REG - Heath(Samuel) & Sons - Half-year Report
12/11/2021 07:05
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20211112:nRSL1386Sa&default-theme=true
RNS Number : 1386S Heath(Samuel) & Sons PLC 12 November 2021
SAMUEL HEATH & SONS plc
("the Company")
UNAUDITED INTERIM REPORT
Half year ended 30 September 2021
CHAIR'S STATEMENT
This is my first statement as Chair following the passing of Sam Heath. Sam
had an enormous influence on the Company over his working life and we will
greatly miss him. He has however left behind a strong board of directors and
senior executive team.
Our trading performance for the six months to 30 September 2021 reflected the
successful navigation of the Company from the destabilising effects of the
global Covid-19 virus and related lockdowns. Profit before tax of £776k was
achieved compared to a £224k loss before tax after exceptional items in the
Covid impacted period ended 30 September 2020 and a profit of £363k in the
pre-Covid period ended 30 September 2019. Sales recovered to £6.9 million
(2020: £4.9m and 2019: £6.9m), with performance continuing to improve as the
pandemic restrictions eased. The primary driver of improved profitability was
a post-Covid 'bounce' in sales and strong order book growth. We were also able
to avoid any significant export logistical issues. The increase in sales was
achieved while maintaining much of the cost savings implemented during
lockdown, thereby improving margins. The UK Government furlough scheme made a
very minor contribution. This brought our total half year results to a profit
after tax of £651k (2020: loss after tax of £181k).
Looking forward to the second six months of the year, we have entered the
period with solid momentum and a healthy order book. However, there is
uncertainty regarding how long the Covid bounce will last and whether a Covid
resurgence over the winter could cause renewed disruption to sales and
operations. So far, we have managed supply disruptions well, raising stock
levels where prudent or finding alternative sources. However, there remains
the possibility that we will struggle to source some materials, as a result of
further import disruption and the knock-on effects of high energy costs and
interrupted transport logistics. So, all in all, it is not possible to predict
with confidence that the second half will match the first half performance.
In the light of the performance recovery in the first half, we have decided to
resume payment of an interim dividend of 5.5p per share (2020: nil), the same
level as in 2019, which will be paid on 25 March 2022 to shareholders
registered as at 25 February 2022.
This announcement contains inside information for the purposes of the UK
Market Abuse Regulation and the Directors of the Company are responsible for
the release of this announcement.
Anthony Buttanshaw
Chair
11 November 2021
For further information, please contact:
Samuel Heath & Sons Plc
Simon Latham, Company Secretary
0121 766 4200
Cairn Financial Advisers LLP
James Caithie / Jo
Turner
020 7213 0880
Unaudited Interim Financial Report
For the Half Year ended 30 September 2021
CONSOLIDATED INCOME STATEMENT
Half year Half year Year
ended 30 ended 30 ended 31
September September March
2021 2020 2021
Unaudited Unaudited Audited
£'000 £'000 £'000
Revenue 6,904 4,850 11,539
Cost of sales (3,510) (3,062) (6,568)
Gross profit 3,394 1,788 4,971
Selling and distribution costs (1,510) (1,344) (2,469)
Administrative expenses (1,052) (940) (2,004)
Other operating income - grants (note 6) 16 596 625
Operating profit before exceptional items 848 100 1,123
Exceptional items - GMP equalisation - - (70)
Reorganisation - (230) (252)
Operating profit 848 (130) 801
Finance income 10 14 4
Finance cost (82) (108) (185)
Profit/(loss) before taxation 776 (224) 620
Taxation (125) 43 (227)
Profit/(loss) for the period 651 (181) 393
Basic and diluted earnings /(loss) per ordinary share (note 4) 25.7p (7.1p) 15.5p
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Half year ended 30 September Half year ended 30 September Year ended 31 March
2021 2020 2021
Unaudited Unaudited Audited
£'000 £'000 £'000
651 (181) 393
Profit/(loss) for the period
Items that will not be reclassified to profit or loss:
Actuarial (loss) on defined benefit pension scheme (316) (1,239) (542)
Deferred tax on actuarial loss 60 218 103
Deferred tax rate change 298 - -
42 (1,021) (439)
Total comprehensive income for the period 693 (1,202) (46)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
At 30 September At 30 September At 31 March
2021 2020 2021
Unaudited Unaudited Audited
£'000 £'000 £'000
Non-current assets
Intangible assets 191 135 186
Property, plant and equipment 3,345 3,541 3,413
Deferred tax assets 997 1,103 741
4,533 4,779 4,340
Current assets
Inventories 3,718 3,869 3,682
Trade and other receivables 2,113 1,689 2,108
Current tax receivable - - 25
Cash and cash equivalents 4,909 3,424 3,682
10,740 8,982 9,497
Total assets 15,273 13,761 13,837
Current liabilities
Trade and other payables (1,862) (1,772) (1,769)
Right of use lease liabilities (26) (53) (55)
Borrowings (note 7) (84) - -
Current tax payable (101) (36) -
(2,073) (1,861) (1,824)
Non-current liabilities
Right of use lease liabilities - (26) -
Borrowings (note 7) (866) - -
Retirement benefit scheme (6,198) (7,413) (6,396)
(7,064) (7,439) (6,396)
Total liabilities (9,137) (9,300) (8,220)
Net assets 6,136 4,461 5,617
Equity
Called up share capital 254 254 254
Capital redemption reserve 109 109 109
Revaluation reserve 1,225 1,308 1,267
Retained earnings 4,548 2,790 3,987
Equity shareholders' funds 6,136 4,461 5,617
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Attributable to owners of the Parent Company
Share capital Capital redemption reserve Revaluation reserve Retained earnings Total equity
£000 £000 £000 £000 £000
Balance at 31 March 2020 254 109 1,349 3,951 5,663
Total transactions with owners
Equity dividends paid - - - - -
Loss for the period - - - (181) (181)
Other comprehensive income for the period - - - (1,021) (1,021)
Reclassification of depreciation on revaluation
- - (41) 41 -
Total comprehensive income for the period - - (41) (1,161) (1,202)
Balance at 30 September 2020 254 109 1,308 2,790 4,461
Total transactions with owners
Equity dividends paid - - - - -
Profit for the period - - - 574 574
Other comprehensive income for the period - - - 582 582
Reclassification of depreciation on revaluation
- - (41) 41 -
Total comprehensive income for the period - - (41) 1,197 1,156
Balance at 31 March 2021 254 109 1,267 3,987 5,617
Total transactions with owners - - - (174) (174)
Equity dividends paid
Profit for the period - - - 651 651
Other comprehensive income for the period - - - 42 42
Reclassification of depreciation on revaluation
- - (42) 42 -
Total comprehensive income for the period - - (42) 735 693
Balance at 30 September 2021 254 109 1,225 4,548 6,136
CONSOLIDATED CASH FLOW
STATEMENT
Half year ended 30 September Half year ended 30 September Year ended 31 March
2021 2020 2021
Unaudited Unaudited Audited
£'000 £'000 £'000
Cash flow from operating activities
Profit/(loss) for the period before taxation 776 (224) 620
Adjustments for:
Depreciation 150 155 370
Amortisation 24 16 45
Loss/(profit) on disposal of property, plant and equipment 10 - (41)
Net finance costs/(income) (10) (14) 21
Defined benefit pension scheme expenses 106 98 280
Contributions to defined benefit pension scheme (518) (500) (1,000)
Operating cash flow before movements in working capital 538 (469) 295
Changes in working capital:
(Increase)/decrease in inventories (36) 361 548
(Increase)/decrease in trade and other receivables (33) 658 262
Increase/(decrease) in trade and other payables 124 (65) (65)
Cash generated from operations 593 485 1,040
Taxation paid - - (109)
Net cash from operating activities 593 485 931
Cash flow from investing activities
Payments to acquire property, plant and equipment (93) (61) (169)
Proceeds from the sale of property, plant and equipment - - 63
Payments to acquire intangible assets (29) - (79)
Net finance income/(costs) 10 14 (21)
Net cash outflow from investing activities (112) (47) (206)
Cash flow from financing activities
Payment for right of use assets (30) (30) (59)
Proceeds from new loans (note 7) 950 - -
Dividends paid (174) - -
Net cash outflow from financing activities 746 (30) (59)
Net increase in cash and cash equivalents 1,227 408 666
Cash and cash equivalents at beginning of period 3,682 3,016 3,016
Cash and cash equivalents at end of period 4,909 3,424 3,682
NOTES TO THE INTERIM FINANCIAL REPORT
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 2021 is not
audited and does not constitute statutory accounts as defined in section 434
of the Companies Act 2006. The statutory accounts for the year ended 31
March 2021 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 2020 were
also unaudited.
2. ACCOUNTING POLICIES
Basis of accounting
The report has been prepared on a going concern basis in accordance UK-adopted
International Accounting Standards.
The group has not availed itself of early adoption options in standards and
interpretations.
The principal accounting policies adopted are as set out in the Annual Report
for the year ended 31 March 2021. 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 2021 from the
movements in discount rates and inflation during the six months.
3. DIVIDENDS
A final dividend for the financial year 2021 of 6.875p per share (2020: 0.0p)
was paid during the period.
An Interim dividend for the financial year 2022 of 5.5p per share is proposed
(2021: 0.0p), payable on 25 March 2022.
4. EARNINGS/(LOSS) PER SHARE
The basic and diluted earnings per share are calculated by dividing the
relevant profit after taxation of £651,000 (2020: loss £181,000) by the
average number of ordinary shares in issue during the period being 2,534,322
(2020: 2,534,322). The number of shares used in the calculation is the same
for both basic and diluted earnings.
5. EXCEPTIONAL ITEMS
In November 2020, there was a further High Court ruling in relation to
guaranteed minimum pension benefits. The latest ruling states that trustees of
defined benefit schemes that provided guaranteed minimum payments should
revisit, and where necessary, top-up historic cash equivalent transfer values
that were calculated on an unequalised basis if an affected member makes a
successful claim. The impact of the ruling implies that pension scheme
trustees are responsible for equalising the guaranteed minimum payments for
members who transferred out of its defined benefit pension scheme. This has
resulted in an increase in the liabilities of the scheme of £70,000 for the
year ended 31 March 2021 (half years ended 30 September 2020 and 30 September
2021: £nil), which was recognised in the results as a past service cost in
exceptional items.
Included within exceptional costs are the costs of restructuring the business
to size itself better in the year ended 31 March 2021. Costs for exceptional
redundancy in the half year ended 30 September 2021 were £nil (year ended 31
March 2021: £252,000; half year ended 30 September 2020: £230,000).
NOTES TO THE INTERIM FINANCIAL REPORT (continued)
6. OTHER OPERATING INCOME - GRANT FUNDING
Income has been received from government grants
providing support during the Coronavirus pandemic:
Half year ended 30 September Half year ended 30 September Year ended 31 March
2021 2020 2021
Unaudited Unaudited Audited
£'000 £'000 £'000
Job Retention Scheme 16 571 600
Borough of Hammersmith & Fulham - 25 25
Total other operating income 16 596 625
Income has been accounted for under the accruals method.
7. BORROWINGS
At the end of April 2021, the Company drew down a loan under the Coronavirus
Business Interruption Loan Scheme (CBILS), for the value of £950,000, which
under the standard terms is interest free for 12 months, with no penalty for
early repayment.
Note:
Certain statements made in this announcement are forward-looking statements.
These forward-looking statements are not historical facts but rather are based
on the Company's current expectations, estimates, and projections about its
industry; its beliefs; and assumptions. Words such as 'anticipates,'
'expects,' 'intends,' 'plans,' 'believes,' 'seeks,' 'estimates,' and similar
expressions are intended to identify forward-looking statements. These
statements are not a guarantee of future performance and are subject to known
and unknown risks, uncertainties, and other factors, some of which are beyond
the Company's control, are difficult to predict, and could cause actual
results to differ materially from those expressed or forecasted in the
forward-looking statements. The Company cautions security holders and
prospective security holders not to place undue reliance on these
forward-looking statements, which reflect the view of the Company only as of
the date of this announcement. The forward-looking statements made in this
announcement relate only to events as of the date on which the statements are
made. The Company will not undertake any obligation to release publicly any
revisions or updates to these forward-looking statements to reflect events,
circumstances, or unanticipated events occurring after the date of this
announcement except as required by law or by any appropriate regulatory
authority.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END IR BUBDBUXBDGBBRecent news on Samuel Heath and Sons
See all newsREG - Heath(Samuel) & Sons - Half-year Report
AnnouncementREG - Heath(Samuel) & Sons - Result of AGM
AnnouncementREG - Heath(Samuel) & Sons - Final Results
AnnouncementREG - Heath(Samuel) & Sons - Director/PDMR Shareholding
AnnouncementREG - Heath(Samuel) & Sons - Holding(s) in Company
Announcement