RNS Number:4192Q
Robinson PLC
24 August 2005
FOR IMMEDIATE RELEASE 24 August 2005
Robinson plc
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2005
Robinson plc ("Robinson" or "the Company"; stock code: RBN), the custom
manufacturer of paperboard and plastic packaging, has announced its unaudited
interim results for the six months ended 30 June 2005. Prior year figures have
been restated to reflect new accounting reporting standards, particularly with
respect to the treatment of the Company's pension fund.
Highlights:
* Despite difficult market conditions, sales in the plastic packaging
division increased by 6%, reflecting higher raw material and energy costs
which were passed on to customers
* Net new business gains in paperboard packaging, despite an ongoing
strategic shift away from smaller customers
* Improved margins in North America as a result of productivity gains
* #1.3 million acquisition of factory site in Poland to supply existing
and developing customer demand in the region
* Profit after tax #272k (2004: #580k)
* Interim dividend of 1.5p (2004: 1p)
Commenting on the results, Chairman, Richard Clothier said:
"With our commitment to product innovation, we are winning new business from
customers, despite higher production costs and the slowdown in the UK retail
sector. With a stronger order book and price increases in place, we remain
confident of the seasonal improvement in the remainder of the year."
"Robinson continues to invest in process improvements and automation, the
benefits of which yet are to be reflected in the financial results. Moreover,
our entry into the Central European marketplace, we believe, represents a
significant opportunity for the Company in the medium term."
About Robinson
Based in Chesterfield, and with additional manufacturing facilities in
Kirkby-in-Ashfield, Nottinghamshire, and in Toronto, Canada, Robinson currently
employs over 400 people. It was formerly a family business, with its origins
dating back some 165 years. Today the Company's main activities are in the
manufacture and sale of rigid paper packaging and injection moulded plastic
packaging. Robinson operates primarily within the food, drink, confectionery,
cosmetic and toiletry sectors, providing niche or custom manufacture to major
players in the fast moving consumer goods market, such as Nestle, Lever Faberge
and Whyte & Mackay. The Company also has a substantial property portfolio with
significant development potential.
For further information, please contact:
Jon Marx, Chief Executive, Robinson plc 01246 220022
Guy Robinson, Finance Director, Robinson plc 01246 220022
www.r1son.co.uk
Barry Saint, Arbuthnot Securities 020 7012 2000
Sue Scott/Michael Padley, Bankside Consultants 020 7367 8888
CHAIRMAN'S STATEMENT
I am pleased to report a satisfactory first half result in difficult market
conditions. The first half of the year is traditionally 'quieter' for our
packaging businesses and the depressed retail sector, coupled with increased raw
material and energy costs, have been reflected in our results.
The increase in sales is due largely to the pass through of increased raw
material prices. Underlying volumes were maintained as 2004 despite the retail
slowdown particularly in the second quarter. Gross profit was reduced by the
increased raw material and energy costs that could not all be passed through to
customers in the period, but was offset by productivity improvements. Overheads
were increased with extra spending on marketing and product innovation.
Exceptional items included a profit of #311,000 on the sale of surplus plant and
machinery against which we spent #117,000 on acquisition costs for our
manufacturing site in Poland and reviewing a potential acquisition in the UK.
There have been a number of changes to the accounts as a result of the latest
accounting reporting standards and these have resulted in a restatement of the
comparative numbers. The biggest single change is to the treatment of our
pension fund. The fund is a separate entity but we are required to show the
surplus in the fund on Robinson's balance sheet. In addition, we are required to
show a notional interest credit in the profit & loss account to represent
earnings attributable to the surplus. The net effect of these adjustments has
been to add #3.7m to our shareholders' funds in the balance sheet (as at the
start of this year) and a further #0.3m to the profit after tax in the 6 months
to June 2005. The fund was subject to its triennial actuarial valuation in April
this year and, whilst it was still shown to be in a healthy position, the
surplus in the balance sheet was reduced by #1m, after allowing for increased
mortality rates.
After these adjustments, the profit before tax reduced from #647,000 (last year)
to #358,000 in the first half of this year.
We invested #1.6m in the first half on capital equipment and working capital
increased in line with seasonal patterns resulting in a reduction of cash and
equivalents from #1.8m to #0.1m. Shareholders' funds overall reduced by 5%,
which was almost entirely due to the reduction in the pension surplus.
Robinson Plastic Packaging sales increased by 6% in the first half with
underlying volumes maintained at 2004 levels - the increase being driven by
higher plastic resin and electricity costs passed on to customers. Sales growth
has been achieved with several existing customers and we have acquired new
business worth around #0.5m per annum from Cryovac Sealed Air. The average
purchase cost of plastic resins in the first half was 31% higher than the
previous year and our electricity prices increased by 22% in April. Most of
these increases have been passed on to customers, although there has been some
resultant margin erosion, which has partially been offset by productivity
improvements with investment in process improvements and automation. Over #1m
was spent in the first six months on capital equipment, including #318,000 for a
new United Biscuits container and #200,000 on equipment for the Cryovac Sealed
Air business, the benefits of which may be expected in coming periods.
Robinson Paperboard Packaging (UK) sales were down 4% mostly as a result of our
decision to drop some smaller customers at the ends of 2003, which were still
running off in early 2004. This business normally experiences 'churn' each year
as customers launch and de-list products, particularly in the toiletries and
cosmetics sector. This year is no exception, but so far we have managed to win
more business than has been lost. A patent is in application for a new product
innovation, the COOL-AIR tube, which was launched into Sainsbury's for a
promotion of the Fetzer Rose wine brand. A new rectangular rigid box making
machine was installed that will expand the range of boxes that we can produce
and improve production efficiencies.
Robinson Paperboard Packaging (North America) sales were at a similar level to
the previous year with slightly improved margins as a result of productivity
improvements. Major accounts have performed well but some business has been lost
to competition from China. We have transferred a complete tube production line
from Chesterfield to Toronto and this is being used to increase efficiencies and
expand sales opportunities. Ron Zieske, who had been President of this operation
for 6 years resigned to take up a position in a larger organisation in his home
town of Cleveland, Ohio and we have appointed a local man, Stephen Wilkie, to
take over. Steve brings to Robinson over 20 years of paper packaging experience
and a successful record in general management.
We have very recently announced the purchase for #1.3m of a factory site in
Poland that we intend to adapt for the manufacture of plastic packaging products
for manufacturers in Central Europe. This has been in response to some customers
relocating a part of their production to this developing region and which we
believe offers an opportunity for Robinson. Manufacturing will commence when
relocation has been completed and is currently planned for the first quarter of
next year. The site is 2.3 hectares with around 12,000 m2 of buildings, built in
the 1970's to 90's, located in Lodz - in the centre of Poland, around and close
to the proposed new motorway North-South/East-West intersection. Relocation and
associated costs could amount to #0.5m over the next two years.
With a stronger order book and with price increases in place, we anticipate that
the second half of the year will see at least its usual seasonal improvement,
such that the overall performance in 2005 will be in line with our expectations.
The Board has approved an interim dividend of 11/2 p per share, payable on 3
October 2005 to shareholders registered on 2 September 2005. This is 50% higher
than the first interim dividend paid at the same time last year but, as stated
in my review of the 2004 report and accounts, it is our intention to pay two
dividends a year, the final dividend being in June 2006.
Richard Clothier 24 August 2005
Chairman
Robinson plc
GROUP PROFIT AND LOSS ACCOUNT
FOR THE SIX MONTHS ENDED 30 JUNE 2005
Notes Unaudited Unaudited Audited
Six months Six months Year to
to 30 June to 30 June 31 December
2005 2004 2004
(restated) (restated)
#'000 #'000 #'000
Turnover 11,297 11,068 25,949
Cost of sales (10,021) (9,730) (21,919)
------ ------ ------
Gross profit 1,276 1,338 4,030
Overheads,
excluding
exceptional
items (1,562) (1,344) (3,571)
Exceptional
items 3 194 (236) (430)
Overheads 2 (1,368) (1,580) (4,001)
----- ------ -------
Operating (loss)/ (92) (242) 29
profit
Profit on
disposal of
land and
buildings - 236 236
----- ----- -----
(Loss)/profit (92) (6) 265
on ordinary
activities
before
interest
Interest
received 20 133 146
Other finance
income in
respect of
Pension Fund 430 520 1,040
---- ---- -----
Profit on 358 647 1,451
ordinary
activities
before
taxation
---- ---- -----
Taxation 4 (86) (67) (430)
Profit on 272 580 1,021
ordinary
activities
after taxation
Dividends (279) (228) (368)
---- ----- ----
Retained (loss)/ (7) 352 653
profit ===== ===== ====
Earnings per
ordinary share 5 1.71p 2.99p 6.41p
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE SIX MONTHS ENDED 30 JUNE 2005
Unaudited Unaudited Audited
Six months Six months Year ended
to 30 June to 30 June 31 December
2005 2004 2004
(restated) (restated)
#'000 #'000 #'000
Profit for the period 272 580 1,021
Actuarial loss (959) (860) (1,721)
Currency translation
differences on foreign
currency net
investments - - (25)
----- ------ -------
Total losses (687) (280) (725)
recognised
GROUP BALANCE SHEET
AS AT 30 JUNE 2005
Unaudited Unaudited Audited
Six months Six months to Year ended
to 30 June to 30 June 31 December
2005 2004 2004
(restated) (restated)
#'000 #'000 #'000
Tangible fixed assets 15,761 15,092 15,001
Current assets
Stocks 2,546 2,551 1,640
Debtors 6,013 5,439 5,437
Current asset investments - - 1,002
Cash at bank and in hand 85 811 813
----- ----- -----
8,644 8,801 8,892
Creditors: amounts falling
due within one year (6,065) (5,858) (5,411)
------ ----- -----
Net current assets 2,579 2,943 3,481
------ ------ ------
Total assets less current 18,340 18,035 18,482
liabilities
Provisions for liabilities (615) (714) (614)
and charges
------ ------ ------
Net assets excluding pension 17,725 17,321 17,868
asset
Pension asset (net of
deferred tax) 2,513 4,405 3,318
------ ------ ------
Net assets including pension
asset 20,238 21,726 21,186
Capital and reserves
Called up share capital 80 80 80
Share premium account 398 398 398
Capital redemption reserve 216 216 216
Revaluation reserve 5,130 5,539 5,138
Profit and loss account 14,414 15,493 15,354
------ ------ ------
Equity Shareholders' Funds 20,238 21,726 21,186
GROUP CASH FLOW STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2005
Unaudited Unaudited Audited
Six months Six months Year ended
to 30 June to 30 June 31 December
2005 2004 2004
#'000 #'000 #'000
Cash inflow from operating activities
Operating (loss)/profit (92) (242) 29
Depreciation charges and
write-down of fixed assets 813 913 1,795
(Profit)/loss on sale of
other tangible fixed assets (311) 4 100
Other non-cash items 236 203 423
(Increase) in stocks (906) (947) (36)
(Increase)/decrease in
debtors (598) 86 448
Increase/(decrease) in
creditors 654 330 (190)
(Decrease)/increase in
provisions (22) 171 (40)
Net cash (outflow)/inflow ---- --- -----
from operating activities (226) 518 2,529
===== === =====
Returns on investments and servicing of
finance
Interest received 22 177 194
Interest paid - - (5)
-- --- ---
Net cash inflow from returns 22 177 189
on investments and servicing == === ===
of finance
Taxation
UK corporation tax refunded - 35 3
Capital expenditure and financial investment
Acquisition of tangible
fixed assets (1,592) (705) (1,596)
Sale of non-operational
properties - 686 686
Sales of other tangible
fixed assets 345 17 60
----- --- -----
Net cash outflow from (1,247) (2) (850)
capital expenditure and ======= === =====
financial investment
Equity dividends paid (279) (229) (368)
======= ==== =====
Net cash (outflow)/inflow (1,730) 499 1,503
before use of liquid ======= ==== =====
resources and financing
Management of liquid resources
Decrease in short-term cash
deposits with UK banks 1,002 8,081 7,580
Net cash inflow from
management of liquid ----- ----- -----
resources 1,002 8,081 7,580
===== ===== =====
Financing
Repurchase of share capital - (8,997) (8,997)
----- ------- -------
Net cash outflow from financing - (8,997) (8,997)
===== ======= =======
(Decrease)/increase in cash (728) (417) 86
===== ======= =======
Analysis of changes in cash during the year
Balance at 30 June 2005 85 310 813
Balance at 31 December 2004 813 727 727
---- ---- ---
Net cash (outflow)/inflow (728) (417) 86
==== ==== ===
Notes to the financial statements
1. Basis of preparation
The interim report, for a 26 week period, which was approved by the directors on
24 August 2004, does not comprise full accounts within the meaning of the
Companies Act 1985. The interim financial information is not audited. There have
been three changes to accounting policies since 31 December 2004:
a. The requirements of FRS17 on retirement benefits have been adopted in
the primary statements.
b. The cost of share options has been recognised in the profit and loss
account in accordance with FRS 20.
c. Dividends are now recognised when declared in accordance with FRS 21.
In all other respects the interim financial information has been prepared on a
consistent basis using the same accounting policies set out in the audited
accounts for the year to 31 December 2004.
Comparative figures for the year ended 31 December 2004 have been extracted from
the statutory accounts which have been filed with the Registrar of Companies and
on which the auditors gave an unqualified report, restated for the changes to
accounting policies described above.
2. Overheads
Unaudited Unaudited Audited
Six months to Six months to Year to
30 June 30 June 31 December
2005 2004 2004
#'000 #'000 #'000
Selling, marketing and
distribution costs 653 513 1,191
Administrative expenses
including exceptional items 826 1,211 2,948
Net income from let
properties (111) (144) (138)
----- ----- -----
1,368 1,580 4,001
===== ===== =====
3. Exceptional items
Unaudited Unaudited Audited
Six months to Six months to Year to
30 June 30 June 31 December
2005 2004 2004
#'000 #'000 #'000
Profit on sale of machinery 311 - -
Business start-up and
acquisition costs (117) - (194)
Costs of listing on AIM - (236) (236)
---- ----- ----
194 (236) (430)
==== ===== =====
4. Taxation
The taxation credit for the six months to 30 June 2005 has been calculated on
the basis of the estimated effective tax rate on profits before tax for the year
to 31 December 2005.
5. Earnings per share
The calculation of earnings per ordinary share is based on profit on ordinary
activities after taxation (#272,000) divided by the weighted average number of
shares in issue (15,918,501).
6. Interim Report
The Interim Report will be posted to shareholders shortly and further copies are
available from Robinson plc's Registered office: Bradbury House, Goytside Road,
Chesterfield, S40 2PH.
ENDS
This information is provided by RNS
The company news service from the London Stock Exchange
END
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