid of 7.6p, this brings the total dividend for the year to 22.8p
(2010: 22.8p). This unchanged dividend reflects the Board's
confidence in the Group's prospects. Dividend cover for the full
year is 1.1x (2010: 1.9x).
Strategy
During the year we undertook a review of the Group's business
and strategy, facilitated by an independent third party and
involving many of the Group's senior managers. This process, which
was undertaken over a period of six months culminating in the
fourth quarter, reaffirmed our overall strategy: to extend further
our global leadership in specialist ground engineering through both
organic growth and targeted acquisitions.
The review also highlighted certain areas where a concerted
programme of initiatives, together with some internal changes,
could deliver significant improvements to the Group's business and
profitability. This programme focuses principally on: increasing
our revenue and profit from large projects; further improvement of
the Group's risk management; and accelerating our global transfer
of technologies. The review also reinforced local or regional
initiatives which were already in progress and on which we are
redoubling our efforts.
To help maximise the benefits of Keller's global reach and
technical capability, Dr Wolfgang Sondermann (formerly Managing
Director, CEMEA) has been appointed to the new role of Director,
Group Technology & Best Practice. A large part of this new role
will be to drive the Group-wide initiatives to improve further our
risk management and transfer of technology.
Employees
2011 was another challenging year for many of our employees; and
yet, from my visits to our operations around the Group I have seen
first-hand their continued resolve and pride in the business,
together with a willingness to explore new ways of working together
more effectively. I would like to thank them for their contribution
and wish all of them personal success in 2012.
Board
In May 2011, Mr Richard Scholes stepped down as a Non-executive
Director, having served for more than nine years on the Board. Mr
Chris Girling joined the Board in February and took over as Audit
Committee Chairman in May. His considerable experience of the
construction sector and strategic strengths make him an excellent
addition to the Keller Board. In August, Mr David Savage was
appointed to the Board, bringing strong entrepreneurial skills and
a track record in building contracting businesses in Asia and the
Middle East.
Outlook
After a period of stabilisation in 2011, certain recent data
indicate that US construction markets may be turning the corner.
However, the European debt crisis continues to weigh heavily and is
expected to impede recovery in construction markets across Europe.
Looking to Australia and our other developing markets, recent major
contract awards indicate that our businesses in these regions will
have a busy year.
For the Group as a whole, contract awards in recent months have
been strong and, as a result, at the end of January 2012 our order
book was at an all-time high level and 40% ahead of the previous
year. This includes the GBP120m Wheatstone contract announced in
January, most of which will be undertaken in 2013. Excluding work
to be undertaken in 2013/14, the Group order book at the end of
January was 10% ahead of the previous year.
Overall, whilst the business is expected to show steady
improvement in 2012, the year will not be without further
challenges, particularly given the economic uncertainty and a slow
start to the year in Europe. However, with signs of strengthening
demand in certain of our key markets, an increased number of larger
contracts in the order book and with the benefits of our group-wide
business improvement initiatives starting to come through, we are
confident that 2012 will be a year of progress.
Operating Review
Conditions in our major markets
In 2011, many of our major global construction markets saw
further decline and the debt crisis in Europe had a damaging effect
on financial markets around the world. Generally, across our mature
markets, investment in public infrastructure continued to reduce,
as government austerity programmes gained traction. Continued
weakness in privately-financed construction meant that the private
sector was unable to take up the slack.
Although conditions in the US construction market overall
remained difficult, there were signs that the market had
stabilised. Overall, US construction expenditure reduced in the
year by a further 2%. This compares with a fall of 10% in the
corresponding period last year, indicating that, although
expenditure continues to fall, the rate of reduction has slowed
significantly. Private non-residential construction expenditure was
up by 2% year-on-year[3] following two years of significant
reduction, whereas residential construction was reasonably steady,
picking up towards the end of the year. For the second consecutive
year, however, US public infrastructure spending declined, with a
6% year-on-year reduction.
Within our principal European markets, Poland and Germany saw
growth across most sectors. However, France continued to stagnate;
the UK - particularly the housing and commercial sectors of the
market - declined; and Spain contracted still further.
Elsewhere, in Australia the "two-speed" construction market
continued to mirror the underlying economy, offering strong
prospects for projects related to the resources sector, but weaker
demand across the other sectors in the underlying market. Our Asian
markets remained strong, but we saw little change in our Middle
Eastern markets.
Changes to the Group's reporting structure
From January 2012, we have changed the reporting structure of
the Group, with the UK business joining Europe, Middle East and
Africa to form a new EMEA division and the Asian business forming a
separate division. The resultant four reporting divisions of North
America, EMEA, Asia and Australia are better aligned geographically
and represent more closely the expected future revenue and profit
contributions to the Group. The four divisional heads now sit on a
new Group Executive Committee.
This Operating Review has been structured to reflect our new
reporting structure; however, segmental analyses on both the new
and old bases are shown in note 3 to the financial statements.
Operations
North America
Results summary: *
-------------------- ---------- ----------
2011 2010
-------------------- ---------- ----------
Revenue GBP471.1m GBP425.2m
-------------------- ---------- ----------
Operating profit GBP12.0m GBP6.9m
-------------------- ---------- ----------
Operating margin 2.5% 1.6%
-------------------- ---------- ----------
*2010 results are stated before goodwill impairment
Despite the further contraction in US construction markets, our
total revenue from North America was up by 14% in local currency.
However, the trading environment remains extremely competitive,
keeping margins under pressure. At 2.5%, the operating margin was
up on the previous year's 1.6%, but well below the long-term
average for our North American operations.
The full-year operating profit of GBP12.0m (2010: GBP6.9m)
reflects an improving trend as the year progressed, with the
second-half result up significantly on the same period in 2010. A
large part of this improvement was at Suncoast, which continued to
reduce its losses in the second half of the year.
Hayward Baker
Hayward Baker fared best amongst our North American companies,
reflecting the fact that, as a national player with the potential
to work across 50 states, it is less susceptible to regional
differences in market conditions.
Management is continuing to adapt Hayward Baker's operations to
the challenging trading environment, following a change of company
President in early 2011. Hayward Baker's under-performing western
region was subsequently put under the management of Anderson,
before the two were formally merged at the start of 2012. In the
particularly tough market conditions that persist in the Western
States, this should make the two businesses more competitive
through a lower cost base and better utilisation of people and
equipment. The integration is progressing well and will start to
deliver tangible benefits as the year progresses.
One of Hayward Baker's longest-running contracts last year was
in Southern California, where it undertook extensive soil mixing
and jet grouting works for settlement control, liquefaction
mitigation and slope stabilisation, in preparation for the
construction of five new fuel storage tanks.[4] The involvement of
Anderson, who provided pre-drilling services in advance of the
soil-mixing, contributed to a successful outcome and illustrates
the synergies between these two businesses.
North American Piling Companies
The North American piling companies had mixed fortunes, with
certain regions served by Anderson and Case suffering from their
exposure to the particularly difficult California and Florida
markets. HJ Foundation, which has made significant strides over
recent years in winning work outside of its South Florida home
market, continued to demonstrate its excellent job execution,
working both on its own and in several joint projects with Case and
Hayward Baker.
Two of the main contributors to our second-half result were the
large jobs for the extension to the Vogtle nuclear power plant at
Augusta, in Georgia(4) , where Case provided bored piling ;and the
second phase of CFA piling works at the BP oil refinery at Whiting,
Indiana(4) , executed jointly by Case and HJ Foundation.
We are encouraged by the progress made in McKinney in the second
half of the year. Following actions taken to improve its results
and prospects, including a management change in the southern
region, the results have stabilised. With a good order intake in
recent months, McKinney entered 2012 with a healthy order book,
including several jobs for transmission lines - a growing sector
which we have been targeting.
Since the year end, Case has implemented a new enterprise
resource planning (ERP) system which will be progressively
rolled-out across our other North American foundation companies
throughout 2012. The new ERP system requires the standardisation of
certain procedures and will facilitate further co-operation
between, and optimisation of, our North American foundation
companies.
Suncoast
The US residential market, having stabilised in the first half,
ended 2011 on a fairly upbeat note, with housing starts at a level
not seen since 2010 and a significant strengthening of the
homebuilder housing market index.
As we expected, further cost-reduction measures taken in 2010
helped to produce a much improved 2011 result at Suncoast, which
broke even, after a substantial loss in 2010. Since its peak in
2006, Suncoast has reduced its overheads by more than 50%, in line
with the fall in its revenue. The 2011 improvement in performance
was also helped by price increases introduced in late summer, which
held up well despite competitive pressure.
Europe, Middle East & Africa (EMEA)
Results summary: *
-------------------- ---------- ----------
2011 2010
-------------------- ---------- ----------
Revenue GBP384.8m GBP357.8m
-------------------- ---------- ----------
Operating profit GBP8.4m GBP8.1m
-------------------- ---------- ----------
Operating margin 2.2% 2.3%
-------------------- ---------- ----------
*2010 results are stated before goodwill impairment
In local currency, revenue was up by 8% whilst operating profit
was 4% above the previous year.
Europe
In general, our businesses within the more mature European
markets faced very challenging conditions. The exception was
Germany, where the construction market remained reasonably good
across most sectors. Against this backdrop, our German company
performed well, with a continued focus on productivity improvements
and good contract selection. During the year, it extended its
product offering with the addition of complete excavation pits.
Having developed and acquired specific skills and expertise in this
area, the business secured an excellent reference contract for an
excavation at the German State Opera House in Berlin(4) .
France and Spain both implemented further downsizing, with
management doing an excellent job of maintaining the alignment
between overheads and revenues. Both subsidiaries also looked for
selective opportunities outside of their domestic markets.
Elsewhere, in Italy, one of our smaller European markets, we used
our extensive experience of large-scale tunnel stabilisation
projects on the Rome Metro extension(4) .
The UK business also further reduced its costs, with the closure
of one office and the downsizing of another. Despite these actions,
the business reported a loss, which was exacerbated by the impact
of two legacy contracts. During the year the UK business was
awarded contracts valued at GBP37m for the Victoria Station Upgrade
project and GBP31m for the Crossrail project, which started as
anticipated towards the end of 2011. Another Crossrail contract was
for the largest-ever restricted access piling project awarded in
the UK, at Lord Hill's Bridge(4) . With the first phase of the
contract - installing vertical piles - now complete, the more
challenging second phase, which involves installing minipiles at up
to 38-degree angles, is progressing well.
In Eastern Europe, our Polish subsidiary had a strong year,
benefiting from an extremely buoyant civil engineering sector.
However, the business started to slow somewhat towards the end of
the year, as a number of its large projects drew to a close.
Middle East
The impact of the geopolitical issues in the Middle East and
North Africa, which curbed our first-half profitability in these
regions, continued to be felt through the second half. Whilst our
business in Saudi Arabia fared well, the results for the region
overall were disappointing. Since the year end, a new Managing
Director has been appointed to manage our businesses in the region,
as part of a planned management succession.
Brazil
Further progress was made in Brazil, where we have now almost
completed a major contract at Porto do Sudeste, installing vibro
stone columns for the foundations of a new iron ore storage
facility(4) . We also undertook a related contract for ground
improvement works for a new railway link, to connect the facility
to the main rail network.
Having created a new market in vibro stone columns, we are now
extending the range of technologies we can offer in Brazil. Last
year we undertook our first off-shore sand compaction job in the
region and in 2012 our range is being further expanded with the
addition of driven piles.
Asia
Results summary:
------------------ --------- ---------
2011 2010
------------------ --------- ---------
Revenue GBP76.7m GBP92.1m
------------------ --------- ---------
Operating profit GBP6.0m GBP11.8m
------------------ --------- ---------
Operating margin 7.8% 12.8%
------------------ --------- ---------
Overall, our key markets in Asia remained strong throughout the
year and our companies there continued to perform well although,
following an exceptional year in 2010, the results were held back
by contract delays in India and a very competitive piling market in
Singapore.
Asean Region
In Singapore, our ground improvement business demonstrated good
project management and innovative solutions which fed through into
strong results. A contract to create foundations for the Cogen
Power Plant(4) , using sand compaction rather than a traditional
piled solution, illustrates well these success factors.
Our Resource Piling business in Singapore struggled, with tight
pricing in this highly competitive market impacting on margins.
However, market activity picked up in the latter part of the year
and accordingly, Resource Piling now has a much stronger order
book.
The Group's emerging business in Vietnam was profitable and
demonstrated high levels of safety, quality and project
management.
In Malaysia, we had another busy year. Since the year end,
Keller Malaysia has secured a circa GBP30m project to build the
foundations for a major iron ore distribution facility in Lumut for
Vale, for whom we have recently performed work in Brazil. Our scope
involves treating an area of 200,000 m(2) with a system of vibro
stone columns and bored piles, based on our re-design. Work is
expected to commence in March and to be completed in the second
quarter of next year.
India
In India, we experienced significant project delays on two large
projects, which are indicative of the difficulties associated with
working in this market. These delays, combined with severe floods
in the third quarter, resulted in lower than expected sales
volume.
Nonetheless, we are encouraged by the significant improvement in
the piling and ground anchor capabilities of our Indian business,
as it consistently achieves good results in this increasing
component of their work.
Although market forecasts for India have been tempered somewhat
to reflect reduced direct foreign investment and high inflation,
our tender rates and the current order book remain good.
Australia
Results summary:
------------------ ---------- ----------
2011 2010
------------------ ---------- ----------
Revenue GBP221.7m GBP193.8m
------------------ ---------- ----------
Operating profit GBP6.7m GBP19.1m
------------------ ---------- ----------
Operating margin 3.0% 9.9%
------------------ ---------- ----------
In Australia, the 'two-speed' construction market is ever more
apparent, mirroring the underlying economy. Prospects for projects
related to the resources sector continue to be very strong, whereas
commercial construction and expenditure on infrastructure remain
much weaker.
The end of the infrastructure boom in Queensland meant that 2011
was a challenging year for Piling Contractors, our Brisbane-based
business which is largely reliant on the infrastructure market.
This was compounded by some difficult jobs as well as by costs
incurred in connection with possible work in New Zealand. As a
result, Piling Contractors made a loss in the year. Actions were
taken both to refocus the business and management and to reduce its
cost base by A$4m (GBP2.6m), with an associated one-off cost of
about A$2m (GBP1.3m). Encouragingly, Piling Contractors' results
have since improved, as the benefits of the actions taken are now
showing through in their results.
Our other Australian businesses all performed well, with notable
contract successes including minefill works for the new Hunter
Expressway(4) undertaken jointly by KGE and Piling Contractors and
the second stage of ground improvement works for Newcastle Coal
Infrastructure Group's latest Newcastle coal terminal(4) ,
undertaken by KGE. In addition, Vibro-Pile performed well on a
number of smaller contracts in the Melbourne area.
Following its successful completion of remedial works at
Milson's Point wharf, Waterway Constructions was recently awarded a
further Sydney wharf upgrade programme. This is in addition to an
A$86m (GBP57m) design and construct contract for a materials
offloading facility at a liquid natural gas project, being
undertaken as a 50:50 joint venture with a local civil construction
company, which got underway at the start of 2012. Together, these
major contracts mean that Waterway Constructions is well placed for
2012.
Since the year end, Keller Australia has secured a project worth
in excess of A$180m (GBP120m) to install the foundations for the
Wheatstone LNG Plant to be located at Onslow, Western Australia.
The scope of work includes the procurement, installation and
testing of approximately 20,000 piles for the onshore main plant
facilities. Undertaking a project of this scale will require the
collective resources of the Group's Australian businesses, which
have a strong track record of successful collaboration on large and
complex projects. Preparatory work is now underway, with full
production beginning in late 2012 and running through to
mid-2014.
Financial review
Income Statement
Trading results
The Group's total revenue in 2011 was GBP1,154.3m, an increase
of 8% on 2010. Stripping out the effects of acquisitions and
foreign exchange movements, 2011 revenue was 7% up on 2010, almost
wholly due to a 13% increase in like-for-like revenue in North
America.
EBITDA was GBP71.4m, compared to GBP85.0m in 2010 and operating
profit was GBP28.9m, down from GBP43.3m in 2010. The Group
operating margin fell from 4.1% to 2.5%, largely as a result of the
depressed state of the Group's more established markets.
In North America, which represented 41% of Group revenue, the US
dollar-denominated operating profit was up over 80% year-on-year,
albeit from a low base. This was largely due to a substantial
improvement in the result at Suncoast, which broke even in 2011
after recording a significant loss in 2010, although there was also
an increase in the profit earned by the Group's North American
foundation contracting businesses. EMEA's result was similar to the
previous year, while the Asian and Australian results were behind
2010. The Asian result was impacted by a keenly competitive piling
market in Singapore and significant project delays in India. In
Australia, an expected reduction in profitability as a result of
there being fewer large projects in the year was exacerbated by a
very disappointing result at Piling Contractors, which recorded a
loss for the year. Actions taken in the second half of 2011 have
now restored Piling Contractors to profitability.
The Group's trading results are discussed more fully in the
Chairman's Statement and the Operating Review.
Net finance costs
Net finance costs increased to GBP7.0m in 2011 from GBP3.7m in
2010. This increase mainly reflects the increased cost of borrowing
under the Group's GBP170m revolving credit facility agreed in
December 2010 and higher non-cash items required to be included in
net finance costs under IFRS.
Tax
The Group's underlying effective tax rate was 25%, down from 28%
in 2010, as a higher proportion of the Group's profit was derived
from lower tax countries.
Earnings and dividends
Earnings per share (EPS) before goodwill impairment decreased to
24.8p (2010: 44.0p). The Board has recommended a final dividend of
15.2p per share, which brings the total dividend to be paid out of
2011 profits to 22.8p, the same as last year. The 2011 dividend is
covered 1.1 times by earnings.
Cash flow
The Group has always placed a high priority on cash generation.
The current economic environment is inevitably putting pressure on
working capital in certain locations and we continue to focus on
maximising cash generation and minimising the Group's investment in
working capital.
Net cash inflow from operations was GBP54.8m, representing 77%
of EBITDA. Year-end working capital was GBP119.8m, GBP13.1m or 12%
more than at the end of 2010. Stripping out the impact of currency
movements, year-end working capital increased by 8%, consistent
with the 8% increase in revenue. Capital expenditure, net of
disposals, was GBP37.4m, which compares to depreciation of
GBP41.0m.
Financing
As at 31 December 2011, net debt amounted to GBP102.5m (2010:
GBP94.0m). Based on net assets of GBP326.8m, year-end gearing was
31%, up slightly from 28% at the beginning of the year.
The Group's term debt and committed facilities mainly comprise a
US$70.0m private placement, repayable in October 2014, and a
GBP170.0m syndicated revolving credit facility expiring in April
2015. At the year end, the Group also had other committed and
uncommitted borrowing facilities totalling GBP92.6m. The Group
therefore has sufficient available financing to support its
long-term strategy of growth, both through organic means and
targeted, bolt-on acquisitions.
The most significant covenants in respect of our main borrowing
facilities relate to the ratio of net debt to EBITDA, EBITDA
interest cover and the Group's net worth. The Group is operating
well within its covenant limits, as is illustrated in the table
below:
Test Covenant limit Current position*
Net debt: EBITDA < 3x 1.8x
EBITDA interest cover > 4x 15x
Net worth > GBP200m GBP326.8m
----------------------- ---------------- ------------------
*Calculated in accordance with the covenant, with letters of
credit included as net debt and certain adjustments to net
interest
Capital structure
The Group's capital structure is kept under constant review,
taking account of the need for, availability and cost of various
sources of finance.
Pensions
The Group has defined benefit pension arrangements in the UK,
Germany and Austria. The Group closed its UK defined benefit scheme
for future benefit accrual with effect from 31 March 2006 and
existing active members transferred to a new defined contribution
arrangement. The last actuarial valuation of the UK scheme was as
at 5 April 2008, when the market value of the scheme's assets was
GBP26.9m and the scheme was 77% funded on an ongoing basis. The
level of contributions, currently set at GBP1.5m a year, will be
reviewed at the finalisation of the next actuarial valuation, which
is as at April 2011. This valuation is largely complete and, based
on work to date, there are not expected to be any material changes
to either the absolute deficit or the level of contributions going
forward.
The 2011 year-end IAS 19 valuation of the UK scheme showed
assets of GBP32.2m, liabilities of GBP38.0m and a pre-tax deficit
of GBP5.8m.
In Germany and Austria, the defined benefit arrangements only
apply to certain employees who joined the Group prior to 1998.
There are no segregated funds to cover these defined benefit
obligations and the respective liabilities are included on the
Group balance sheet. These totalled GBP11.9m at 31 December 2011.
All other pension arrangements in the Group are of a defined
contribution nature.
Management of financial risks
Currency risk
The Group faces currency risk principally on its net assets,
most of which are in currencies other than sterling. The Group aims
to reduce the impact that retranslation of these assets might have
on the balance sheet by matching the currency of its borrowings,
where possible, with the currency of its assets. The majority of
the Group's borrowings are held in US dollars, euros and Australian
dollars, in order to provide a hedge against these currency net
assets.
The Group manages its currency flows to minimise currency
transaction exchange risk. Forward contracts and other derivative
financial instruments are used to hedge significant individual
transactions. The majority of such currency flows within the Group
relate to repatriation of profits and intra-Group loan repayments.
The Group's foreign exchange cover is executed primarily in the
UK.
The Group does not trade in financial instruments, nor does it
engage in speculative derivative transactions.
Interest rate risk
Interest rate risk is managed by mixing fixed and floating rate
borrowings depending upon the purpose and term of the financing. As
at 31 December 2011, virtually all the Group's third-party
borrowings bore interest at floating rates.
Credit risk
The Group's principal financial assets are trade and other
receivables, bank and cash balances and a limited number of
investments and derivatives held to hedge certain of the Group's
liabilities. These represent the Group's maximum exposure to credit
risk in relation to financial assets.
The Group has stringent procedures to manage counterparty risk
and the assessment of customer credit risk is embedded in the
contract tendering processes. Customer credit risk is mitigated by
the Group's relatively small average contract size, its diversity,
both geographically and in terms of end markets, and by taking out
credit insurance in many of the countries in which the Group
operates. No individual customer represented more than 5% of
revenue in 2011.
The counterparty risk on bank and cash balances is managed by
limiting the aggregate amount of exposure to any one institution by
reference to their credit rating and by regular reviews of these
ratings.
Consolidated income statement
For the year ended 31 December 2011
2011 2010 2010 2010
Before
goodwill Goodwill
Note impairment impairment Total
GBPm GBPm GBPm GBPm
------------------------------------ ------ ---------- ------------ ------------ ----------
Revenue 3 1,154.3 1,068.9 - 1,068.9
Operating costs (1,125.4) (1,025.6) (21.8) (1,047.4)
------------------------------------ ------ ---------- ------------ ------------ ----------
Operating profit 3 28.9 43.3 (21.8) 21.5
Finance income 2.1 3.3 - 3.3
Finance costs (9.1) (7.0) - (7.0)
------------------------------------ ------ ---------- ------------ ------------ ----------
Profit before taxation 21.9 39.6 (21.8) 17.8
Taxation (5.5) (11.0) 4.7 (6.3)
------------------------------------ ----------
Profit for the period 16.4 28.6 (17.1) 11.5
------------------------------------ ------ ---------- ------------ ------------ ----------
Attributable to:
Equity holders of the parent 15.9 28.3 (17.1) 11.2
Minority interests 0.5 0.3 - 0.3
------------------------------------ ------ ---------- ------------ ------------ ----------
16.4 28.6 (17.1) 11.5
------------------------------------ ------ ---------- ------------ ------------ ----------
Earnings per share before goodwill
impairment
Basic earnings per share 5 24.8p 44.0p
Diluted earnings per share 5 24.4p 43.2p
Earnings per share
Basic earnings per share 5 24.8p 17.3p
Diluted earnings per share 5 24.4p 17.0p
Consolidated statement of comprehensive income
For the year ended 31 December 2011
2011 2010 2010 2010
Before
goodwill Goodwill
Note impairment impairment Total
GBPm GBPm GBPm GBPm
--------------------------------------------- ------- ------ ------------ ------------ -------
Profit for the period 16.4 28.6 (17.1) 11.5
------------------------------------------------------ ------ ------------ ------------ -------
Other comprehensive income
Exchange differences on translation
of foreign operations (6.3) 12.0 - 12.0
Net investment hedge gains/(losses) 0.3 (0.3) - (0.3)
Cash flow hedge losses taken to equity - (3.0) - (3.0)
Cash flow hedge transfers to income
statement - 3.0 - 3.0
Actuarial gains/(losses) on defined
benefit pension schemes 1.1 (1.3) - (1.3)
Tax on actuarial (gains)/losses on
defined benefit pension schemes (0.3) 0.3 - 0.3
------------------------------------------------------ ------ ------------ ------------ -------
Other comprehensive income for the
period, net of tax (5.2) 10.7 - 10.7
------------------------------------------------------ ------ ------------ ------------ -------
Total comprehensive income for the
period 11.2 39.3 (17.1) 22.2
------------------------------------------------------ ------ ------------ ------------ -------
Attributable to:
Equity holders of the parent 10.9 39.3 (17.1) 22.2
Minority interests 0.3 - - -
--------------------------------------------- ------- ------ ------------ ------------ -------
11.2 39.3 (17.1) 22.2
----------------------------------------------------- ------ ------------ ------------ -------
Consolidated balance sheet
As at 31 December 2011
2011 2010
Note GBPm GBPm
------------------------------------------ ----- -------- --------
Assets
Non-current assets
Intangible assets 100.6 106.8
Property, plant and equipment 266.1 275.0
Deferred tax assets 6.7 10.0
Other assets 15.8 16.1
------------------------------------------ ----- -------- --------
389.2 407.9
------------------------------------------ ----- -------- --------
Current assets
Inventories 37.3 32.9
Trade and other receivables 334.7 334.6
Current tax assets 10.5 6.2
Cash and cash equivalents 50.0 41.4
------------------------------------------ ----- -------- --------
432.5 415.1
------------------------------------------ ----- -------- --------
Total assets 3 821.7 823.0
------------------------------------------ ----- -------- --------
Liabilities
Current liabilities
Loans and borrowings (8.4) (25.9)
Current tax liabilities (6.8) (7.1)
Trade and other payables (252.2) (260.8)
Provisions (9.7) (9.1)
------------------------------------------ ----- -------- --------
(277.1) (302.9)
------------------------------------------ ----- -------- --------
Non-current liabilities
Loans and borrowings (144.1) (109.5)
Retirement benefit liabilities (17.7) (20.1)
Deferred tax liabilities (22.5) (18.4)
Provisions (4.0) (4.5)
Other liabilities (29.5) (36.8)
------------------------------------------ ----- -------- --------
(217.8) (189.3)
------------------------------------------ ----- -------- --------
Total liabilities 3 (494.9) (492.2)
------------------------------------------ ----- -------- --------
Net Assets 326.8 330.8
------------------------------------------ ----- -------- --------
Equity
Share capital 6.6 6.6
Share premium account 38.1 38.0
Capital redemption reserve 7.6 7.6
Translation reserve 42.6 48.4
Retained earnings 222.7 220.1
------------------------------------------ ----- -------- --------
Equity attributable to equity holders of
the parent 317.6 320.7
Minority interests 9.2 10.1
------------------------------------------ ----- -------- --------
Total equity 326.8 330.8
------------------------------------------ ----- -------- --------
Consolidated statement of changes in equity
For the year ended 31 December 2011
Share Share Capital Translation Hedging Retained Attributable Minority Total
capital premium redemption reserve reserve earnings to interests equity
account reserve equity
holders
of
parent
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
--------------- -------- -------- ----------- ------------ -------- --------- ------------- ---------- -------
At 1 January
2010 6.6 38.0 7.6 36.4 - 224.1 312.7 10.6 323.3
Profit for the
period - - - - - 11.2 11.2 0.3 11.5
--------------- -------- -------- ----------- ------------ -------- --------- ------------- ---------- -------
Other
comprehensive
income
Exchange
differences
on
translation
of foreign
operations - - - 12.3 - - 12.3 (0.3) 12.0
Net investment
hedge
losses - - - (0.3) - - (0.3) - (0.3)
Cash flow
hedge losses
taken to
equity - - - - (3.0) - (3.0) - (3.0)
Cash flow
hedge
transfers
to income
statement - - - - 3.0 - 3.0 - 3.0
Actuarial
losses on
defined
benefit
pension
schemes - - - - - (1.3) (1.3) - (1.3)
Tax on
actuarial
losses
on defined
benefit
pension
schemes - - - - - 0.3 0.3 - 0.3
--------------- -------- -------- ----------- ------------ -------- --------- ------------- ---------- -------
Other
comprehensive
income for
the period,
net of tax - - - 12.0 - (1.0) 11.0 (0.3) 10.7
--------------- -------- -------- ----------- ------------ -------- --------- ------------- ---------- -------
Total
comprehensive
income for
the period - - - 12.0 - 10.2 22.2 - 22.2
Dividends - - - - - (14.2) (14.2) (0.7) (14.9)
Share capital
issued - - - - - - - 0.2 0.2
At 31 December
2010
and 1 January
2011 6.6 38.0 7.6 48.4 - 220.1 320.7 10.1 330.8
--------------- -------- -------- ----------- ------------ -------- --------- ------------- ---------- -------
Profit for the
period - - - - - 15.9 15.9 0.5 16.4
--------------- -------- -------- ----------- ------------ -------- --------- ------------- ---------- -------
Other
comprehensive
income
Exchange
differences
on
translation
of foreign
operations - - - (6.1) - - (6.1) (0.2) (6.3)
Net investment
hedge
gains - - - 0.3 - - 0.3 - 0.3
Actuarial
gains on
defined
benefit
pension
schemes - - - - - 1.1 1.1 - 1.1
Tax on
actuarial
gains
on defined
benefit
pension
schemes - - - - - (0.3) (0.3) - (0.3)
--------------- -------- -------- ----------- ------------ -------- --------- ------------- ---------- -------
Other
comprehensive
income for
the period,
net of tax - - - (5.8) - 0.8 (5.0) (0.2) (5.2)
--------------- -------- -------- ----------- ------------ -------- --------- ------------- ---------- -------
Total
comprehensive
income for
the period - - - (5.8) - 16.7 10.9 0.3 11.2
Dividends - - - - - (14.7) (14.7) (1.1) (15.8)
Share-based
payments - - - - - 0.6 0.6 - 0.6
Share capital
issued - 0.1 - - - - 0.1 - 0.1
Acquisition of
minority
interest - - - - - - - (0.1) (0.1)
At 31 December
2011 6.6 38.1 7.6 42.6 - 222.7 317.6 9.2 326.8
--------------- -------- -------- ----------- ------------ -------- --------- ------------- ---------- -------
Consolidated cash flow statement
For the year ended 31 December 2011
2011 2010
GBPm GBPm
----------------------------------------------------- ------- -------
Cash flows from operating activities
Operating profit 28.9 21.5
Goodwill impairment - 21.8
----------------------------------------------------- ------- -------
Operating profit before goodwill impairment 28.9 43.3
Depreciation of property, plant and equipment 41.0 40.0
Amortisation of intangible assets 1.5 1.7
Profit on sale of property, plant and equipment (0.3) (0.5)
Other non-cash movements 3.2 5.8
Foreign exchange losses - 0.2
----------------------------------------------------- ------- -------
Operating cash flows before movements in working
capital 74.3 90.5
(Increase)/decrease in inventories (5.0) 5.2
Increase in trade and other receivables (5.2) (23.8)
(Decrease)/increase in trade and other payables (5.1) 2.2
Change in provisions, retirement benefit and
other non-current liabilities (4.2) (3.8)
----------------------------------------------------- ------- -------
Cash generated from operations 54.8 70.3
Interest paid (5.7) (4.5)
Income tax paid (3.8) (10.2)
----------------------------------------------------- ------- -------
Net cash inflow from operating activities 45.3 55.6
----------------------------------------------------- ------- -------
Cash flows from investing activities
Interest received 0.6 0.5
Proceeds from sale of property, plant and equipment 1.9 1.0
Acquisition of subsidiaries, net of cash acquired (0.2) (23.4)
Acquisition of property, plant and equipment (37.7) (28.2)
Acquisition of intangible assets (1.6) (1.4)
Acquisition of other non-current assets (0.1) (0.3)
----------------------------------------------------- ------- -------
Net cash outflow from investing activities (37.1) (51.8)
----------------------------------------------------- ------- -------
Cash flows from financing activities
Proceeds from the issue of share capital 0.1 0.2
New borrowings 54.1 99.5
Repayment of borrowings (40.3) (76.8)
Payment of finance lease liabilities (0.7) (1.3)
Dividends paid (15.8) (14.9)
----------------------------------------------------- ------- -------
Net cash (outflow)/inflow from financing activities (2.6) 6.7
----------------------------------------------------- ------- -------
Net increase in cash and cash equivalents 5.6 10.5
Cash and cash equivalents at beginning of period 39.1 29.3
Effect of exchange rate fluctuations (1.4) (0.7)
----------------------------------------------------- ------- -------
Cash and cash equivalents at end of period 43.3 39.1
----------------------------------------------------- ------- -------
1. Basis of preparation
The Group's 2011 results have been prepared in accordance with
International Financial Reporting Standards ('IFRS') as adopted by
the EU.
The financial information set out above does not constitute the
Company's statutory accounts for the years ended 31 December 2011
or 2010 but is derived from the 2011 accounts. Statutory accounts
for 2010 have been delivered to the Registrar of Companies. Those
for 2011, prepared under IFRS as adopted by the EU, will be
delivered to the Registrar of Companies and made available on the
Company's website at www.keller.co.uk in April 2012. The auditors
have reported on those accounts; their reports were (i)
unqualified, (ii) did not include references to any matters to
which the auditors drew attention by way of emphasis without
qualifying their reports and (iii) did not contain statements under
section 498(2) or (3) of the Companies Act 2006.
2. Foreign currencies
The exchange rates used in respect of principal currencies
are:
Average for Period end
period
------------------- -------------- -------------
2011 2010 2011 2010
------------------- ------ ------ ------ -----
US dollar 1.60 1.55 1.55 1.55
Euro 1.15 1.17 1.19 1.17
Australian dollar 1.55 1.68 1.52 1.52
------------------- ------ ------ ------ -----
3. Segmental analysis
The Group is managed as four geographical divisions and has only
one major product or service: specialist ground engineering
services. This is reflected in the Group's management structure and
in the segment information reviewed by the Chief Operating Decision
Maker.
2010
2011 2011 Operating 2010
profit
before 2010 Operating
Operating 2010 goodwill Goodwill profit
Revenue profit Revenue impairment impairment Total
GBPm GBPm GBPm GBPm GBPm GBPm
-------------------------------- --------- ----------- --------- ------------ ------------ -----------
UK 53.6 (3.7) 49.6 (2.5) - (2.5)
North America 471.1 12.0 425.2 6.9 (13.5) (6.6)
CEMEA(1) 407.9 18.1 400.3 22.4 (8.3) 14.1
Australia 221.7 6.7 193.8 19.1 - 19.1
-------------------------------- --------- ----------- --------- ------------ ------------ -----------
1,154.3 33.1 1,068.9 45.9 (21.8) 24.1
Central items and eliminations - (4.2) - (2.6) - (2.6)
-------------------------------- --------- ----------- --------- ------------ ------------ -----------
1,154.3 28.9 1,068.9 43.3 (21.8) 21.5
-------------------------------- --------- ----------- --------- ------------ ------------ -----------
2011
2011 2011 2011 2011 2011 Tangible
Segment Segment Capital Capital Depreciation and intangible
assets liabilities employed additions and amortisation assets
GBPm GBPm GBPm GBPm GBPm GBPm
----------------------------- --------- ------------- ---------- ----------- ------------------ ----------------
UK 39.2 (16.2) 23.0 2.3 1.7 22.2
North America 306.0 (101.5) 204.5 8.9 12.5 133.7
CEMEA(1) 280.4 (111.1) 169.3 18.5 19.9 139.4
Australia 124.5 (41.0) 83.5 9.9 8.2 71.1
----------------------------- --------- ------------- ---------- ----------- ------------------ ----------------
750.1 (269.8) 480.3 39.6 42.3 366.4
Central items and
eliminations(2) 71.6 (225.1) (153.5) (0.3) 0.2 0.3
----------------------------- --------- ------------- ---------- ----------- ------------------ ----------------
821.7 (494.9) 326.8 39.3 42.5 366.7
----------------------------- --------- ------------- ---------- ----------- ------------------ ----------------
2010
2010 2010 2010 2010 2010 Tangible
Segment Segment Capital Capital Depreciation and intangible
assets liabilities employed additions and amortisation assets
GBPm GBPm GBPm GBPm GBPm GBPm
----------------------------- --------- ------------- ---------- ----------- ------------------ ----------------
UK 37.0 (14.1) 22.9 0.3 1.9 21.8
North America 291.8 (98.2) 193.6 6.0 13.1 137.9
CEMEA(1) 309.1 (130.7) 178.4 15.9 20.1 151.6
Australia 122.3 (45.2) 77.1 24.5 6.6 70.0
----------------------------- --------- ------------- ---------- ----------- ------------------ ----------------
760.2 (288.2) 472.0 46.7 41.7 381.3
Central items and
eliminations(2) 62.8 (204.0) (141.2) 0.3 - 0.5
----------------------------- --------- ------------- ---------- ----------- ------------------ ----------------
823.0 (492.2) 330.8 47.0 41.7 381.8
----------------------------- --------- ------------- ---------- ----------- ------------------ ----------------
(1 Continental Europe, Middle East and Asia.)
(2 Central items includes net debt and tax balances.)
The impact of acquisitions is detailed in note 4.
The Group changed its divisional management structure with
effect from 1 January 2012. This has resulted in identifying a new
reportable segment, Asia. This was previously reported within the
CEMEA segment. In addition the UK segment has been merged with the
CEMEA segment, which has now been renamed as Europe, Middle East
and Africa ('EMEA'). Although this change is effective 1 January
2012, additional disclosures have been set out in these Financial
Statements below which reflect this structure, with the comparative
information being restated.
2011 2011 2010 2010 2010 2010
Restated Restated Restated Restated
Operating
profit
before Operating
Operating goodwill Goodwill profit
Revenue profit Revenue impairment impairment Total
GBPm GBPm GBPm GBPm GBPm GBPm
-------------------------------- --------- ----------- ---------- ------------ ------------ -----------
North America 471.1 12.0 425.2 6.9 (13.5) (6.6)
EMEA (3) 384.8 8.4 357.8 8.1 (8.3) (0.2)
Asia 76.7 6.0 92.1 11.8 - 11.8
Australia 221.7 6.7 193.8 19.1 - 19.1
-------------------------------- --------- ----------- ---------- ------------ ------------ -----------
1,154.3 33.1 1,068.9 45.9 (21.8) 24.1
Central items and eliminations - (4.2) - (2.6) - (2.6)
-------------------------------- --------- ----------- ---------- ------------ ------------ -----------
1,154.3 28.9 1,068.9 43.3 (21.8) 21.5
-------------------------------- --------- ----------- ---------- ------------ ------------ -----------
2011
2011 2011 2011 2011 2011 Tangible
Segment Segment Capital Capital Depreciation and intangible
assets liabilities employed additions and amortisation assets
GBPm GBPm GBPm GBPm GBPm GBPm
----------------------------- --------- ------------- ---------- ----------- ------------------ ----------------
North America 306.0 (101.5) 204.5 8.9 12.5 133.7
EMEA (3) 252.9 (113.3) 139.6 13.6 17.3 122.0
Asia 66.7 (14.0) 52.7 7.2 4.3 39.6
Australia 124.5 (41.0) 83.5 9.9 8.2 71.1
----------------------------- --------- ------------- ---------- ----------- ------------------ ----------------
750.1 (269.8) 480.3 39.6 42.3 366.4
Central items and
eliminations
(4) 71.6 (225.1) (153.5) (0.3) 0.2 0.3
----------------------------- --------- ------------- ---------- ----------- ------------------ ----------------
821.7 (494.9) 326.8 39.3 42.5 366.7
----------------------------- --------- ------------- ---------- ----------- ------------------ ----------------
2010 2010 2010 2010 2010
Restated Restated Restated Restated 2010 Restated
Restated Tangible
Segment Segment Capital Capital Depreciation and intangible
assets liabilities employed additions and amortisation assets
GBPm GBPm GBPm GBPm GBPm GBPm
---------------------------- ---------- ------------- ---------- ----------- ------------------ ----------------
North America 291.8 (98.2) 193.6 6.0 13.1 137.9
EMEA (3) 264.0 (118.4) 145.6 10.0 16.8 128.1
Asia 82.1 (26.4) 55.7 6.2 5.2 45.3
Australia 122.3 (45.2) 77.1 24.5 6.6 70.0
---------------------------- ---------- ------------- ---------- ----------- ------------------ ----------------
760.2 (288.2) 472.0 46.7 41.7 381.3
Central items and
eliminations
(4) 62.8 (204.0) (141.2) 0.3 - 0.5
---------------------------- ---------- ------------- ---------- ----------- ------------------ ----------------
823.0 (492.2) 330.8 47.0 41.7 381.8
---------------------------- ---------- ------------- ---------- ----------- ------------------ ----------------
(3 Europe, Middle East and Africa.)
(4 Central items includes net debt and tax balances.)
4. Acquisitions
There were no acquisitions in the year. Acquisitions in 2010
were as follows:
Waterway Nilex Total
Fair Fair Fair
Acquisitions in Carrying value Fair Carrying value Fair Carrying value Fair
2010 amount adjustment value amount adjustment value amount adjustment value
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
------------------------- -------- ----------- ------ -------- ----------- ------ -------- ----------- ------
Net assets acquired
Intangible assets - 0.5 0.5 - 0.2 0.2 - 0.7 0.7
Property, plant
and equipment 7.9 2.8 10.7 1.3 - 1.3 9.2 2.8 12.0
Cash and cash
equivalents 9.1 - 9.1 - - - 9.1 - 9.1
Receivables 2.3 - 2.3 3.6 - 3.6 5.9 - 5.9
Other assets 0.5 - 0.5 0.6 - 0.6 1.1 - 1.1
Loans and borrowings (4.8) - (4.8) - - - (4.8) - (4.8)
Other liabilities (4.5) - (4.5) (1.1) - (1.1) (5.6) - (5.6)
------------------------- -------- ----------- ------ -------- ----------- ------ -------- ----------- ------
10.5 3.3 13.8 4.4 0.2 4.6 14.9 3.5 18.4
------------------------- -------- ----------- ------ -------- ----------- ------ -------- ----------- ------
Goodwill 7.9 - 7.9
------------------------- -------- ----------- ------ -------- ----------- ------ -------- ----------- ------
Total consideration 21.7 4.6 26.3
------------------------- -------- ----------- ------ -------- ----------- ------ -------- ----------- ------
Satisfied by:
Initial cash
consideration 21.1 4.6 25.7
Contingent consideration 0.6 - 0.6
------------------------- -------- ----------- ------ -------- ----------- ------ -------- ----------- ------
21.7 4.6 26.3
------------------------- -------- ----------- ------ -------- ----------- ------ -------- ----------- ------
On 10 June 2010 the Group acquired 100% of the share capital of
Waterfront Services Pty Limited, Australia, with subsidiaries,
trading as Waterway Constructions ('Waterway'). The provisional
fair value of the intangible assets acquired represents the fair
value of customer contracts at the date of acquisition. The
goodwill arising on acquisition is attributable to the knowledge
and expertise of the assembled workforce and the operating
synergies that arise from the Group's strengthened market position.
Contingent consideration of up to GBP10.9m (A$16.5m) is payable
based on total earnings before interest and tax in the three
year-period to 30 June 2013. Acquisition costs of GBP0.4m (A$0.7m)
were charged to other operating charges.
On 14 June 2010 the Group acquired selected assets and
businesses of Nilex Construction LLC and other entities
(collectively 'Nilex'), the leading wick drain contractor in the
United States. Contingent consideration of up to GBP0.6m ($1.0m) is
payable based on total earnings before interest and tax in the two
year-period to 30 June 2012.
The fair value of the total receivables in both acquisitions is
not materially different from the gross contractual amounts
receivable and is expected to be recovered in full. In the period
to 31 December 2010 Waterway and Nilex contributed GBP24.1m to
turnover and GBP1.0m to the net profit of the Group. Had both
acquisitions taken place on 1 January 2010, total Group revenue in
2010 would have been GBP1,090.1m and total net profit in 2010 would
have been GBP13.1m.
5. Earnings per share
Basic and diluted earnings per share are calculated as
follows:
2011 2011 2010 2010
Basic Diluted Basic Diluted
GBPm GBPm GBPm GBPm
--------------------------------------------------- ----------- ----------- ----------- -----------
Earnings (after tax and minority interests),
being net profits attributable to equity holders
of the parent 15.9 15.9 11.2 11.2
No. No. No. No.
of shares of shares of shares of shares
Million Million Million Million
Weighted average of ordinary shares in issue
during the year 64.3 64.3 64.2 64.2
Add: weighted average of shares under option
during the year - 1.0 - 1.0
Adjusted weighted average of ordinary shares
in issue 64.3 65.3 64.2 65.2
--------------------------------------------------- ----------- ----------- ----------- -----------
2011 2010
--------------------------------------------------- ------------------------ ------------------------
Pence Pence Pence Pence
--------------------------------------------------- ----------- ----------- ----------- -----------
Earnings per share 24.8p 24.4p 17.3p 17.0p
--------------------------------------------------- ----------- ----------- ----------- -----------
Earnings per share of 24.8p (2010: 17.3p) was calculated based
on earnings of GBP15.9m (2010: GBP11.2m) and the weighted average
number of ordinary shares in issue during the year of 64.3 million
(2010: 64.2 million).
Diluted earnings per share of 24.4p (2010: 17.0p) was calculated
based on earnings of GBP15.9m (2010: GBP11.2m) and the adjusted
weighted average number of ordinary shares in issue during the year
of 65.3 million (2010: 65.2 million).
Earnings per share before goodwill impairment of 24.8p (2010:
44.0p) was calculated based on earnings of GBP15.9m (2010:
GBP28.3m) and the weighted average number of ordinary shares in
issue during the year of 64.3 million (2010: 64.2 million).
Diluted earnings per share before goodwill impairment of 24.4p
(2010: 43.2p) was calculated based on earnings of GBP15.9m (2010:
GBP28.3m) and the adjusted weighted average number of ordinary
shares in issue during the year of 65.3 million (2010: 65.2
million).
6. Dividends payable to equity holders of the parent
Ordinary dividends on equity shares:
2011 2010
GBPm GBPm
---------------------------------------------------------------- ----- -----
Amounts recognised as distributions to equity holders in
the period:
Final dividend for the year ended 31 December 2010 of 15.2p 9.8 -
per share (2009: nil)
Second interim dividend for the year ended 31 December 2009
of 14.5p per share in lieu of a final dividend - 9.3
Interim dividend for the year ended 31 December 2011 of
7.6p (2010: 7.6p) per share 4.9 4.9
14.7 14.2
---------------------------------------------------------------- ----- -----
The Board have recommended a final dividend for the year ended
31 December 2011 of GBP9.8m, representing 15.2p (2010: 15.2p) per
share. The proposed dividend is subject to approval by shareholders
at the AGM on 18 May 2012 and has not been included as a liability
in these financial statements.
7. Capital and reserves
The capital redemption reserve is a non-distributable reserve
created when the Company's shares were redeemed or purchased other
than from the proceeds of a fresh issue of shares.
The total number of shares held in Treasury was 2.2m (2010:
2.2m). All shares issued related to share options exercised.
8. Related party transactions
Transactions between the parent, jointly controlled operations
and its subsidiaries, which are related parties, have been
eliminated on consolidation and are not disclosed in this note.
During the year the Group undertook various contracts with a
total value of GBP2.3m (2010: GBP3.3m) for GTCEISU Construccion,
S.A., a connected person of Mr Lopez Jimenez, a Director of the
Company. An amount of GBP1.8m (2010: GBP2.3m) is included in trade
and other receivables in respect of amounts outstanding as at 31
December 2011.
During the year the Group made purchases from GTCEISU
Construccion, S.A. with a total value of GBP3.5m (2010: GBP3.6m).
An amount of GBP1.0m (2010: GBP2.8m) is included in trade and other
payables in respect of amounts outstanding as at 31 December
2011.
Related party transactions were made on an arms-length basis.
All amounts outstanding from related parties are unsecured and will
be settled in cash. No guarantees have been given or received. No
provisions have been made for doubtful debts in respect of the
amounts owed by related parties.
The remuneration of the Directors, who are the key management
personnel and related parties of the Group, is set out below in
aggregate for each of the relevant categories specified in IAS 24 -
Related Party Disclosures.
2011 2010
GBPm GBPm
------------------------------ ----- -----
Short-term employee benefits 2.1 1.9
Post-employment benefits 0.2 0.2
------------------------------ ----- -----
2.3 2.1
------------------------------ ----- -----
[1] 2010 results are stated before a GBP21.8m goodwill
impairment charge.
[2] Net debt represents total loans and borrowings less cash and
short-term deposits.
[3] The North America Census Bureau of the Department of
Commerce, 1 February 2012.
[4] Case Studies can be found on our website at
http://www.keller.co.uk/services.aspx
This information is provided by RNS
The company news service from the London Stock Exchange
END
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