TIDMZYT
RNS Number : 0354O
Zytronic PLC
15 May 2018
15 May 2018
Zytronic plc
("Zytronic" or the "Group")
Interim Results for the six months ended 31 March 2018
Zytronic plc, a leading specialist manufacturer of touch
sensors, announces its consolidated interim results for the six
months ended 31 March 2018.
Overview
-- Group revenue of GBP10.6m (H1 2017: GBP11.3m)
-- Gaming revenues increased by 17%, offset by a decline in Financial revenues of 29%
-- Profit before tax of GBP2.2m (H1 2017: GBP2.5m)
-- Interim dividend increased by 100% to 7.60p per share (H1 2017: 3.80p)
-- Basic earnings per share ("EPS") of 11.7p (H1 2017: 13.8p)
-- Net cash of GBP13.7m (30 September 2017: GBP14.1m) following an increase to dividend payments
Commenting on the results, Chairman, Tudor Davies said:
"The second half of the year has started with some improvement
in demand from the ATM market and an increased number of projects
in the growing Gaming sector. This is consistent with the
improvement in trading normally experienced in the second half, and
whilst growth may be suppressed compared with recent years, we
expect to make good progress in developing our unique,
award-winning products, particularly in the USA and Asia."
Enquiries:
Zytronic plc
Mark Cambridge, Chief Executive
Claire Smith, Group Finance Director 0191 414 5511
N+1 Singer (Nominated Adviser
and Broker)
Aubrey Powell, Liz Yong 020 7496 3000
Notes to Editors
Zytronic is the developer and manufacturer of a unique range of
internationally award-winning and patented touch sensor products,
operating from three modern factories totaling 80,000ft(2) near
Newcastle-upon-Tyne in the United Kingdom.
Zytronic touch products employ an embedded sensing solution and
are readily configurable to enable multi-user and multi-touch touch
sensing sizes from five inches to ultra-large 85", making them an
ideal solution for system designers' specific requirements,
offering significant durability, environmental stability and
optical enhancement benefits to touch interactivity for industrial,
self-service and public access equipment.
Chairman's statement
Introduction
The Board is pleased to report a doubling of the interim
dividend to 7.6p (H1 2017: 3.8p) in line with our progressive
dividend policy, and the continued development of our business into
new markets, which in the first half has counteracted some deferral
in business from the Financial sector.
Results
Revenues for the first half to 31 March 2018 were GBP10.6m (H1
2017: GBP11.3m), with profit before taxation of GBP2.2m (H1 2017:
GBP2.5m).
There has been a considerable variation in demand across the
various sectors, resulting in a reduction in revenues. The most
positive has been Gaming which has increased by 17%, whereas in the
Financial sector, where we supply product for ATM manufacture,
demand has been unpredictable with projects being deferred and
sales lower than at this time last year. However, in recent weeks
we have seen some improvement in demand from the ATM market, and
the good progress in Gaming is continuing with an increasing number
of projects in the pipeline, and we expect further opportunities to
result from the change to direct sales representation in USA and
Asia.
Cash generation
Cash generation from operating activities improved to GBP2.4m
(H1 2017: GBP2.1m), of which GBP0.3m was invested into capital
expenditure, and with the 2017 final dividend payment of GBP2.4m,
some GBP0.7m higher than the 2016 final dividend payment, resulted
in cash balances of GBP13.7m (30 September 2017: GBP14.1m).
Dividend
The Directors have declared a 100% increase to the interim
dividend to 7.60p per share (H1 2017: 3.80p) payable on 20 July
2018 to shareholders on the Register on 6 July 2018, to facilitate
a move towards an improved balance between the interim and final
dividends for a fiscal year, whilst maintaining the Company's
progressive dividend policy.
Outlook
The second half of the year has started with some improvement in
demand from the ATM market and an increased number of projects in
the growing Gaming sector. This is consistent with the improvement
in trading normally experienced in the second half, and whilst
growth may be suppressed compared with recent years, we expect to
make good progress in developing our unique, award-winning
products, particularly in the USA and Asia.
Tudor Davies
Chairman
15 May 2018
Consolidated statement of comprehensive income
Unaudited results for the six months to 31 March 2018
Six months Six months Year to
to to
31 March 31 March 30 September
2018 2017 2017
Unaudited Unaudited Audited
Notes GBP'000 GBP'000 GBP'000
------------------------- ------ ----------- ----------- -------------
Group revenue 10,605 11,281 22,892
Cost of sales (6,408) (6,414) (13,481)
------------------------- ------ ----------- ----------- -------------
Gross profit 4,197 4,867 9,411
Distribution costs (213) (229) (393)
Administration expenses (1,806) (2,117) (3,591)
------------------------- ------ ----------- ----------- -------------
Group trading profit 2,178 2,521 5,427
Finance costs (3) (9) (24)
Finance revenue 27 5 10
------------------------- ------ ----------- ----------- -------------
Profit before tax 2,202 2,517 5,413
Tax expenses 3 (330) (366) (825)
------------------------- ------ ----------- ----------- -------------
Profit for the period 1,872 2,151 4,588
------------------------- ------ ----------- ----------- -------------
Earnings per share
Basic 4 11.7p 13.8p 29.0p
Diluted 4 11.7p 13.6p 28.8p
------------------------- ------ ----------- ----------- -------------
All profits are from continuing operations.
Consolidated statement of changes in equity
Unaudited results for the six months to 31 March 2018
Called
up
share Share Retained
capital premium earnings Total
GBP'000 GBP'000 GBP'000 GBP'000
------------------------------ -------- -------- --------- --------
At 1 October 2017 160 8,994 17,622 26,776
Profit for the period - - 1,872 1,872
Dividends - - (2,439) (2,439)
------------------------------ -------- -------- --------- --------
At 31 March 2018 (unaudited) 160 8,994 17,055 26,209
------------------------------ -------- -------- --------- --------
Consolidated balance sheet
Unaudited results at 31 March 2018
At At At
31 March 31 March 30 September
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
---------------------------------- ---------- ---------- -------------
Assets
Non-current assets
Intangible assets 1,660 1,585 1,633
Property, plant and equipment 6,790 7,228 7,030
----------------------------------- ---------- ---------- -------------
8,450 8,813 8,663
---------------------------------- ---------- ---------- -------------
Current assets
Inventories 2,969 3,479 2,996
Trade and other receivables 3,562 3,563 3,506
Derivative financial assets 28 - 54
Cash and short term deposits 13,730 13,520 14,099
----------------------------------- ---------- ---------- -------------
20,289 20,562 20,655
---------------------------------- ---------- ---------- -------------
Total assets 28,739 29,375 29,318
----------------------------------- ---------- ---------- -------------
Liabilities
Current liabilities
Trade and other payables 1,030 1,494 1,042
Financial liabilities - 1,049 -
Derivative financial liabilities - 442 -
Accruals 700 1,021 862
Tax liabilities 175 405 3
----------------------------------- ---------- ---------- -------------
1,905 4,411 1,907
---------------------------------- ---------- ---------- -------------
Non-current liabilities
Government grants 17 17 25
Deferred tax liabilities (net) 608 260 610
----------------------------------- ---------- ---------- -------------
625 277 635
---------------------------------- ---------- ---------- -------------
Total liabilities 2,530 4,688 2,542
----------------------------------- ---------- ---------- -------------
Net assets 26,209 24,687 26,776
----------------------------------- ---------- ---------- -------------
Equity
Equity share capital 160 159 160
Share premium 8,994 8,805 8,994
Revenue reserve 17,055 15,723 17,622
----------------------------------- ---------- ---------- -------------
Total equity 26,209 24,687 26,776
----------------------------------- ---------- ---------- -------------
Consolidated cashflow statement
Unaudited results for the six months to 31 March 2018
Six months Six months Year to
to to
31 March 31 March 30 September
2018 2017 2017
Unaudited Unaudited Audited
Notes GBP'000 GBP'000 GBP'000
-------------------------------------------- ------ ----------- ----------- -------------
Operating activities
Profit before tax 2,202 2,517 5,413
Net finance (revenue)/costs (24) 4 14
Depreciation and impairment of property,
plant and
equipment 369 387 749
Amortisation and impairment of intangible
assets 175 178 424
Loss on disposal of intangible assets - 28 -
Amortisation of government grant (8) (31) (42)
Fair value movement on foreign exchange
forward contracts 26 (517) (1,013)
Working capital adjustments
Decrease/(increase) in inventories 27 (719) (236)
(Increase)/decrease in trade and other
receivables (56) 316 239
(Decrease)/increase in trade and other
payables and provisions (165) 27 (356)
-------------------------------------------- ------ ----------- ----------- -------------
Cash generated from operations 2,546 2,190 5,192
Tax paid (195) (83) (521)
-------------------------------------------- ------ ----------- ----------- -------------
Net cashflow from operating activities 2,351 2,107 4,671
-------------------------------------------- ------ ----------- ----------- -------------
Investing activities
Interest received 27 5 10
Receipt of government grant - - 19
Payments to acquire property, plant
and equipment (103) (214) (472)
Payments to acquire intangible assets (202) (333) (600)
-------------------------------------------- ------ ----------- ----------- -------------
Net cashflow from investing activities (278) (542) (1,043)
-------------------------------------------- ------ ----------- ----------- -------------
Financing activities
Interest paid (3) (8) (24)
Dividends paid to equity shareholders
of the Parent (2,439) (1,744) (2,354)
Proceeds from share issues relating
to options - 1,044 1,234
Repayment of borrowings - (100) (1,148)
-------------------------------------------- ------ ----------- ----------- -------------
Net cashflow from financing activities (2,442) (808) (2,292)
-------------------------------------------- ------ ----------- ----------- -------------
(Decrease)/increase in cash and cash
equivalents (369) 757 1,336
-------------------------------------------- ------ ----------- ----------- -------------
Cash and cash equivalents at the beginning
of the period 14,099 12,763 12,763
-------------------------------------------- ------ ----------- ----------- -------------
Cash and cash equivalents at the end
of the period 6 13,730 13,520 14,099
-------------------------------------------- ------ ----------- ----------- -------------
Notes to the interim report
Unaudited results for the six months to 31 March 2018
1. Basis of preparation
The financial information in these interim statements is
prepared under the historical cost convention and in accordance
with international accounting standards. It does not constitute
statutory accounts as defined in Section 435 of the Companies Act
2006 and does not reflect all the information contained in the
Group's annual report and financial statements.
The tax charge is calculated by applying the Directors' best
estimate of the annual tax rate to the profit for the period. Other
expenses are accrued in accordance with the same principles used in
the preparation of the annual report and financial statements.
The interim results for the six months to 31 March 2018 are not
reviewed by Ernst & Young LLP and accordingly no opinion has
been given.
The interim financial statements have been prepared using the
same accounting policies and methods of computation used to prepare
the 2017 annual report and financial statements.
The financial information for the six months to 31 March 2018
and the comparative financial information for the six months to 31
March 2017 have not been audited. The comparative financial
information for the year ended 30 September 2017 has been extracted
from the 2017 annual report and financial statements.
The annual report and financial statements for the year ended 30
September 2017, which were approved by the Board of Directors on 11
December 2017, received an unqualified audit report, did not
contain a statement under Section 498(2) or (3) of the Companies
Act 2006 and have been filed with the Registrar of Companies.
The Group has one reportable business segment comprising the
development and manufacture of customised optical products to
enhance electronic display performance. Products in this reportable
business segment include touch sensors, filters and other laminated
products. All revenue, profits or losses before tax and net assets
are attributable to this reportable business segment.
2. Basis of consolidation
The Group results consolidate the accounts of Zytronic plc and
all its subsidiary undertakings drawn up to 31 March 2018.
3. Tax charge on profit on ordinary activities
The estimated tax rate for the year of 15% has been applied to
the half year's profit before tax, in accordance with the Auditing
Standard Board's statement on interim reports.
4. Earnings per share
Basic EPS is calculated by dividing the profit attributable to
ordinary equity holders of the Company by the weighted average
number of ordinary shares in issue during the period. All
activities are continuing operations and therefore there is no
difference between EPS arising from total operations and EPS
arising from continuing operations.
For the six months to 31 March 2018 and 2017
Weighted Weighted
average average
number number
Earnings of shares EPS Earnings of shares EPS
31 March 31 March 31 March 31 March 31 March 31 March
2018 2018 2018 2017 2017 2017
GBP'000 Thousands Pence GBP'000 Thousands Pence
------------------------------- --------- ---------- --------- --------- ---------- ---------
Profit on ordinary activities
after tax 1,872 16,044 11.7 2,151 15,626 13.8
------------------------------- --------- ---------- --------- --------- ---------- ---------
Basic EPS 1,872 16,044 11.7 2,151 15,626 13.8
------------------------------- --------- ---------- --------- --------- ---------- ---------
The weighted average number of shares for diluted EPS is
calculated by including the weighted average number of shares under
option.
Weighted Weighted
average average
number number
Earnings of shares EPS Earnings of shares EPS
31 March 31 March 31 March 31 March 31 March 31 March
2018 2018 2018 2017 2017 2017
GBP'000 Thousands Pence GBP'000 Thousands Pence
------------------------------- --------- ---------- --------- --------- ---------- ---------
Profit on ordinary activities
after tax 1,872 16,044 11.7 2,151 15,626 13.8
Weighted average number
of shares under option - - - - 168 (0.2)
------------------------------- --------- ---------- --------- --------- ---------- ---------
Diluted EPS 1,872 16,044 11.7 2,151 15,794 13.6
------------------------------- --------- ---------- --------- --------- ---------- ---------
For the year to 30 September 2017
Weighted
average
number
Earnings of shares EPS
30 September 30 September 30 September
2017 2017 2017
GBP'000 Thousands Pence
----------------------------------------- ------------- ------------- -------------
Profit on ordinary activities after tax 4,588 15,819 29.0
----------------------------------------- ------------- ------------- -------------
Basic EPS 4,588 15,819 29.0
----------------------------------------- ------------- ------------- -------------
The weighted average number of shares for diluted EPS is
calculated by including the weighted average number of shares under
option.
Weighted
average
number
Earnings of shares EPS
30 September 30 September 30 September
2017 2017 2017
GBP'000 Thousands Pence
------------------------------------------------ ------------- ------------- -------------
Profit on ordinary activities after tax 4,588 15,819 29.0
Weighted average number of shares under option - 131 (0.2)
------------------------------------------------ ------------- ------------- -------------
Diluted EPS 4,588 15,950 28.8
------------------------------------------------ ------------- ------------- -------------
5. Dividends
The Directors propose the payment of an interim dividend of
7.60p per share (H1 2017: 3.80p), payable on 20 July 2018 to
shareholders on the Register on 6 July 2018. This dividend has not
been accrued in these interim accounts. The dividend payment will
be approximately GBP1.2m.
Six months Six months Year to
to 31 March to 31 March 30 September
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
---------------------------------------------- ------------- ------------- --------------
Ordinary dividends on equity shares
Final dividend of 10.96p per ordinary share
paid on
3 March 2017 - 1,744 1,744
Interim dividend of 3.80p per ordinary share
paid on
21 July 2017 - - 610
Final dividend of 15.20p per ordinary share
paid on
9 March 2018 2,439 - -
---------------------------------------------- ------------- ------------- --------------
2,439 1,744 2,354
---------------------------------------------- ------------- ------------- --------------
6. Cash and cash equivalents
Six months Six months Year to
to 31 March to 31 March 30 September
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
-------------------------- ------------- ------------- --------------
Cash at bank and in hand 13,730 13,520 14,099
-------------------------- ------------- ------------- --------------
For the purpose of the consolidated cashflow statement, cash and
cash equivalents comprise the following:
Six months Six months Year
to 31 March to 31 March to 30
September
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
-------------------------- -------------- -------------- ------------
Cash at bank and in hand 11,382 10,709 11,679
Short term deposits 3,030 3,671 3,089
Bank overdraft (682) (860) (669)
-------------------------- -------------- -------------- ------------
13,730 13,520 14,099
-------------------------- -------------- -------------- ------------
Cash at bank earns interest at floating rates based on daily
bank deposit rates. Short term deposits are made for variable
lengths, being overnight, three months or one year (with break
conditions), depending on the immediate cash requirements of the
Group, and earn interest at variable rates.
At 31 March 2018 the Group had available a net GBP1.0m (cash
less overdrawn accounts) overdraft facility from Barclays Bank plc
which will fall for review in November 2018.
The fair value of cash and cash equivalents is GBP13.7m (H1
2017: GBP13.5m).
7. Availability of the interim report
A copy of the interim report is available on the Company's
website, www.zytronicplc.com, and can be obtained from the
Company's registered office: Whiteley Road, Blaydon-on-Tyne, Tyne
and Wear NE21 5NJ. Copies will be sent to shareholders shortly. A
copy of the presentation made to institutional investors is also
available on the Company's website.
Corporate information
Websites:
www.zytronicplc.com
www.zytronic.co.uk
www.zytronic-inc.com
www.zytronic.cn
www.zytronic.jp
Secretary
Claire Smith
Email: claire.smith@zytronic.co.uk
Registered office
Whiteley Road
Blaydon-on-Tyne
Tyne and Wear
NE21 5NJ
Tel: 0191 414 5511
Fax: 0191 414 0545
Registration number
3881244
Nominated Adviser and Broker
N+1 Singer
One Bartholomew Lane
London
EC2N 2AX
Registrars
Computershare Investor Services PLC
The Pavilions
Bridgwater Road
Bristol
BS13 8AE
Auditors
Ernst & Young LLP
Citygate
St James' Boulevard
Newcastle-upon-Tyne
NE1 4JD
Bankers
Barclays Bank plc
71 Grey Street
Newcastle-upon-Tyne
NE99 1JP
Handelsbanken
8 Keel Row
The watermark
Gateshead
NE11 9SZ
Santander Corporate Banking
Baltic Place
South Shore Road
Gateshead
NE8 3AE
Yorkshire Bank
131-135 Northumberland Street
Newcastle-upon-Tyne
NE1 7AG
Regions Bank
2653 Marietta Hwy
Canton, GA
30114
USA
Solicitors
Ward Hadaway
Sandgate House
102 Quayside
Newcastle-upon-Tyne
NE1 3DX
Muckle LLP
Time Central
32 Gallowgate
Newcastle-upon-Tyne
NE1 4BF
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR FKQDKOBKDFPD
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