TIDMNWF
RNS Number : 2612D
NWF Group PLC
30 January 2018
NWF Group plc
30 January 2018
NWF Group plc
NWF Group plc: Half Year results for the period ended 30
November 2017
NWF Group plc ("NWF" or "the Group"), the specialist
agricultural and distribution business delivering feed, food and
fuel across the UK, today announces its half year results for the
period ended 30 November 2017.
Financial highlights H1 2017 H1 2016 %
---------------------- ------------ ------------ ---------
Revenue GBP295.8m GBP255.9m +15.6%
Headline operating
profit* GBP2.4m GBP2.2m +9.1%
Headline profit
before taxation* GBP2.2m GBP2.0m +10.0%
Headline diluted
EPS* 3.6p 3.3p +9.1%
Interim dividend
per share 1.0p 1.0p -
Net debt GBP16.3m GBP19.1m (14.7%)
Net debt to EBITDA 1.2x 1.6x -
Statutory results
Profit before
taxation GBP1.9m GBP1.3m +46.2%
Operating profit GBP2.4m GBP1.8m +33.3%
Diluted EPS 3.1p 2.1p +47.6%
* Headline operating profit excludes exceptional items. Headline
profit before taxation excludes exceptional items and the net
finance cost in respect of the Group's defined benefit pension
scheme. Headline diluted EPS also takes into account the taxation
effect thereon.
Operational highlights:
-- Revenue growth from increased activity levels and higher commodity prices in Feeds and Fuels
-- Delivery of planned profit improvements in Feeds and Fuels
-- New customer wins in Food ensures Wardle will be fully utilised
-- Board's full year expectations for trading performance and net debt levels unchanged
Divisional highlights:
-- Feeds - headline operating profit of GBP0.4 million (H1 2016:
loss of GBP0.3 million). The planned benefits from the investment
at Longtown and Wardle are being delivered with increases in
operational efficiency driving profitability.
-- Food - headline operating profit of GBP0.9 million (H1 2016:
GBP1.6 million). Profit in line with our expectations, reflecting
lower storage volumes. The focus on business development has been
successful with significant new customer wins in the first half
year.
-- Fuels - headline operating profit of GBP1.1 million (H1 2016:
GBP0.9 million). Delivered strong volume growth with commercial
customers to offset the lower levels of market demand for heating
oil over summer/autumn months.
Board appointment:
David Downie appointed to the Board as a non-executive director
with immediate effect.
Richard Whiting, Chief Executive, NWF Group plc, commented:
"NWF has delivered profit improvement in line with our
expectations in the first half year with each of the divisions
performing as planned. The significant increase in profits in Feeds
is of particular note, demonstrating the expected return on the
capital investment completed in 2017. Current trading is in line
with the Board's full year expectations."
A short videocast of the Half Year Results highlights is
available to view here.
For further information please visit www.nwf.co.uk or
contact:
Richard Whiting, Reg Hoare /Andrew Leach Justin Jones /
Chief Executive MHP Communications Mike Bell
Chris Belsham, Tel: 020 3128 8100 Peel Hunt LLP
Finance Director (Nominated Adviser)
NWF Group plc Tel: 020 7418 8900
Tel: 01829 260
260
CHAIRMAN'S STATEMENT
NWF has continued its development as planned in the first half
year. Feeds has significantly increased its profitability as a
consequence of last year's investment in Longtown and Wardle and
more stable commodity prices. Food had spare capacity as
anticipated, however we are pleased to report new customer wins,
particularly Arla UHT, which will ensure the Wardle facility is
fully utilised. Fuels has continued to grow with increasing volumes
across the depot network in commercial fuels.
Net debt at the period end was lower at GBP16.3 million (H1
2016: GBP19.1 million), reflecting profit improvement and further
reductions in working capital, particularly in Feeds, with net debt
to EBITDA at 1.2x (H1 2016: 1.6x). The Group's banking facilities
of GBP65.0 million are committed to October 2019 and NWF continues
to operate with substantial headroom.
Results
Revenue for the half year ended 30 November 2017 was 15.6%
higher at GBP295.8 million (H1 2016: GBP255.9 million) as a result
of increased activity in Feeds and Fuels and higher commodity
prices. Headline operating profit was higher at GBP2.4 million (H1
2016: GBP2.2 million), with the increases in Feeds and Fuels more
than offsetting the reduction in Food. Headline profit before
taxation(1) was GBP2.2 million (H1 2016: GBP2.0 million).
Headline basic earnings per share(1) was 3.6p (H1 2016: 3.3p)
and headline diluted earnings per share(1) was 3.6p (H1 2016:
3.3p).
Net cash absorbed by operations for the period amounted to
GBP0.6 million (H1 2016: net cash absorbed of GBP2.3 million).
Whilst the normal seasonal trading pattern results in a cash
outflow in the first half, a continued focus on working capital
management has reduced the level of cash absorbed.
Net capital expenditure in the period was GBP1.6 million (H1
2016: GBP6.1 million). This reflects normal replacement capex as
planned, compared to last year when significant capital investments
were made.
Net assets at 30 November 2017 increased to GBP39.6 million (30
November 2016: GBP34.5 million) largely due to the decrease in the
accounting valuation of the pension scheme deficit. The IAS 19R
valuation has decreased from GBP21.9 million to GBP19.0 million
primarily as a result of a reduction in the discount rate from
3.05% to 2.70%.
The triennial valuation at 31 December 2016 has been completed
as planned with the deficit increasing as anticipated from GBP14.1
million to GBP19.1 million. As a consequence the Group has
increased recovery contributions from GBP1.2 million to GBP1.8
million per annum from 1 January 2018.
1 Excluding GBP0.3 million (H1 2016: GBP0.3 million) net finance
cost in respect of the defined benefit pension scheme, and
exceptional restructuring costs of GBPNil (H1 2016: GBP0.4 million)
and, where applicable, the tax effect thereon.
Dividend
The Board has approved an interim dividend per share of 1.0p (H1
2016: 1.0p). This will be paid on 1 May 2018 to shareholders on the
register as at 23 March 2018. The shares will trade ex-dividend on
22 March 2018.
Operations
Feeds
Revenue increased by 19.5% to GBP77.8 million (H1 2016: GBP65.1
million) as a result of higher commodity prices and increased sales
of traded products in the period. Headline operating profit was
GBP0.4 million, compared to a GBP0.3 million loss for the same
period last year, due to our improved operational efficiency.
Volumes were 1.0% lower at 265,000 tonnes (H1 2016: 268,000
tonnes) as the business focused on those customers within an
efficient range from our key operational locations. Market
conditions were good as milk prices increased to more sustainable
levels, which has improved farm incomes and confidence in the dairy
sector. Feed demand increased, particularly from farmers who had
cut feed rates due to a lower milk price in the prior year. Overall
commodity input costs were more stable in the first half in spite
of volatility caused by movements in exchange rates, albeit they
increased towards the period end. Average milk prices at the end of
November were 25.6% higher at 31.9p per litre (November 2016:
25.4p). Our operational platform with the expanded facilities in
Longtown and Wardle delivered the planned efficiencies and provides
an effective base for future development.
Food
Revenue reduced by 3.0% to GBP19.5 million (H1 2016: GBP20.1
million). Headline operating profit was GBP0.9 million (H1 2016:
GBP1.6 million).
As anticipated, storage volumes were lower at 89,000 pallet
spaces (H1 2016: 103,000). The division has focused on business
development to fully utilise the Wardle facility and has secured,
through competitive tenders, over 15,000 pallet spaces including
significant pallet spaces for the storage of Arla UHT requirements.
With other new ambient customers this will ensure continued full
utilisation of the facility. Activity measured in the number of
loads was robust in spite of lower storage volumes and higher
levels of backload work were secured. The Palletline operation
continued its planned development and is being utilised by food and
non-food customers across the region. Service levels were at 99.5%
during the period.
Fuels
Revenue increased by 16.3% to GBP198.5 million (H1 2016:
GBP170.7 million) as a result of increased volumes, higher oil
prices and a greater commercial product mix. Headline operating
profit was GBP1.1 million (H1 2016: GBP0.9 million).
Volumes increased by 7.6% to 269 million litres (H1 2016: 250
million litres) with increased sales of diesel and gas oil in
particular. Commercial growth reflected the benefit of having
additional business development resources committed in several key
depots across the country. Brent Crude has increased during the
first half to an average of $54.11 per barrel (H1 2016: $48.20 per
barrel) and ended the reported period at $63.57 per barrel.
Board appointment
I am pleased to announce the appointment of David Downie to the
Board as non-executive director with immediate effect. David brings
a wealth of operational and commercial skills which are
complementary to the capabilities of the Board. In addition, David
will chair the Remuneration Committee.
Outlook and future prospects
The Group has continued to perform as planned since the period
end. In Feeds, our customers continue to buy feed to optimise their
performance in a higher milk price environment, albeit some limited
milk price reductions have been announced. Price increases have
been implemented to offset recent increased commodity costs and we
are introducing new products to support our nutritional advice on
farm. In Food, the Christmas period has been delivered successfully
and we are focused on the ontake of customers won in the first half
year. In Fuels, the cold weather pre-Christmas supported a solid
December performance as we focus on providing industry leading
service levels to customers across our depot network.
We continue to focus on growth initiatives, both organic and
through targeted acquisitions.
Overall the Group continues to trade in line with the Board's
expectations and I look forward to updating shareholders later this
year.
Philip Acton
Chairman
30 January 2018
Condensed consolidated income statement
for the half year ended 30 November 2017 (unaudited)
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2017 2016 2017
Note GBPm GBPm GBPm
------------------------- ------- ------------- ------------- --------
Revenue 3 295.8 255.9 555.8
Operating expenses (293.4) (254.1) (548.0)
------------------------- ------- ------------- ------------- --------
Headline operating
profit(1) 2.4 2.2 9.0
Exceptional items 4 - (0.4) (1.2)
------------------------- ------- ------------- ------------- --------
Operating profit 3 2.4 1.8 7.8
Finance costs 5 (0.5) (0.5) (1.1)
------------------------- ------- ------------- ------------- --------
Headline profit before
taxation(1) 2.2 2.0 8.5
Net finance cost in
respect of the defined
benefit pension scheme (0.3) (0.3) (0.6)
Exceptional items 4 - (0.4) (1.2)
------------------------- ------- ------------- ------------- --------
Profit before taxation 1.9 1.3 6.7
Income tax expense(2) 6 (0.4) (0.3) (1.2)
------------------------- ------- ------------- ------------- --------
Profit for the period
attributable to equity
shareholders 1.5 1.0 5.5
------------------------- ------- ------------- ------------- --------
Earnings per share
(pence)
Basic 7 3.1 2.1 11.3
Diluted 7 3.1 2.1 11.3
------------------------- ------- ------------- ------------- --------
Headline earnings per
share (pence)(1)
Basic 7 3.6 3.3 14.0
Diluted 7 3.6 3.3 14.0
------------------------- ------- ------------- ------------- --------
1 Headline operating profit is statutory operating profit of
GBP2.4 million (H1 2016: GBP1.8 million) before exceptional items
of GBPNil (H1 2016: GBP0.4 million). Headline profit before
taxation is statutory profit before taxation of GBP1.9 million (H1
2016: GBP1.3 million), after adding back the net finance cost in
respect of the Group's defined benefit pension scheme of GBP0.3
million (H1 2016: GBP0.3 million), and the exceptional items.
Headline earnings per share also takes into account the taxation
effect thereon.
2 Taxation on exceptional items in the current period has
reduced the charge by GBPNil (H1 2016: GBP0.1 million).
Condensed consolidated statement of comprehensive income
for the half year ended 30 November 2017 (unaudited)
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2017 2016 2017
GBPm GBPm GBPm
-------------------------------------- ------------- ------------- --------
Profit for the period attributable
to equity shareholders 1.5 1.0 5.5
Items that will never be
reclassified to profit
or loss:
Re-measurement gain/(loss)
on the defined benefit
pension scheme 0.5 (3.7) (1.8)
Tax on items that will
never be reclassified to
profit or loss - 0.6 0.3
-------------------------------------- ------------- ------------- --------
Total comprehensive income/(expense)
for the period 2.0 (2.1) 4.0
-------------------------------------- ------------- ------------- --------
The notes form an integral part of this condensed consolidated
half year report.
Condensed consolidated balance sheet
as at 30 November 2017 (unaudited)
30 November 30 November 31 May
2017 2016 2017
Note GBPm GBPm GBPm
----------------------------- ----- ------------ ------------ --------
Non-current assets
Property, plant and
equipment 45.8 45.2 46.6
Intangible assets 22.8 23.1 22.8
Deferred income tax
assets 3.2 3.7 3.5
----------------------------- ----- ------------ ------------ --------
71.8 72.0 72.9
----------------------------- ----- ------------ ------------ --------
Current assets
Inventories 4.6 4.7 4.2
Trade and other receivables 68.6 61.8 61.3
Cash and cash equivalents 0.6 0.5 1.0
Derivative financial
instruments 8 0.2 0.2 0.2
----------------------------- ----- ------------ ------------ --------
74.0 67.2 66.7
----------------------------- ----- ------------ ------------ --------
Total assets 145.8 139.2 139.6
----------------------------- ----- ------------ ------------ --------
Current liabilities
Trade and other payables (65.2) (57.4) (62.2)
Current income tax
liabilities (0.6) (0.4) (0.6)
Borrowings 8 (0.1) (0.1) (0.1)
Contingent deferred
consideration (0.9) - (0.5)
Derivative financial 8 - - -
instruments
----------------------------- ----- ------------ ------------ --------
(66.8) (57.9) (63.4)
----------------------------- ----- ------------ ------------ --------
Non-current liabilities
Borrowings 8 (16.8) (19.5) (13.9)
Contingent deferred
consideration - (1.4) (0.9)
Deferred income tax
liabilities (3.3) (3.6) (3.5)
Retirement benefit
obligations (19.0) (21.9) (19.9)
Provisions (0.3) (0.4) (0.3)
----------------------------- ----- ------------ ------------ --------
(39.4) (46.8) (38.5)
----------------------------- ----- ------------ ------------ --------
Total liabilities (106.2) (104.7) (101.9)
----------------------------- ----- ------------ ------------ --------
Net assets 39.6 34.5 37.7
----------------------------- ----- ------------ ------------ --------
Equity
Share capital 9 12.2 12.1 12.1
Share premium 0.9 0.9 0.9
Retained earnings 26.5 21.5 24.7
----------------------------- ----- ------------ ------------ --------
Total equity 39.6 34.5 37.7
----------------------------- ----- ------------ ------------ --------
The notes form an integral part of this condensed consolidated
half year report.
Condensed consolidated statement of changes in equity
for the half year ended 30 November 2017 (unaudited)
Share Share Retained Total
capital premium earnings equity
GBPm GBPm GBPm GBPm
--------------------------------- --------- --------- ---------- --------
Balance at 1 June 2016 12.0 0.9 23.8 36.7
--------------------------------- --------- --------- ---------- --------
Profit for the period - - 1.0 1.0
Items that will never be
reclassified to profit or
loss:
Re-measurement loss on the
defined benefit pension scheme - - (3.7) (3.7)
Tax on items that will never
be reclassified to profit
or loss - - 0.6 0.6
--------------------------------- --------- --------- ---------- --------
Total comprehensive expense
for the period - - (2.1) (2.1)
--------------------------------- --------- --------- ---------- --------
Transactions with owners:
Issue of shares 0.1 - (0.1) -
Value of employee services - - (0.1) (0.1)
--------------------------------- --------- --------- ---------- --------
0.1 - (0.2) (0.1)
--------------------------------- --------- --------- ---------- --------
Balance at 30 November 2016 12.1 0.9 21.5 34.5
--------------------------------- --------- --------- ---------- --------
Profit for the period - - 4.5 4.5
Items that will never be
reclassified to profit or
loss:
Re-measurement loss on the
defined benefit pension scheme - - 1.9 1.9
Tax on items that will never
be reclassified to profit
or loss - - (0.3) (0.3)
--------------------------------- --------- --------- ---------- --------
Total comprehensive income
for the period - - 6.1 6.1
--------------------------------- --------- --------- ---------- --------
Transactions with owners:
Dividend paid - - (2.8) (2.8)
Issue of shares - - - -
Value of employee services - - (0.1) (0.1)
--------------------------------- --------- --------- ---------- --------
- - (2.9) (2.9)
--------------------------------- --------- --------- ---------- --------
Balance at 31 May 2017 12.1 0.9 24.7 37.7
--------------------------------- --------- --------- ---------- --------
Profit for the period - - 1.5 1.5
Items that will never be
reclassified to profit or
loss:
Re-measurement loss on the
defined benefit pension scheme - - 0.5 0.5
Tax on items that will never
be reclassified to profit
or loss - - (0.1) (0.1)
--------------------------------- --------- --------- ---------- --------
Total comprehensive income
for the period - - 1.9 1.9
--------------------------------- --------- --------- ---------- --------
Transactions with owners:
Issue of shares 0.1 - (0.1) -
Value of employee services - - - -
--------------------------------- --------- --------- ---------- --------
0.1 - (0.1) -
--------------------------------- --------- --------- ---------- --------
Balance at 30 November 2017 12.2 0.9 26.5 39.6
--------------------------------- --------- --------- ---------- --------
The notes form an integral part of this condensed consolidated
half year report.
Condensed consolidated cash flow statement
for the half year ended 30 November 2017 (unaudited)
Half Half Year
year year ended
ended ended 31 May
30 November 30 November 2017
2017 2016 GBPm
GBPm GBPm
------------------------------------- ------------- ------------- --------
Cash flows from operating
activities
Operating profit 2.4 1.8 7.8
Adjustments for:
Depreciation and amortisation 2.3 2.1 4.2
Cash contributions to pension
scheme (0.7) (0.7) (1.3)
Other 0.1 0.1 0.1
------------------------------------- ------------- ------------- --------
Operating cash flows before
movements in working capital 4.1 3.3 10.8
Movements in working capital:
(Increase)/decrease in inventories (0.4) (1.3) (0.8)
(Increase)/decrease in receivables (7.3) (9.0) (8.5)
Increase/(decrease) in payables 3.0 4.7 9.5
Utilisation of provision - - (0.2)
------------------------------------- ------------- ------------- --------
Net cash (absorbed by)/generated
from operations (0.6) (2.3) 10.8
Interest paid (0.2) (0.2) (0.5)
Income tax paid (0.4) (0.6) (1.4)
------------------------------------- ------------- ------------- --------
Net cash (absorbed by)/generated
from operating activities (1.2) (3.1) 8.9
------------------------------------- ------------- ------------- --------
Cash flows from investing
activities
Purchase of intangible assets (0.1) (0.2) (0.3)
Purchase of property, plant
and equipment (1.5) (6.0) (9.1)
Payment of contingent consideration (0.5) - -
Proceeds on sale of property,
plant and equipment - 0.1 0.2
Net cash absorbed by investing
activities (2.1) (6.1) (9.2)
------------------------------------- ------------- ------------- --------
Cash flows from financing
activities
Increase in bank borrowings 3.0 8.0 2.4
Capital element of finance
lease and hire purchase payments (0.1) (0.1) (0.1)
Dividends paid - - (2.8)
------------------------------------- ------------- ------------- --------
Net cash generated from/(absorbed
by) financing activities 2.9 7.9 (0.5)
------------------------------------- ------------- ------------- --------
Net movement in cash and
cash equivalents (0.4) (1.3) (0.8)
Cash and cash equivalents
at beginning of period 1.0 1.8 1.8
------------------------------------- ------------- ------------- --------
Cash and cash equivalents
at end of period 0.6 0.5 1.0
------------------------------------- ------------- ------------- --------
The notes form an integral part of this condensed consolidated
half year report.
Notes to the condensed consolidated half year report
for the half year ended 30 November 2017 (unaudited)
1. General information
NWF Group plc ('the Company') is a public limited company
incorporated and domiciled in the UK under the Companies Act 2006.
The address of its registered office is NWF Group plc, Wardle,
Nantwich, Cheshire CW5 6BP.
The Company has its primary listing on AIM, part of the London
Stock Exchange.
These condensed consolidated interim financial statements
('interim financial statements') were approved for issue on 30
January 2018.
These interim financial statements do not constitute statutory
accounts within the meaning of Section 434 of the Companies Act
2006. The interim financial statements for the half years ended 30
November 2017 and 30 November 2016 are neither audited nor reviewed
by the Company's auditors. Statutory accounts for the year ended 31
May 2017 were approved by the Board of Directors on 1 August 2017
and delivered to the Registrar of Companies. The report of the
auditors on those accounts was unqualified, did not contain an
emphasis of matter paragraph and did not contain any statement
under Section 498 of the Companies Act 2006.
2. Basis of preparation and accounting policies
Except as described below, these interim financial statements
have been prepared in accordance with the principal accounting
policies used in the Company's consolidated financial statements
for the year ended 31 May 2017. These interim financial statements
should be read in conjunction with those consolidated financial
statements, which have been prepared in accordance with
International Financial Reporting Standards ("IFRS") as endorsed by
the European Union.
These interim financial statements do not fully comply with IAS
34 'Interim Financial Reporting', as is currently permissible under
the rules of AIM.
Taxes on income in the interim periods are accrued using the tax
rate that would be applicable to expected total annual
earnings.
The triennial actuarial valuation of the Group's defined benefit
pension scheme was completed in the half year ended 30 November
2017, with a deficit of GBP19.1 million at the valuation date of 31
December 2016. In these interim financial statements, this
liability has been updated in order to derive the IAS 19R valuation
as of 30 November 2017. The triennial valuation resulted in Group
contributions of GBP2.1 million per annum, including recovery plan
payments of GBP1.8 million per annum for 11 years from 1 January
2018.
The Directors consider that headline operating profit, headline
profit before taxation and headline earnings per share measures,
referred to in these interim financial statements, provide useful
information for shareholders on underlying trends and performance.
Headline profit before taxation is reported profit before taxation,
after adding back the net finance cost in respect of the Group's
defined benefit pension scheme, and the exceptional items and the
taxation effect thereon where relevant. The calculations of basic
and diluted headline earnings per share are shown in note 7 of
these interim financial statements.
Certain statements in these interim financial statements are
forward looking. The terms 'expect', 'anticipate', 'should be',
'will be' and similar expressions identify forward looking
statements. Although the Board of Directors believes that the
expectations reflected in these forward looking statements are
reasonable, such statements are subject to a number of risks and
uncertainties and actual results and events could differ materially
from those expressed or implied by these forward looking
statements.
A number of amendments to IFRS became effective for the
financial period beginning on 1 June 2017; however, the Group did
not have to change its accounting policies or make material
retrospective adjustments as a result of adopting these new
standards.
IFRS 9 and IFRS 15 are applicable for the year beginning 1 June
2018 but are not expected to have a material impact on the
Group.
IFRS 16 is applicable for the year beginning 1 June 2019. Under
IFRS 16 the present distinction between operating and finance
leases will be removed, resulting in all leases being recognised on
the balance sheet except for those with a very low value. At
inception, a right-of-use asset will be recognised together with an
equivalent liability reflecting the discounted lease payments over
the estimated term of the lease. Whilst the overall cost of using
the asset over the lease term should be the same, it is likely that
the weighting of the charge between periods may differ due to the
requirement to distinguish between the lease and non- lease
elements of the agreement. Adoption of this standard is likely to
result in an increase in gross assets and gross liabilities, and
the consolidated income statement is expected to have an increased
depreciation expense; however, the lease expense will reduce by a
similar amount. The Group will make an assessment of the full
impact in due course.
3. Segment information
The chief operating decision-maker has been identified as the
Board of Directors ('the Board'). The Board reviews the Group's
internal reporting in order to assess performance and allocate
resources. The Board has determined that the operating segments,
based on these reports, are Feeds, Food and Fuels.
The Board considers the business from a product/services
perspective. In the Board's opinion, all of the Group's operations
are carried out in the same geographical segment, namely the
UK.
The nature of the products/services provided by the operating
segments are summarised below:
Feeds - manufacture and sale of animal feeds and other agricultural products
Food - warehousing and distribution of clients' ambient grocery
and other products to supermarket and other retail distribution
centres
Fuels - sale and distribution of domestic heating, industrial and road fuels
Segment information about the above businesses is presented
below.
The Board assesses the performance of the operating segments
based on a measure of headline operating profit. Finance income and
costs are not included in the segment results which are assessed by
the Board. Other information provided to the Board is measured in a
manner consistent with that in the financial statements.
Inter-segment transactions are entered into under the normal
commercial terms and conditions that would also be available to
unrelated third parties.
Segment assets exclude deferred income tax assets and cash and
cash equivalents. Segment liabilities exclude taxation, contingent
deferred consideration, borrowings and retirement benefit
obligations. Excluded items are part of the reconciliation to
consolidated total assets and liabilities.
Half year ended Feeds Food Fuels Group
30 November 2017 Note GBPm GBPm GBPm GBPm
-------------------- ----- ------ ------ ------ ------
Revenue
Total revenue 80.5 19.8 201.0 301.3
Inter-segment
revenue (2.7) (0.3) (2.5) (5.5)
-------------------- ----- ------ ------ ------ ------
Revenue 77.8 19.5 198.5 295.8
-------------------- ----- ------ ------ ------ ------
Result
Headline operating
profit 0.4 0.9 1.1 2.4
-------------------- ----- ------ ------ ------
Operating profit
as reported 2.4
Finance costs 5 (0.5)
------
Profit before
taxation 1.9
Income tax expense 6 (0.4)
-------------------- ----- ------ ------ ------ ------
Profit for the
period 1.5
-------------------- ----- ------ ------ ------ ------
Other information
Depreciation and
amortisation 0.8 0.7 0.8 2.3
-------------------- ----- ------ ------ ------ ------
Feeds Food Fuels Group
As at 30 November 2017 GBPm GBPm GBPm GBPm
--------------------------- ------- ------ ------- --------
Balance sheet
Assets
Segment assets 52.6 31.0 58.4 142.0
--------------------------- ------- ------ -------
Deferred income tax
assets 3.2
Cash and cash equivalents 0.6
--------------------------- ------- ------ ------- --------
Consolidated total
assets 145.8
--------------------------- ------- ------ ------- --------
Liabilities
Segment liabilities (15.0) (4.2) (46.3) (65.5)
--------------------------- ------- ------ -------
Current income tax
liabilities (0.6)
Deferred income tax
liabilities (3.3)
Borrowings (16.9)
Contingent deferred
consideration (0.9)
Retirement benefit
obligations (19.0)
--------------------------- ------- ------ ------- --------
Consolidated total
liabilities (106.2)
--------------------------- ------- ------ ------- --------
Half year ended Feeds Food Fuels Group
30 November 2016 Note GBPm GBPm GBPm GBPm
--------------------- ----- ------ ------ ------ ------
Revenue
Total revenue 67.5 20.4 173.3 261.2
Inter-segment
revenue (2.4) (0.3) (2.6) (5.3)
--------------------- ----- ------ ------ ------ ------
Revenue 65.1 20.1 170.7 255.9
--------------------- ----- ------ ------ ------ ------
Result
Headline operating
profit (0.3) 1.6 0.9 2.2
--------------------- ----- ------ ------ ------
Segment exceptional
items 4 (0.4) - - (0.4)
------
Operating profit
as reported 1.8
Finance costs 5 (0.5)
------
Profit before
taxation 1.3
Income tax expense 6 (0.3)
--------------------- ----- ------ ------ ------ ------
Profit for the
period 1.0
--------------------- ----- ------ ------ ------ ------
Other information
Depreciation and
amortisation 0.6 0.8 0.7 2.1
--------------------- ----- ------ ------ ------ ------
Feeds Food Fuels Group
As at 30 November 2016 GBPm GBPm GBPm GBPm
--------------------------- ------- ------ ------- --------
Balance sheet
Assets
Segment assets 52.0 32.1 50.9 135.0
--------------------------- ------- ------ -------
Deferred income tax
assets 3.7
Cash and cash equivalents 0.5
--------------------------- ------- ------ ------- --------
Consolidated total
assets 139.2
--------------------------- ------- ------ ------- --------
Liabilities
Segment liabilities (13.3) (4.1) (40.4) (57.8)
--------------------------- ------- ------ -------
Current income tax
liabilities (0.4)
Deferred income tax
liabilities (3.6)
Borrowings (19.6)
Contingent deferred
consideration (1.4)
Retirement benefit
obligations (21.9)
--------------------------- ------- ------ ------- --------
Consolidated total
liabilities (104.7)
--------------------------- ------- ------ ------- --------
Year ended 31 Feeds Food Fuels Group
May 2017 Note GBPm GBPm GBPm GBPm
--------------------- ------- ------ ------ ------ ------
Revenue
Total revenue 158.2 39.6 364.0 561.8
Inter-segment
revenue - (0.6) (5.4) (6.0)
--------------------- ------- ------ ------ ------ ------
Revenue 158.2 39.0 358.6 555.8
--------------------- ------- ------ ------ ------ ------
Result
Headline operating
profit 1.5 3.0 4.5 9.0
--------------------- ------- ------ ------ ------
Segment exceptional
items 4 (1.2) - - (1.2)
------
Operating profit
as reported 7.8
Finance costs 5 (1.1)
------
Profit before
taxation 6.7
Income tax expense 6 (1.2)
--------------------- ------- ------ ------ ------ ------
Profit for the
year 5.5
--------------------- ------- ------ ------ ------ ------
Other information
Depreciation and
amortisation 1.2 1.5 1.5 4.2
--------------------- ------- ------ ------ ------ ------
Feeds Food Fuels Group
As at 31 May 2017 GBPm GBPm GBPm GBPm
--------------------- ------- ------ ----------------- ----------------
Balance sheet
Assets
Segment assets 53.1 30.1 51.9 135.1
Deferred income
tax assets 3.5
Cash at bank and
in hand 1.0
--------------------- ------- ------ ----------------- ----------------
Consolidated total
assets 139.6
--------------------- ------- ------ ----------------- ----------------
Liabilities
Segment liabilities (17.0) (3.5) (42.0) (62.5)
--------------------- ------- ------ -----------------
Current income tax
liabilities (0.6)
Deferred income
tax liabilities (3.5)
Borrowings (14.0)
Contingent deferred
consideration (1.4)
Retirement benefit
obligations (19.9)
--------------------- ------- ------ ----------------- ----------------
Consolidated total
liabilities (101.9)
--------------------- ------- ------ -----------------------------------
4. Profit before taxation - exceptional items
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2017 2016 2017
GBPm GBPm GBPm
----------------------- -------------- ------------- --------
Restructuring costs - (0.4) (1.2)
Net exceptional costs - (0.4) (1.2)
----------------------- -------------- ------------- --------
During the year ended 31 May 2017, the Group incurred
restructuring costs of GBP1.2 million in Feeds as it completed its
mill development projects in the North and Cheshire and the
associated restructuring to align the business with its production
facilities.
5. Finance costs
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2017 2016 2017
GBPm GBPm GBPm
--------------------------------- --------------------------- ------------- --------
Interest on bank loans
and overdrafts 0.2 0.2 0.5
--------------------------------- --------------------------- ------------- --------
Total interest expense 0.2 0.2 0.5
Net finance cost in respect
of the defined benefit pension
scheme 0.3 0.3 0.6
--------------------------------- --------------------------- ------------- --------
Total finance costs 0.5 0.5 1.1
--------------------------------- --------------------------- ------------- --------
6. Income tax expense
The income tax expense for the half year ended 30 November 2017
is based upon management's best estimate of the weighted average
annual tax rate expected for the full financial year ending 31 May
2018 of 20.9% (H1 2016: 20.9%).
7. Earnings per share
The calculation of basic and diluted earnings per share is based
on the following data:
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2017 2016 2017
GBPm GBPm GBPm
-------------------------------- --------------------------- ------------- --------
Earnings
Earnings for the purposes
of basic and diluted earnings
per share, being profit for
the period attributable to
equity shareholders 1.5 1.0 5.5
--------------------------------- -------------------------- ------------- --------
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2017 2016 2017
000s 000s 000s
------------------------------ ------------- ------------- --------
Number of shares
Weighted average number
of shares for the purposes
of basic earnings per share 48,646 48,599 48,620
Weighted average dilutive
effect of conditional share
awards (note 9) 14 45 24
------------------------------ ------------- ------------- --------
Weighted average number
of shares for the purposes
of diluted earnings per
share 48,660 48,644 48,644
------------------------------ ------------- ------------- --------
The calculation of basic and diluted headline earnings per share
is based on the following data:
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2017 2016 2017
GBPm GBPm GBPm
------------------------------------ --------------------------- ------------- --------
Profit for the period attributable
to equity shareholders 1.5 1.0 5.5
Add back:
Net finance cost in respect
of the defined benefit pension
scheme 0.3 0.3 0.6
Exceptional items - 0.4 1.2
Tax effect of the above (0.1) (0.1) (0.5)
------------------------------------ --------------------------- ------------- --------
Headline earnings 1.7 1.6 6.8
------------------------------------ --------------------------- ------------- --------
8. Financial instruments
The Group's financial instruments comprise cash, bank
overdrafts, invoice discounting advances, obligations under hire
purchase agreements, derivatives and various items such as
receivables and payables, which arise from its operations. There is
no significant foreign exchange risk in respect of these
instruments.
The carrying amounts of all of the Group's financial instruments
are measured at amortised cost in the financial statements, with
the exception of derivative financial instruments being forward
supply contracts. Derivative financial instruments are measured at
fair value subsequent to initial recognition.
The Group classifies fair value measurement using a fair value
hierarchy that reflects the significance of inputs used in making
measurements of fair value. The fair value hierarchy has the
following levels:
-- Level 1 fair value measurements are those derived from
unadjusted quoted prices in active markets for identical assets or
liabilities;
-- Level 2 fair value measurements are those derived from
inputs, other than quoted prices included within Level 1 above,
that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices); and
-- Level 3 fair value measurements are those derived from
valuation techniques that include inputs for the asset or liability
that are not based on observable market data (unobservable
inputs).
All of the Group's derivative financial instruments were
classified as Level 2 in the current and prior periods. There were
no transfers between levels in both the current and prior
periods.
The book and fair values of financial assets at 30 November
2017, other than non-interest bearing short-term trade and other
receivables, are as follows:
30 November 30 November 31 May
2017 2016 2017
Total book and fair value GBPm GBPm GBPm
----------------------------- ------------ ------------ -------
Financial assets carried
at fair value: derivatives 0.2 0.2 0.2
Financial assets carried
at amortised cost: cash
and cash equivalents 0.6 0.5 1.0
----------------------------- ------------ ------------ -------
Financial assets 0.8 0.7 1.2
----------------------------- ------------ ------------ -------
The book and fair values of financial liabilities at 30 November
2017, other than non-interest bearing short-term trade and other
payables, are as follows:
30 November 30 November 31 May
2017 2016 2017
Total book and fair value GBPm GBPm GBPm
----------------------------------- ------------ ------------ -------
Financial liabilities carried - - -
at fair value: derivatives
Financial liabilities carried
at amortised cost:
Hire purchase obligations
repayable within one year 0.1 0.1 0.1
0.1 0.1 0.1
----------------------------------- ------------ ------------ -------
Floating rate invoice discounting
advances 12.8 9.4 9.8
Revolving credit facility 4.0 10.0 4.0
Hire purchase obligations
repayable after more than
one year - 0.1 0.1
----------------------------------- ------------ ------------ -------
16.8 19.5 13.9
----------------------------------- ------------ ------------ -------
Financial liabilities 16.9 19.6 14.0
----------------------------------- ------------ ------------ -------
9. Share capital
Number
of shares Total
000s GBPm
------------------------------ ----------- ------
Allotted and fully paid:
ordinary shares of 25p each
Balance at 31 May 2016 48,528 12.0
Issue of shares (see below) 116 0.1
------------------------------ ----------- ------
Balance at 30 November 2016 48,644 12.1
Issue of shares - -
------------------------------ ----------- ------
Balance at 31 May 2017 48,644 12.1
Issue of shares (see below) 16 0.1
------------------------------ ----------- ------
Balance at 30 November 2017 48,660 12.2
------------------------------ ----------- ------
During the half year ended 30 November 2017, 15,900 (H1 2016:
116,139) shares with an aggregate nominal value of GBP3,975 (H1
2016: GBP29,035) were issued under the Company's conditional
Performance Share Plan.
The maximum total number of ordinary shares that may vest in the
future in respect of conditional Performance Share Plan awards
outstanding at 30 November 2017 amounted to 1,124,619 (H1 2016:
866,884) shares. These shares will only be issued subject to
satisfying certain performance criteria.
10. Half Year Report
Copies of this Half Year Report are due to be sent to
shareholders on 7 February 2018. Further copies may be obtained
from the Company Secretary at NWF Group plc, Wardle, Nantwich,
Cheshire CW5 6BP, or from the Company's website at
www.nwf.co.uk.
11. 2018 financial calendar
Interim dividend paid 1 May 2018
Financial year end 31 May 2018
Full year results announcement Early August 2018
Publication of Annual Late August 2018
Report and Accounts
Annual General Meeting 27 September 2018
Final dividend paid Early December 2018
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR BLMRTMBATBMP
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January 30, 2018 02:00 ET (07:00 GMT)
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