RNS Number:8210S
London Securities PLC
20 October 2000
CHAIRMAN'S STATEMENT
As I explained in the Chairman's Statement included with the 1999 Annual
Report, the Company acquired Ansul s.a. on 29 December 1999 and disposed of
all its property subsidiaries at the same date.
With effect from 29 December 1999, the Group's primary business is the
manufacture, sale and service of portable fire equipment in the UK, Belgium,
Holland, Austria and Switzerland. Consequently, the comparative figures
included in the profit and loss account are not relevant to our present
activities as they relate to the group's former activities as a property
investment group.
An unaudited proforma profit and loss account setting out financial
information for our new business was included in the 1999 Annual Report and a
comparison thereto is detailed below:
Unaudited Unaudited
6 months to 30 proforma 12
June 2000 months to 31
December 1999
#'000 #'000
EBITDA 4551 7092
Add back non-recurring costs - 1244
______ ______
Adjusted EBITDA 4551 8336
Depreciation (848) (1506)
Amortisation of goodwill (1319) (1005)
______ ______
Operating profit 2384 5825
Despite the continuing weakening of the Euro (60% of profits arise from
activities in Euro denominated countries), adjusted EBITDA has improved from
1999.
Basic earnings per ordinary share are 4.9p and adjusted earnings per share in
which amortisation of goodwill is added back are 13.9p for the six-month
period.
It was always forecast that cashflows would be tight in the first year of the
new operations. The weakness of the Euro has had a negative influence on the
sterling denominated cashflows and, as the directors wish to retain a level of
cash to allow greater flexibility, the Board has decided not to propose an
interim dividend in line with previous years.
It is a requirement of the Alternative Investment Market (AIM) that the
ordinary shares of the Company can be traded electronically within the CREST
system. Your board has approved the necessary resolution and it is expected
that the company's shares will become transferable by means of the CREST
system on 20th November, 2000. Further information is provided at the end of
this statement.
Prospects for the second half remain promising with results to date being
broadly in line with those experienced in the first six months.
JG Murray
Chairman
LONDON SECURITIES PLC
Consolidated Profit and Loss Account
Unaudited 6 Unaudited 6 Audited
months to months to year ended
30 June 30 June 31 December
2000 1999 1999
#'000s #'000s #'000s
Turnover 19,046 - -
Gross rents receivable 1,006 2,006
Cost of sales (3,134)
Direct property outgoings - (52) (107)
______ ______ ______
Gross profit/net rents receivable 15,912 954 1,899
Distribution costs (7,842) - -
Administrative expenses (5,686) (64) (113)
______ ______ ______
Operating profit 2,384 890 1,786
EBITDA** 4,551 890 1,786
Depreciation (848) - -
Amortisation of goodwill (1,319) - -
______ ______ ______
Operating profit 2,384 890 1,786
Income from fixed asset investments 95 - -
Profit on sale of property investment - - 1,878
companies
Net interest payable (739) (365) (683)
Exchange gain on foreign currency - - 25
______ ______ ______
Profit on ordinary activities before 1,740 525 3,006
taxation
Taxation (1,021) (148) (376)
______ ______ ______
Profit on ordinary activities after 719 377 2,630
taxation
Dividends - - (102)
______ ______ ______
Retained profit 719 377 2,528
______ ______ ______
Basic earnings per ordinary share 4.9p 7.4p 50.7p
Adjusted earnings per ordinary share 13.9p 7.4p 14.2p
(note 2)
Dividend per ordinary share Nil Nil 2.0p
All of the above results for 1999, excluding the exchange gain on foreign
currency, arose from discontinued operations.
** Earnings Before Interest, Taxation, Depreciation and Amortisation
LONDON SECURITIES PLC
Consolidated Balance Sheet
Unaudited Unaudited Audited
as at as at as at 31
30 June 30 June December
2000 1999 1999
#'000s #'000s #'000s
Fixed assets
Intangible assets 51,427 - 52,568
Tangible assets 6,016 19,595 5,843
Investments 70 - 70
______ ______ ______
57,513 19,595 58,481
______ ______ ______
Current assets
Stocks 2,851 - 2,421
Debtors 8,414 225 7,622
Cash at bank and in hand 3,236 2,510 3,633
______ ______ ______
14,501 2,735 13,676
______ ______ ______
Creditors: due within one year
Finance debt (3,235) (10,075) (3,169)
Other creditors (10,349) (1,206) (10,781)
______ ______ ______
(13,584) (11,281) (13,950)
______ _______ ______
Net current assets/(liabilities) 917 (8,546) (274)
______ ______ ______
Total assets less current liabilities 58,430 11,049 58,207
______ ______ ______
Creditors: due after more than one year
Finance debt (18,244) - (19,007)
Other creditors (356) - (40)
Provisions for liabilities & charges (1,442) - (1,481)
______ ______ ______
(20,042) 0 (20,528)
______ ______ ______
Net assets 38,388 11,049 37,679
______ ______ ______
Capital and reserves
Called up share capital 1,457 512 1,459
Share premium 27,476 3,925 27,476
Capital redemption reserve 107 103 105
Revaluation reserve 8 1,985 -
Merger reserve 2,033 2,033 2,033
Profit and loss account 7,307 2,491 6,606
______ ______ ______
Total equity shareholders' funds 38,388 11,049 37,679
______ ______ ______
LONDON SECURITIES PLC
Consolidated Cashflow Statement
Unaudited Unaudited Audited
6 months 6 months year ended
to 30 June to 30 June 31
2000 1999 December
#'000s #'000s 1999
#'000s
Net cash inflow from operating activities 3,118 802 1,291
______ ______ ______
Return on investments and servicing of
finance
Interest received 46 56 115
Interest paid (785) (417) (798)
Dividends received 95
______ ______ ______
Net cash outflow from return on (644) (361) (683)
investments and servicing of finance
______ ______ ______
Taxation
Corporation tax paid (451) - (405)
______ ______ ______
Capital expenditure
Payments to acquire tangible fixed assets (1,022) - -
Receipts from sales of tangible fixed 197 - -
assets
______ ______ ______
Net cash outflow for capital expenditure (825) 0 0
______ ______ ______
Acquisitions and disposals
Payments to acquire subsidiary (273) - (23,910)
undertakings
Net cash acquired with the purchase of 17 - 3,391
subsidiary undertakings
Receipts from sale of subsidiary - - 11,013
undertakings
Net cash transferred with the sale of - - (112)
subsidiary undertakings
______ ______ ______
Net cash outflow for acquisitions and (256) 0 (9,618)
disposals
______ ______ ______
Equity dividends paid to shareholders 0 (102) (102)
______ ______ ______
Net cash inflow/(outflow) before use of 942 339 (9,517)
liquid resources and financing
______ ______ ______
Management of liquid resources
Decrease in short term deposits with banks 0 - 1,759
______ ______ ______
Financing
Purchase of own shares (62) - (21)
New long term loans 181 - 11,000
Repayment of long term loans (1,458) - -
______ ______ ______
Net cash (outflow)/inflow from financing (1,339) 0 10,979
______ ______ ______
(Decrease)/increase in cash and (397) 339 3,221
equivalents
______ ______ ______
NOTES
1. NATURE OF INFORMATION
The financial information contained in this interim statement does not
constitute statutory accounts within the meaning of section 240 of the
Companies Act 1985. The financial information for the six months ended 30
June 2000 is unaudited and has been prepared on the basis of the accounting
policies set out in the Group's 1999 Report and Accounts. Statutory accounts
for the period ended 31 December 1999 have been delivered to the Registrar of
Companies. The report of the auditors on those accounts was unqualified and
did not contain a statement under sections 237(2) or 237(3) of the Companies
Act 1985.
2. EARNINGS PER SHARE
The calculation of basic earnings per ordinary share is based on the profit on
ordinary activities after taxation of #719,000 (1999: #377,000) and on
14,591,162 (1999: 5,120,495) ordinary shares, being the weighted average
number of ordinary shares in issue during the period.
The calculation of adjusted earnings per ordinary share based on the above
weighted average and on adjusted earnings which comprise:
Six months Six months Year ended
to 30 June to 30 June 31 December
2000 1999 1999
#'000 #'000
Profit on ordinary activities after 719 377 2,630
taxation
Eliminate effect of:
Profit on disposal of property - - (1,878)
investment companies
Exchange gain on foreign currency loan - - (25)
Amortisation of goodwill 1,319 - -
______ ______ ______
Adjusted earnings 2,038 377 727
______ ______ ______
3. ACQUISITIONS
During the year the group acquired the entire share capital of Al Protec s.a.
and Gremplmayr GmbH at a cost of #273,000. The principal activity of both
companies is the provision of fire protection equipment and maintenance
services. The acquisitions have been accounted for using the acquisition
method of accounting.
The net assets acquired were as follows:
Book and
fair value
#'000
Net assets required:
Fixed assets 25
Stocks 33
Debtors 157
Cash at bank 17
Creditors (137)
______
Net assets required 95
Goodwill arising on acquisition 178
______
273
______
Purchase price
Satisfied by:
Bank loan 181
Cash 92
______
Paid to vendors 273
______
The companies contributed #13,000 to the group's retained profit for the
period.
4. TAXATION
The taxation charge for the period (59%) appears high due to the non-
deductibility for taxation purposes of the amortisation of goodwill.
5. RESERVES
Capital Revaluation Merger Profit
Redemption Reserve Reserve and Loss
Reserve Account
#'000 #'000 #'000 #'000
As at 1 January 2000 105 2,033 6,606
Arising on revaluation of fixed - 8 - -
assets
Purchase of own shares 2 - - (63)
Profit for the period - - - 719
Currency movement - - - 45
______ ______ ______ ______
As at 30 June 2000 107 8 2,033 7,307
_____ ______ ______ ______
Copies of this statement are being sent to all shareholders and are available
to the public from the company's registered office at Wistons Lane, Elland,
West Yorkshire, HX5 9DS.
PARTICIPATION IN CREST
NOTICE TO SHAREHOLDERS
Shareholders should note that, in accordance with the Uncertificated
Securities Regulations 1995 ("the Regulations"), on 13 September 2000,
the Company resolved by a resolution of its directors that title to the
ordinary shares of 10 pence each in the capital of the Company, in issue or to
be issued, may be transferred by means of a relevant system. The resolution
of the directors became effective immediately.
The above paragraph contains the notice that the Company is obliged to give to
its members, under the Regulations, of the passing of a "directors'
resolution" (as defined in the Regulations) in relation to its ordinary shares
to join CREST in due course. The shares have not become transferable by means
of the CREST system merely by virtue of the passing of the directors'
resolution; the permission of the Operator of the system, CRESTCo Limited,
must also be given before the shares can become so transferable. It is
anticipated that this will take place on 20 November 2000.
The effect of the directors' resolution is to disapply, in relation to the
ordinary shares, those provisions of the Company's articles of association
that are inconsistent with the holding and transfer of those shares in CREST
and any provision of the Regulations, as and when the shares concerned enter
the CREST system.
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