Samuel Heath & Sons PLC Half-Year Report

Samuel Heath & Sons plc
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Samuel Heath & Sons PLC (LON:HSM)  

INTERIM REPORT 

Half year ended 30 September 2017

 

CHAIRMAN’S STATEMENT 

The first half of the year was satisfactory. Revenue was up at £7.377m (2016: £6.635m). The profit before tax was 5.6% down at £687k (2016: £728k), the previous year having benefitted from the windfall drop in Sterling after the Brexit referendum as I reported in my last full year’s statement.

We sell all over the world, with exports increasing by 18%, but our performance has been very patchy in nearly all of our markets, with some doing much better than expected, some worse.

Although it is only a relatively short time since the end of September, we have to say that sales generally have weakened, particularly in the U.K. market, where the number of projects in the pipeline have decreased, not enormously but perhaps significantly.   As always, it is difficult to forecast how this will affect the twelve months figures.

For the future, it is perhaps trite to say that we would prefer more clarity, but we would.

We are proposing an interim dividend of 5.5p per share (2016: deferred interim dividend of 5.5p), which will be paid on 23 March 2018.

 

Unaudited Interim Financial Report

For the Half Year ended 30 September 2017

 

 

CONSOLIDATED INCOME STATEMENT

Half year ended 30 September

Half year ended 30 September

Year ended 31 March

 

2017

2016

2017

Unaudited

Unaudited

Audited

£’000

£’000

£’000

Continuing operations

Revenue

7,377

          6,635

         13,053

Cost of sales

(3,707)

  (3,141)

(6,386)

Gross profit

3,670

          3,494

            6,667

Distribution costs

(1,868)

(1,664)

(3,274)

Administrative expenses

(1,025)

(998)

(1,949)

Operating profit

777

           832

            1,444

Finance costs

                (90)

 (104)

(210)

Profit before taxation

687

              728

             1,234

 

Taxation

            

              (131)

             

               (149)

 

(221)

Profit for the period

556

              579

             1,013

Basic and diluted earnings per ordinary share

21.9p

22.8p

40.0p

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Half year ended 30 September

Half year ended 30 September

Year ended 31 March

 

2017

2016

2017

Unaudited

Unaudited

Audited

£’000

£’000

£’000

Profit for the period

             556

              579

             1,013

Items that will be reclassified to profit or loss:

Cash flow hedges

               25

              15

               16

           25

              15

              16

Items that will not be reclassified to profit or loss:

Actuarial (loss) on defined benefit pension scheme

(34)

 (4,762)

            (629)

Deferred tax on actuarial loss

Revaluation of property, plant and Equipment

Deferred taxation on revaluation of assets

           6

738

            46

1,607

(218)

        (28)

(4,024)

          806

Total comprehensive income for the period

        553

(3,430)

          1,835

            

             

 CONSOLIDATED STATEMENT OF FINANCIAL POSITION

At 30 September

 At 30 September

    At 31   March

2017

2016

2017

 

 

Unaudited

Unaudited

Audited

£’000

£’000

£’000

Non-current assets

Intangible assets

50

99

              79

Property, plant and equipment

3,398

1,848

           3,511

Deferred tax asset

791

1,836

           793

4,239

3,783

           4,383

Current assets

Inventories

3,901

3,537

           3,789

Trade and other receivables

2,342

1,978

           2,169

Derivative financial instruments

         25

                  –

                   –

Cash and cash equivalents

           2,170

           2,268

           2,079

           8,438

           7,783

           8,037

Total assets

        12,677

          11,566

          12,420

Current liabilities

Trade and other payables

(1,327)

(1,290)

(1,400)

Current tax payable

(289)

(296)

(158)

(1,616)

(1,586)

(1,558)

Non-current liabilities

Retirement benefit scheme

(6,463)

(10,805)

(6,501)

Deferred tax liability

(79)

(6,463)

(10,884)

(6,501)

Total liabilities

(8,079)

(12,470)

(8,059)

Net assets

            4,598

          (904)

          4,361

Equity

Called up share capital

            254

             254

             254

Capital redemption reserve

            109

             109

             109

Revaluation reserve

Retained earnings

1,346

2,889

(1,267)

1,389

2,609

Equity shareholders’ funds

           4,598

          (904)

          4,361

 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

 

Share capital

Capital redemption reserve

Revaluation reserve

Retained earnings

Total equity

£000

£000

£000

£000

£000

Balance at 31 March 2016

254

109

    2,337

     2,700

Equity dividends paid

        (174)

 (174)

Profit for period

            579

          579

Other comprehensive loss for the period

      (4,009)

      (4,009)

Total comprehensive loss for the period

(3,430)

(3,430)

Balance at 30 September 2016

254

109

      (1,267)

     (904)

Equity dividends paid

Profit for period

            434

            434

Other comprehensive income for the period

1,389

3,442

4,831

Total comprehensive income for the period

1,389

3,876

5,265

Balance at 31 March 2017

254

109

1,389

         2,609

     4,361

Equity dividends paid

         (316)

(316)

Profit for period

            556

        556

Other comprehensive income for the period

         (3)

(3)

Total comprehensive income for the period

          553

553

Transfer relating to amortisation

(43)

43

Balance at 30 September 2017

254

109

1,346

        2,889

      4,598

 

CONSOLIDATED CASH FLOW STATEMENT                       

Half year ended 30 September

Half year ended 30 September

Year ended 31 March

2017

2016

2017

Unaudited

Unaudited

Audited

£’000

£’000

£’000

Cash flow from operating activities

Profit for the period before tax

686

             728

           1,234

Adjustments for:

Depreciation

              186

             130

             272

Amortisation

                28

               29

               57

Profit/(loss) on disposal of property, plant and equipment

10

               (18)

              (37)

Finance income

(4)

                (5)

             (7)

Defined benefit pension scheme expenses

              126

             132

             282

Contributions to defined benefit pension scheme

(200)

             (189)

            (511)

Operating cash flow before movements in working capital

              832

             807

          1,290

Changes  in working capital:

(Increase)/decrease in inventories

(107)

 (216)

(468)

(Increase)/decrease in trade and other receivables

             (203)

              134

              (16)

Increase/(decrease) in trade and other payables

               (40)

              13

             117

Cash generated from operations

               482

            738

           923

Taxation paid

                –

(155)

Net cash from operating activities

482

            738

768

Cash flow from investing activities

Payments to acquire property, plant and equipment

(80)

            (397)

            (646)

Proceeds from the sale of property, plant and equipment

                 –

               18

             53

Proceeds from sale of financial assets

                 –

                –

                (8)

Finance income

                 5

               5

             8

(75)

           (374)

           (593)

Cash flow from financing activities

Dividends paid

(316)

(174)

(174)

(316)

(174)

(174)

Net increase/(decrease) in cash and cash equivalents

91

190

           1

 

Cash and cash equivalents at beginning of period

2,079

          2,078

         2,078

Cash and cash equivalents at end of period

2,170

          2,268

          2,079

  

 

1.             BASIS OF PREPARATION OF INTERIM REPORT

As permitted, IAS34 ‘Interim Financial Reporting’ has not been applied in this interim report. The information for the period ended 30 September 2017 is not audited and does not constitute statutory accounts as defined in section 435 of the Companies Act 2006.  The statutory accounts for the year ended 31 March 2017 were given an unqualified audit report and did not contain statements under section 498(2) or 498(3) of the Companies Act 2006. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The interim accounts for the half year ended 30 September 2016 were also unaudited.

2.             ACCOUNTING POLICIES

Basis of accounting

The report has been prepared on a going concern basis in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) at 30 September 2017 as well as all interpretations issued by the International Financial Reporting Interpretations Committee (“IFRIC”) at 30 September 2017.

 

The group has not availed itself of early adoption options in such standards and interpretations.

The principal accounting policies adopted are as set out in the Annual Report for the year ended 31 March 2017. The valuation of inventories is considered to be the main area in terms of significant accounting estimates and judgements.

The retirement benefit scheme liability recognised in these interim accounts reflects the estimated change in the deficit at 30 September 2017 from the movements in discount rates and inflation during the six months.

3.             DIVIDENDS

 

An Interim dividend of 5.5p per share is proposed, payable on 23 March 2018. (30 September 2016: nil, although a deferred interim dividend was paid in August 2017 of 5.5p)

4.            EARNINGS PER SHARE 

The basic and diluted earnings per share are calculated by dividing the relevant profit after taxation of £556,000 (30 September 2016: £579,000) by the average number of ordinary shares in issue during the period being 2,534,322 (2016: 2,534,322). The number of shares used in the calculation is the same for both basic and diluted earnings.

 

 

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