RNS Number:3105Q
Sinclair (William) Holdings PLC
18 March 2008
18 March 2008
WILLIAM SINCLAIR HOLDINGS PLC
INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2007
William Sinclair Holdings Plc is one of the UK's leading producers of commercial
horticulture and branded garden products. The Company provides peat based and
non peat growing media and fertiliser products to the retail and commercial
sectors. William Sinclair's well established brands include J Arthur Bower's,
Silvaperl and New Horizon - the leading brand in the fast growing peat free
garden compost and organic plant foods sector.
William Sinclair's customers include national accounts such as Wyevale,
Wilkinson, Tesco, Homebase and B&Q as well as an extensive range of independent
garden centres.
The Company has strong asset backing, is profitable and is quoted on the
Alternative Investment Market ("AIM").
FINANCIAL HIGHLIGHTS
* Group turnover increased 11.3% to �11.8 million (2006: �10.6 million)
* Strong performance of Freeland following increased demand for
specialist top soils
* Increased focus on environmental products and further withdrawal from
non-profitable operations
* Good levels of both finished goods and raw materials stock ahead of
traditional busy selling period
* Loss before tax of �1.33 million (2006: �1.25 million) reflecting
expected seasonality of the business
* Interim dividend for the half year is unchanged at 1.0p per share
* Acquisition and integration of Joseph Metcalf in January 2008
progressing well
Bernard Burns, Chief Executive, William Sinclair Holdings Plc, said:
"Having successfully reduced our cost base and improved the productivity of the
business our focus on environmentally friendly non-peat based products and a
clear acquisition strategy is generating exciting opportunities for the Company.
"Freeland has performed particularly strongly. With pressure on Councils to
recycle increasing amounts of green waste from urban areas, our supply of this
material for our top soils and other non-peat based products is assured.
"As the lowest cost producer in the industry with the shortest haulage
distances, any increase in transport costs will affect the Company less than its
competitors allowing us to limit price increases.
"William Sinclair's growth is well into its second phase and we remain confident
about the prospects for the Company."
For further information:
William Sinclair Holdings Plc Tel: 01522 537561
Bernard Burns, Chief Executive
Peter Williams, Finance Director
Arbuthnot Securities Tel: 020 7012 2000
Alastair Moreton
Alasdair Younie
Madano Partnership Tel: 020 7593 4000
Mark Way
Matthew Moth
Introduction
I am pleased to report our unaudited results for the 6 months ended 31 December
2007.
The underlying performance of the Group continues to show improvement and we
have made further good progress with our strategic plans despite the very poor
weather conditions in July and August of last year.
Trading Review
Group turnover during the period was �11.8 million (2006: �10.6 million), an
increase of 11.3%. This includes, for the first time, sales at Freeland which
was previously treated as a joint venture. Without these sales, turnover was
slightly lower reflecting our continuing emphasis on more profitable business.
The first half of our year is, traditionally, affected by seasonal factors and
we recorded a loss before tax of �1.33 million, slightly higher than the �1.25
million in the same period of 2006. The basic loss per share was 5.8p (2006:
5.2p) and the diluted loss per share was 5.6p (2006: 5.0p). Net debt, as at 31
December 2007, was �6.5 million (2006: �5.6 million).
The interim dividend for the half year is unchanged at 1.0p per share.
Business Review
The exceptionally good weather in the early part of 2007 encouraged sales and
the peat harvest started well. Unfortunately, unprecedented rainfall in July and
August meant our peat extraction in these two months was well below previous
levels and slightly less than 50% of our budget. Consequently, we were unable
to recover all of our fixed costs and our margins decreased.
However, the peat is not lost to us and our stocks are sufficient for the coming
season. We did, however, prudently order small volumes of more expensive
substitute materials. These are particularly useful for our award winning, peat
reduced composts. In addition, we are pleased with the retail listings secured
for the forthcoming season, especially within multiple accounts.
We acquired a further 37.5% in Freeland, a green waste recycling business in
July 2007 increasing our stake to 87.5%. As a consequence, Freeland's sales and
profits are now fully consolidated in the group results. Freeland had a very
good half year and we look forward to further growth from this important part of
the Group.
In September last year we won the prestigious GIMA Supplier of the Year award
for our service and quality which was a further reflection of the progress we
have made in these key areas.
In January 2008, we announced the acquisition of Joseph Metcalf Ltd., a company
trading as GEM, located in North West England and with a very similar product
range to William Sinclair. The total consideration was �2.95 million, paid in
cash. Our post-acquisition review of Metcalf has confirmed the many synergies
we had identified in purchasing, administration, production and harvesting.
Integration of the new business is going well and our turnover and profits will
benefit from this acquisition in the remaining 9 months of our 15 month
financial period to 30 September 2008.
Change of year end
We have previously reported that we are changing the year end to 30 September
and, accordingly, we will issue a second interim report in June 2008 for the 9
months to 30 March 2008.
Outlook
We have experienced significant cost price increases on chemicals, plastics and
fuel but we believe our continued focus on cost reduction and productivity will
allow us to mitigate these increases. Furthermore we are implementing certain
price increases to enable us to maintain our margins.
We are very pleased with the performance of Freeland in the 6 months ended 31
December 2007 and anticipate further progress during the rest of the financial
period. The integration of the Metcalf acquisition made in January 2008 is
progressing well and, with additional retail listings, the Board remains
confident of meeting expectations for the 15 months ended 30 September 2008.
Bill Simpson
Chairman
Consolidated Income Statement Six months Six months Year
for the six months ended 31 December 2007 (unaudited) ended ended ended
31 December 31 December 30 June
2007 2006 2007
Notes �'000 �'000 �'000
Revenue 11,816 10,631 37,646
Operating expenses (13,110) (11,858) (36,070)
Operating (loss)/profit (1,294) (1,227) 1,576
Share of post tax profit of joint ventures accounted
for using the equity method (5) 49 173
Group operating profit from continuing operations (1,299) (1,178) 1,749
Finance revenue 19 2 11
Finance costs (139) (79) (326)
Other finance expenses - pensions 87 6 12
Profit from continuing operations before taxation (1,332) (1,249) 1,446
Tax expense 1 371 390 (319)
Profit for the period (961) (859) 1,127
Profit for the period is attributable to:
Equity holders of the parent company (995) (859) 1,127
Minority interests 34 - -
(961) (859) 1,127
Earnings per share (pence)
Basic EPS on profit for the period 3 (5.8)p (5.2)p 6.8p
Diluted EPS on profit for the period (5.6)p (5.0)p 6.7p
Dividends per share 2 1.0p 1.0p 3.5p
Consolidated Statement of Recognised Income and Six months Six months Year
Expenses ended ended ended
31 December 31 December 30 June
2007 2006 2007
�'000 �'000 �'000
Actuarial gains on defined benefit pension scheme 482 56 2,463
Revaluation of property, plant and equipment - - -
Tax on items taken directly to or transferred from (135) (17) (641)
equity
Net Income recognised directly in equity 347 39 1,822
(Loss)/profit for the period (995) (859) 1,127
Total recognised income and expense for the period (648) (820) 2,949
Consolidated Balance Sheet
as at 31 December 2007 (unaudited) As at As at As at
31 December 31 December 30 June
2007 2006 2007
�'000 �'000 �'000
Non-current assets
Property, plant and equipment 13,325 12,688 12,900
Intangible assets 1,456 1,149 1,130
Investments accounted for using the equity method 208 907 777
14,989 14,744 14,807
Current assets
Inventories 9,959 8,880 5,150
Trade and other receivables 7,305 6,026 10,981
Cash and short term deposits 1,112 155 335
18,376 15,061 16,466
Total assets 33,365 29,805 31,273
Current liabilities
Trade and other payables (6,223) (5,216) (9,824)
Financial liabilities (6,992) (5,073) (119)
Corporation tax payable (442) (131) (348)
(13,657) (10,420) (10,291)
Non-current liabilities
Financial liabilities (577) (697) (637)
Deferred tax liabilities (1,720) (931) (1,513)
Provisions (198) (182) (189)
Defined benefit pension plan deficit (1,758) (4,850) (2,303)
(4,253) (6,660) (4,642)
Total liabilities (17,910) (17,080) (14,933)
Minority interests (165) - -
Net assets after minority interests 15,290 12,725 16,340
Capital and reserves
Equity share capital 4,139 4,139 4,139
Capital redemption reserve 1,523 1,523 1,523
Revaluation reserve 3,566 3,501 3,566
Other reserves 176 176 176
Share based payments 63 40 51
Retained earnings 5,823 3,346 6,885
Group shareholders' equity 15,290 12,725 16,340
Consolidated cash flow statement
for the six months ended 31 December 2007 (unaudited)
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2007 2006 2007
�'000 �'000 �'000
Net cash flow from operating activities (4,872) (3,834) 2,162
Net cash flow from investing activities (611) (516) (959)
Net cash flow from financing activities (613) (470) (888)
(Decrease)/ Increase in cash in the period (6,096) (4,820) 315
Cash and cash equivalents at 1 July 2007 335 20 20
(Decrease)/Increase in cash and cash equivalents (6,096) (4,820) 315
Cash and cash equivalents at 31 December 2007 (5,761) (4,800) 335
Cash flow from operating activities
Operating profit (1,294) (1,227) 1,576
Amortisation of intangible assets 10 10 35
Depreciation 566 512 1,032
(Profit) on disposal of fixed assets 4 (5) (291)
Share based payments 12 12 23
Movement in provisions (107) (116) -
Pension contributions paid less amounts recognised in
the income statement. 24 (95) (28)
Operating profit before changes in working capital
and provisions (785) (909) 2,347
(Increase)/decrease in stocks (4,711) (3,913) (183)
(Increase)/decrease in debtors 4,929 6,574 1,259
(Decrease)/increase in creditors (4,314) (5,598) (1,106)
Movement in reinstatement provision 9 12 19
Income taxes received - - (174)
(4,872) (3,834) 2,162
Cash flow from investing activities
Interest received 19 2 11
Sale of property, plant and equipment 12 5 606
Purchase of property, plant and equipment (641) (523) (1,570)
Purchase of intangible assets - - (6)
Purchase of shares in subsidiary (757) - -
Cash on consolidation of subsidiary 756 - -
(611) (516) (959)
Cash flow from financing activities
Interest paid (139) (79) (320)
Dividends paid to equity shareholders (414) (331) (496)
Dividend received from joint venture - - 47
Repayment of borrowings (36) (36) (72)
Repayment of capital element of finance leases (24) (24) (47)
(613) (470) (888)
Reconciliation of net cash flow to movement in net debt
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2007 2006 2007
�'000 �'000 �'000
(Decrease)/Increase in cash in the period (6,096) (4,820) 315
Cash outflow/(inflow) from change in debt 60 60 119
Movement in net debt in the period (6,036) (4,760) 434
Net debt at 1 July 2007 (421) (855) (855)
Net debt at 31 December 2007 (6,457) (5,615) (421)
Notes to the Accounts
1. Taxation
The taxation credit on ordinary activities is calculated by applying the
Directors' best estimate of the annual taxation rate to the loss for the period.
2. Dividend
The interim dividend of 1.0p per share will be paid on 6 May 2008 to
shareholders on the register on 11 April 2008.
3. Earnings per share
Earnings per share have been calculated by reference to 16,554,046 shares in
issue.
4. Reconciliation of movements in equity attributable to members of
the parent company
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2007 2006 2007
�'000 �'000 �'000
Opening equity attributable to members of parent company 16,340 13,864 13,864
Total recognised income and expenses for the period (648) (820) 2,949
Dividends paid (414) (331) (496)
Share based payments taken directly to equity 12 12 23
Closing equity attributable to members of the parent company 15,290 12,725 16,340
5. Acquisition of shareholding in Freeland Horticulture Ltd
In July 2007 the group acquired an additional 37.5% of Freeland Horticulture Ltd
taking its stake to 87.5%. As a consequence Freeland is no longer accounted for
as a joint venture but is consolidated in full in the accounts of the group with
effect from July 2007. The interests of the minority shareholder in the results
of the business for the period to 31 December 2007 are shown in the Consolidated
Income Statement and the interests in the net assets of the business at 31
December 2007 are shown in the Consolidated Balance Sheet. The cost of the
acquisition was �757,000 and the fair value of the assets acquired was �422,000.
6. Basis of preparation of accounts
The company has adopted International Financial Reporting Standards for the
preparation of these interim accounts. The standards have been applied
consistently for the six months to 31 December 2007 and for all comparatives
shown.
The interim report has been approved by the Board of Directors and is neither
audited nor reviewed. The information does not constitute statutory accounts
within the meaning of section 240 of the Companies Act 1985. The statutory
accounts for the year ended 30 June 2007 received an unqualified audit report
and have been filed with the Registrar of Companies.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SFDFAWSASELD
William Sinclair (LSE:SNCL)
Historical Stock Chart
From Jul 2024 to Jul 2024
William Sinclair (LSE:SNCL)
Historical Stock Chart
From Jul 2023 to Jul 2024
