TIDMHYC
RNS Number : 5821S
Hyder Consulting PLC
23 November 2011
Hyder Consulting PLC (HYC.L)
Half Year Results Announcement
Results for the half year ended 30 September 2011
Results in line; good visibility for second half
Hyder Consulting, the multi-national design and engineering
consultancy, today announces its financial results for the half
year ended 30 September 2011.
Highlights:
l Order book of GBP291m at 30 September 2011 (31 March 2011:
GBP312m)
l Significant new contract awards since the half year end
l Revenues of GBP139.3m (2010: GBP149.9m)
l Adjusted profit before tax* of GBP9.4m (2010: GBP10.6m)
l Profit before tax of GBP8.1m (2010: GBP9.5m)
l Adjusted diluted earnings per share* of 19.29p (2010:
21.80p)
l Interim dividend up 14% to 2.00p per share (2010: 1.75p)
l Net cash balances of GBP4.8m (2010: GBP5.3m)
l 82% of operating profit and 74% of revenue generated from
overseas
* Adjusted numbers exclude exceptional items and amortisation on
business combinations
Ivor Catto, Chief Executive, said: "Given the global economic
climate, I'm pleased to report that results are in line with plan.
We have targeted our clients and project opportunities carefully
and have recently won a number of important projects across each of
the regions, which gives us good forward visibility. Along with our
broad market spread and net cash position, this visibility gives us
confidence for the full year."
Contacts:
Hyder Consulting PLC Ivor Catto, Chief Executive Tel: +44 (0)20
7904 9011 Russell Down, Group Finance Director Tel: +44 (0)20 7904
9020
Citigate Dewe Rogerson Ginny Pulbrook Tel: +44 (0)20 7282
2945
There will be a results presentation for stockbroking analysts
today at 9.00am, to be held at Citigate Dewe Rogerson, 3 London
Wall Buildings, London Wall, EC2M 5SY
I am pleased to report our results are in line with plan, and
the increased recent order intake gives the board confidence that
this will be maintained in the second half.
Overview
Our order book was GBP291m at 30 September 2011 (31 March 2011:
GBP312m). Since then we have secured, or are preferred bidder on, a
number of substantial new contracts:
-- Titenbar to Ewingsdale; highway design, Australia
-- Southern Expressway, highway design, Australia
-- Alpha Coal construction camp, Australia
-- Sowwah Island, building design, Abu Dhabi
-- Al Khor Park, Lusail, Landscaping, Qatar
-- Lusail underground station, Qatar
-- Gas turbine power plant, Dammam, Saudi Arabia
-- Highways Agency motorway design and site assurance, UK
-- London Bridge station design, UK
Financial results
Revenue for the period was GBP139.3m (2010: GBP149.9m) and net
fees were GBP120.2m (2010: GBP130.1m).
Adjusted operating profit in the period was GBP9.1m (2010:
GBP10.6m); in the prior period performance bonuses on Australian
Alliance contracts had been recognised. In April, the defined
benefit Acer Group Pension Scheme (AGPS) was closed to future
accrual. The costs of the closure, along with due diligence costs
on acquisitions, have been treated as exceptional items (GBP0.5m).
Operating profit amounted to GBP7.8m (2010: GBP9.6m).
Net finance income amounted to GBP0.3m in the period (2010:
GBP0m) primarily as a result of increased finance income being
recognised on the pension scheme. Adjusted profit before tax was
GBP9.4m (2011: GBP10.6m).
The effective rate of tax was 21.2% (2010: 21.7%); and the
adjusted tax rate 20.3% (2010: 21.2%). Adjusted diluted earnings
per share were 19.29p (2010: 21.80p).
Headcount during the first half reduced slightly to 3,650;
redundancy costs of GBP1.0m (2010: GBP1.8m) were absorbed within
operating profits. Following the recent contract successes, we
anticipate a growth in staff numbers in the second half.
Dividend
The Board has declared a 14% increase in the interim dividend to
2.0p (2010: 1.75p) payable on 18 January 2012 to shareholders on
the register at 16 December 2011.
Funding
Net cash was GBP4.8m at 30 September 2011, compared to GBP5.3m
at 30 September 2010, and GBP13.1m at 31 March 2011. Cash utilised
in operations was GBP1.6m, after making contributions of GBP2.6m
towards the pension deficit, reflecting the seasonality of our cash
flows, and the changing mix of our Middle East business. We
experienced some delayed contract settlements in the Middle East
during the first half, though we have received substantial payments
after the period end.
At 30 September 2011 cash balances of GBP15.9m and unutilised
committed banking facilities of GBP38.0m provide headroom to fund
organic growth and acquisition opportunities.
Pension fund
The AGPS was closed to future benefit accrual on 30 April 2011
with active members transferring into a defined contribution
scheme.
The deficit in the AGPS and annuitants' schemes as reported
under IAS19 increased by GBP0.2m, net of deferred tax, to GBP14.2m.
Actuarial losses of GBP3.5m were recognised in the period as a
result of lower than expected asset returns and reduced discount
rates. During the half year, the group made cash contributions of
GBP2.7m of which annual contributions payable in the first half
were GBP1.4m.
Regional review
Asia Pacific
Revenue was GBP56.1m (2010: GBP59.4m), and operating profits
GBP6.9m (2010: GBP8.6m).
In Australia, results were below the same period last year, due
to Alliance performance bonuses having been recognised in the
comparative period. Following the Queensland flooding and state
elections earlier this year our order book reduced, but the
opportunity pipeline is increasing and we have recently won a place
on the substantial Titenbar to Ewingsdale contract. Hyder continues
to work on a number of highways-related Alliance contracts which
are performing well, and we are well positioned for new
opportunities in the rail market. In the utilities and resources
sectors we have secured new work and are investing in growing our
presence. In the property sector workload has been subdued.
In Asia, we have won a number of important new projects in China
and opened a new office in Chongqing to accommodate the growing
demand in this region. Profitability in Hong Kong has continued to
improve.
Middle East
Revenues were GBP31.6m (2010: GBP35.0m) and operating profits
GBP1.1m (2010: GBP1.4m). Hyder has invested in positioning itself
for some substantial opportunities in Saudi Arabia and also in
Qatar ahead of the 2022 World Cup. This has necessarily meant a
reduction in operating profit in the first half but we are now very
well placed to take advantage of these opportunities as they arise.
Project awards and contract settlements in the UAE have been slow
in the first half, though we received substantial payments after
the period end. We anticipate that recent contract awards will
result in an improved second half performance.
Europe
Revenues were GBP51.6m (2010: GBP55.5m) and operating profits
GBP2.9m (2010: GBP2.3m).
In the UK, our utilities business has performed well over the
half year, with a strong workload from AMP5 contracts and major
projects with Thames Water. In the transport sector, project awards
have been slower to come to fruition than anticipated. More
recently, under Hyder's framework contracts with the Highways
Agency, we have been awarded work on a number of motorway design
contracts, as well as further traffic management and site assurance
works. We have also won design works on London Bridge station and
further works with Crossrail.
In June we purchased the business and assets of ESR Technology
Ltd, a specialist engineering, safety and risk consultant which
operates in the oil, gas and utilities sectors in the UK and Abu
Dhabi. Subsequent to the acquisition, we injected GBP0.6m of
working capital into the business. The acquisition is integrating
well and performing in line with plan.
In Germany our results have improved significantly, benefiting
from the acquisition of Ingenieur Consult earlier in the year.
Outlook
Our revenues and profits are derived from five geographic
regions and four market sectors, giving Hyder diversity and
resilience. Though economic conditions remain challenging, we have
good visibility with a strong order book and pipeline of
opportunities. The Board remains confident of the full year outturn
and the longer term prospects are good.
I would again like to express the Board's appreciation to our
clients for their continued confidence in Hyder and to our staff
for their dedication and professionalism.
Sir Alan Thomas
Chairman
23 November 2011
Consolidated income statement for the six months ended 30
September 2011 (unaudited)
Six months Six months
ended 30 ended 30 Year ended
September September 31 March
2011 2010 2011
Note GBP'000 GBP'000 GBP'000
----------- ----------- -----------
Revenue 2 139,318 149,949 290,297
Net operating costs (131,525) (140,384) (272,141)
----------- ----------- -----------
Group operating profit 7,793 9,565 18,156
----------- ----------- -----------
Finance costs 3 (441) (464) (910)
Finance income 3 729 437 933
----------- ----------- -----------
Profit before taxation 8,081 9,538 18,179
----------- ----------- -----------
Analysed as:
Adjusted profit before taxation 9,362 10,582 20,326
Amortisation of business combination
intangible assets (808) (1,044) (2,147)
Exceptional items (473) - -
Profit before taxation 8,081 9,538 18,179
----------- ----------- -----------
Taxation (1,711) (2,073) (3,297)
----------- ----------- -----------
Profit attributable to equity holders
of the parent 6,370 7,465 14,882
=========== =========== ===========
Earnings per share (p)
Basic 4 16.83 19.73 39.29
Diluted 4 16.47 19.48 38.63
Adjusted basic 4 19.72 22.08 44.08
Adjusted diluted 4 19.29 21.80 43.34
--------------------------------------- ----- ----------- ----------- -----------
Consolidated statement of comprehensive income for the six
months ended 30 September 2011 (unaudited)
Six months Six months
ended 30 ended 30 Year ended
September September 31 March
2011 2010 2011
GBP'000 GBP'000 GBP'000
----------- ----------- -----------
Profit for the period 6,370 7,465 14,882
Other comprehensive (expense) / income
for the period
Foreign exchange movements (59) (2,424) (1,795)
Cash flow hedges (98) (60) 133
Actuarial (loss) / gain on post employment
benefit schemes (2,842) (2,301) 2,705
----------- ----------- -----------
Total other comprehensive (expense) /
income for the period (2,999) (4,785) 1,043
Total comprehensive income for the period
attributable to equity
shareholders 3,371 2,680 15,925
=========== =========== ===========
All balances are shown net of taxation.
Consolidated balance sheet at 30 September 2011 (unaudited)
As at 30 As at 30 As at 31
September September March
2011 2010 2011
Note GBP'000 GBP'000 GBP'000
---------- ---------- ---------
Assets
Non-current assets
Intangible assets 6 39,142 40,027 39,070
Property, plant and equipment 6 7,475 8,993 7,550
Deferred tax assets 10,544 11,195 10,079
---------- ---------- ---------
57,161 60,215 56,699
---------- ---------- ---------
Current assets
Trade and other receivables 118,977 113,772 111,747
Corporation tax recoverable 545 503 602
Cash and cash equivalents 8(b) 15,938 16,165 22,220
---------- ---------- ---------
135,460 130,440 134,569
---------- ---------- ---------
Liabilities
Current liabilities
Borrowings (2,743) (746) (1,469)
Trade and other payables (62,818) (65,546) (64,816)
Current tax liabilities (2,737) (4,415) (4,469)
Provisions 7 (3,939) (4,570) (4,201)
---------- ---------- ---------
(72,237) (75,277) (74,955)
---------- ---------- ---------
Net current assets 63,223 55,163 59,614
---------- ---------- ---------
Non-current liabilities
Borrowings (8,443) (10,105) (7,655)
Post employment benefits 10 (24,750) (33,382) (23,954)
Provisions 7 (394) (371) (619)
Deferred tax liabilities (900) (1,203) (731)
Other non-current liabilities (3,240) (1,839) (1,988)
---------- ---------- ---------
(37,727) (46,900) (34,947)
---------- ---------- ---------
Net assets 82,657 68,478 81,366
========== ========== =========
Equity
Called up ordinary share capital 3,862 3,845 3,854
Share premium 29,764 29,425 29,589
Retained earnings 38,218 24,713 36,606
Other reserves 10,813 10,495 11,317
Total shareholders' equity 82,657 68,478 81,366
========== ========== =========
Consolidated cash flow statement for the six months ended 30
September 2011 (unaudited)
Six months Six months
ended ended Year ended
30 30
September September 31 March
2011 2010 2011
Note GBP'000 GBP'000 GBP'000
----------- ----------- -----------
Cash flows from operating activities
Cash (used in) / generated from operations 8(a) (1,617) 5,964 19,164
Net finance costs (86) (126) (319)
Taxation paid (3,279) (1,862) (4,522)
----------- ----------- -----------
Net cash (used in) / generated from
operating activities (4,982) 3,976 14,323
----------- ----------- -----------
Cash flows from investing activities
Acquisition of subsidiaries (net of
cash acquired) 9 272 - (440)
Proceeds from disposal of property, plant
and equipment (incl. software) 102 77 229
Purchase of property, plant and equipment
(incl. software) (1,065) (871) (2,382)
----------- ----------- -----------
Net cash used in investing activities (691) (794) (2,593)
----------- ----------- -----------
Cash flows from financing activities
Proceeds on issue of shares 183 152 325
Employee trust purchase of own shares (361) (559) (559)
Repayments of obligations under finance
leases (515) (820) (995)
Net movement on borrowings 2,427 (5,324) (7,680)
Dividends paid 5 (2,270) (1,697) (2,358)
----------- ----------- -----------
Net cash used in financing activities (536) (8,248) (11,267)
----------- ----------- -----------
Net (decrease) / increase in cash and
cash equivalents (6,209) (5,066) 463
----------- ----------- -----------
Cash and cash equivalents at 1 April 22,220 21,399 21,399
Effects of exchange rate fluctuations (73) (168) 358
Cash and cash equivalents at 31 March 15,938 16,165 22,220
=========== =========== ===========
Reconciliation of net cash
Six months Six months
ended ended Year ended
30 30
September September 31 March
2011 2010 2011
Note GBP'000 GBP'000 GBP'000
----------- ----------- -----------
Net (decrease) / increase in cash and
cash equivalents (6,209) (5,066) 463
(Increase) / decrease in debt (2,085) 6,844 8,675
Effect of exchange rate changes (50) (97) 325
----------- ----------- -----------
Change in net cash during the period (8,344) 1,681 9,463
----------- ----------- -----------
Net cash at 1 April 13,096 3,633 3,633
----------- ----------- -----------
Net cash 8(b) 4,752 5,314 13,096
=========== =========== ===========
Consolidated statement of changes in equity for the six months
ended 30 September 2011 (unaudited)
Share Share Retained Other Total
capital premium earnings reserves
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------- --------- --------- ---------- ---------- --------
At 1 April 2010 3,837 29,281 21,059 13,442 67,619
New shares issued 8 - - - 8
Premium on new shares issued - 144 - - 144
Profit for the period - - 7,465 - 7,465
Dividends paid - - (1,697) - (1,697)
Actuarial loss on post employment
benefit schemes - - (2,301) - (2,301)
Share based payments - - 283 - 283
Cash flow hedges - - - (60) (60)
Employee trust purchase
of own shares - - - (559) (559)
Transfer of own shares
from EBT - - (96) 96 -
Foreign exchange movements - - - (2,424) (2,424)
--------- --------- ---------- ---------- --------
At 30 September 2010 3,845 29,425 24,713 10,495 68,478
New shares issued 9 - - - 9
Premium on new shares issued - 164 - - 164
Profit for the period - - 7,417 - 7,417
Dividends paid - - (661) - (661)
Actuarial gain on post employment
benefit schemes - - 5,006 - 5,006
Share based payments - - 131 - 131
Cash flow hedges - - - 193 193
Foreign exchange movements - - - 629 629
--------- --------- ---------- ---------- --------
At 31 March 2011 3,854 29,589 36,606 11,317 81,366
New shares issued 8 - - - 8
Premium on new shares issued - 175 - - 175
Profit for the period - - 6,370 - 6,370
Dividends paid - - (2,270) - (2,270)
Actuarial loss on post employment
benefit schemes - - (2,842) - (2,842)
Share based payments - - 368 - 368
Cash flow hedges - - - (98) (98)
Employee trust purchase
of own shares - - - (361) (361)
Transfer of own shares
from EBT - - (14) 14 -
Foreign exchange movements - - - (59) (59)
--------- --------- ---------- ---------- --------
At 30 September 2011 3,862 29,764 38,218 10,813 82,657
========= ========= ========== ========== ========
All balances are shown
net of taxation.
Notes to the Financial Statements
1. General information
(a) Basis of preparation
This condensed unaudited consolidated financial information for
the half year ended 30 September 2011 has been prepared in
accordance with the Disclosure and Transparency Rules of the
Financial Services Authority and with IAS 34, "Interim financial
reporting" as adopted by the European Union (EU). The half year
condensed consolidated financial report should be read in
conjunction with the annual financial statements for the year ended
31 March 2011, which have been prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by
the EU.
The condensed consolidated half yearly financial statements have
been prepared on a going concern basis under the historical cost
convention, as modified by the valuation of financial instruments
which are measured at fair value. The statements are prepared in
accordance with IFRS as adopted by the EU, and those parts of the
Companies Act 2006 related to reporting under IFRS. IFRS are
subject to amendment or interpretation by the International
Accounting Standards Board and there is an ongoing process of
review and endorsement by the EU. For these reasons, it is possible
that the information presented in this report may be subject to
change.
The preparation of financial statements in conformity with
generally accepted accounting principles requires the use of
estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reported
period. Although these estimates are based on management's best
knowledge of the amount, events or actions, actual results
ultimately may differ from those estimates.
The financial information does not constitute statutory accounts
within the meaning of section 434 of the Companies Act 2006. The
financial information relating to the year ended 31 March 2011 has
been delivered to the Registrar of Companies. The report of the
auditors on these accounts was unqualified.
(b) Principal accounting policies
The accounting policies adopted are consistent with those of the
annual financial statements for the year ended 31 March 2011, as
described in those financial statements.
The group's significant accounting policies under IFRS are
available on the corporate website www.hyderconsulting.com within
the "Investors" section.
(c) Principal risks and uncertainties
The group faces a number of risks which are regularly monitored
by the board. A structured risk management, internal control and
internal audit process seeks to provide a means of identifying,
evaluating and prioritising risk. However these systems can only
operate to mitigate risk rather than eliminate it completely. The
principal risks and uncertainties facing the group are as
follows:
-- Management of working capital, particularly in the Middle East;
-- Changes in market conditions;
-- Management of projects;
-- Contractual disputes and claims;
-- Recruitment, utilisation and retention of key staff;
-- Defined benefit pension schemes;
-- Integrity and sustainability of IT systems;
-- Health and safety;
-- Foreign exchange movements.
2. Segmental analysis by location of operations
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision maker.
The chief operating decision maker, who is responsible for
allocating resources and assessing performance of the operating
segments, has been identified as the board that makes strategic
decisions.
Reflecting the group's management and internal reporting
structure, primary segmental information is presented within the
financial statements in respect of geographical segments. The group
manages its business on an international basis with operations in
three main geographical regions, Asia-Pacific, the Middle East, and
Europe. The UK is the home country of the parent. Inter-segment
revenue relates to contracts priced on an arm's length basis.
The group's revenue is derived from the provision of engineering
consultancy services.
(a) Segment revenue
Six months Six months
Inter- ended ended Year
segment 30 30 ended
revenue September September 31 March
2011 2011 2011 2010 2011
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------- --------- ----------- ----------- ----------
Australia 45,676 (532) 45,144 47,586 91,764
Asia 11,160 (173) 10,987 11,830 22,255
--------- --------- ----------- ----------- ----------
Asia-Pacific 56,836 (705) 56,131 59,416 114,019
Middle East 33,018 (1,466) 31,552 35,014 65,487
UK 38,545 (410) 38,135 44,166 87,195
Germany 13,500 - 13,500 11,353 23,596
--------- --------- ----------- ----------- ----------
Europe 52,045 (410) 51,635 55,519 110,791
141,899 (2,581) 139,318 149,949 290,297
========= ========= =========== =========== ==========
(b) Segment results
Australia 6,189 8,285 13,912
Asia 662 364 547
-------- -------- --------
Asia-Pacific 6,851 8,649 14,459
Middle East 1,064 1,352 2,605
UK 1,909 1,870 5,460
Germany 950 444 1,105
-------- -------- --------
Europe 2,859 2,314 6,565
Corporate overheads (1,700) (1,706) (3,326)
Group adjusted operating
profit 9,074 10,609 20,303
Amortisation on business
combinations (808) (1,044) (2,147)
Exceptional items (473) - -
-------- -------- --------
Group operating profit 7,793 9,565 18,156
======== ======== ========
Exceptional items comprise GBP324,000 in respect of acquisition
costs; and GBP149,000 in respect of legal costs, settlements, and
curtailments for the closure of the AGPS pension scheme to future
accrual.
(c) Total assets
As at As at As at
30 30 31
September September March
2011 2010 2011
GBP'000 GBP'000 GBP'000
---------- ---------- --------
Australia 36,999 35,161 40,718
Asia 19,253 17,475 18,249
---------- ---------- --------
Asia-Pacific 56,252 52,636 58,967
Middle East 59,300 58,441 55,459
UK 47,309 53,199 46,512
Germany 29,760 26,379 30,330
---------- ---------- --------
Europe 77,069 79,578 76,842
192,621 190,655 191,268
========== ========== ========
3. Net finance income
Six months Six months
ended 30 ended 30 Year ended
September September 31 March
2011 2010 2011
GBP'000 GBP'000 GBP'000
----------- ----------- -----------
Bank borrowings (250) (200) (463)
Finance leases (70) (33) (89)
Interest rate financial instruments (79) (121) (234)
Unwinding of discounts (42) (110) (124)
----------- ----------- -----------
Finance costs (441) (464) (910)
----------- ----------- -----------
Investment income 180 228 467
Interest received on settlement of 133 - -
contracts
Net finance income on post employment
benefit schemes 416 209 466
----------- ----------- -----------
Finance income 729 437 933
----------- ----------- -----------
Net finance income / (cost) 288 (27) 23
=========== =========== ===========
4. Earnings per share
(a) Number of shares
Six months Six months
ended ended Year ended
30 30
September September 31 March
2011 2010 2011
----------- ----------- -----------
Weighted average number of shares
in issue 37,846,155 37,830,356 37,876,301
Effect of dilution
Share options 836,987 494,844 645,467
Weighted average shares (diluted) 38,683,142 38,325,200 38,521,768
=========== =========== ===========
In the current financial year, vested executive share options
have been treated as potentially issuable shares and included
within the calculation of diluted earnings per share, to the extent
that they are 'in the money'. In the prior half year these shares
were included within the calculation of basic earnings per share,
and consequently the comparative September 2010 numbers have been
restated to reflect this change.
(b) Earnings used in the calculation of earnings per share
Six months Six months
ended ended Year ended
30 30
September September 31 March
2011 2010 2011
GBP'000 GBP'000 GBP'000
----------- ----------- -----------
Profit attributable to equity shareholders 6,370 7,465 14,882
Add back amortisation of intangible
assets on business combinations 808 1,044 2,147
Add back exceptional items 473 - -
Less tax on adjusted items (189) (155) (333)
----------- ----------- -----------
Adjusted earnings 7,462 8,354 16,696
=========== =========== ===========
(c) Earnings per share
Six months Six months
ended ended Year ended
30 30
September September 31 March
2011 2010 2011
p p p
----------- ----------- -----------
Basic earnings per share 16.83 19.73 39.29
Add back amortisation of intangible
assets on business combinations 2.13 2.76 5.67
Add back exceptional items 1.25 - -
Add back tax on adjusted items (0.49) (0.41) (0.88)
----------- ----------- -----------
Adjusted basic earnings per share 19.72 22.08 44.08
=========== =========== ===========
Six months Six months
ended ended Year ended
30 30
September September 31 March
2011 2010 2011
p p p
----------- ----------- -----------
Diluted earnings per share 16.47 19.48 38.63
Add back amortisation of intangible
assets on business combinations 2.09 2.72 5.57
Add back exceptional items 1.22 - -
Add back tax on adjusted items (0.49) (0.40) (0.86)
----------- ----------- -----------
Adjusted basic earnings per share 19.29 21.80 43.34
=========== =========== ===========
5. Dividends
Six months Six months
ended 30 ended 30 Year ended
September September 31 March
2011 2010 2011
GBP'000 GBP'000 GBP'000
----------- ----------- -----------
Dividends charged to equity in the
period 2,270 1,697 2,358
=========== =========== ===========
Equity - Per Ordinary 10p share
Final dividend paid (p) 6.00 4.50 4.50
Interim dividend paid (p) - - 1.75
The directors are proposing an interim dividend of 2.00p per
share (2010: 1.75p). This will be paid on 18 January 2012 to
shareholders on the register as at 16 December 2011.
6. Property, plant and equipment and Intangible assets
Intangible Property,
plant
assets and equipment
Net book value GBP'000 GBP'000
----------- --------------
At 1 April 2010 42,231 10,456
Exchange adjustments (707) (125)
Additions 410 461
Disposals - (34)
Depreciation and amortisation (1,907) (1,765)
----------- --------------
At 30 September 2010 40,027 8,993
Exchange adjustments 298 184
Additions - separately acquired 667 844
Additions - business combinations 617 98
Disposals (14) (861)
Amendments to fair value of consideration (530) -
Depreciation and amortisation (1,995) (1,708)
----------- --------------
At 31 March 2011 39,070 7,550
Exchange adjustments (94) (126)
Additions - separately acquired 341 1,114
Additions - business combinations 1,514 726
Disposals - (113)
Depreciation and amortisation (1,689) (1,676)
----------- --------------
At 30 September 2011 39,142 7,475
=========== ==============
7. Provisions
Professional
indemnity
insurance Vacant property Total
GBP'000 GBP'000 GBP'000
------------- ---------------- --------
At 1 April 2011 3,484 1,336 4,820
Exchange adjustments 4 (10) (6)
Charged to the income
statement - 114 114
Utilised / released to the income
statement (285) (352) (637)
Unwinding of discount - 42 42
------------- ---------------- --------
At 30 September 2011 3,203 1,130 4,333
============= ================ ========
At 30 September 2011
Current liabilities 3,203 736 3,939
Non-current liabilities - 394 394
------------- ---------------- --------
3,203 1,130 4,333
============= ================ ========
At 30 September 2010
Current liabilities 3,702 868 4,570
Non-current liabilities - 371 371
------------- ---------------- --------
3,702 1,239 4,941
============= ================ ========
At 31 March 2011
Current liabilities 3,484 717 4,201
Non-current liabilities - 619 619
------------- ---------------- --------
3,484 1,336 4,820
============= ================ ========
Professional indemnity insurance
The provision reflects management's estimate of the likely cost
of claims including professional indemnity insurance excesses and
has been provided in accordance with group policy. These provisions
will be carried forward until the claims to which they relate are
agreed and amounts utilised or released as appropriate.
Vacant property
The provision represents the estimated net present value of
future rentals where properties are vacant. These provisions will
be utilised up until such time as the vacant properties are re-let
(when the requirement for a provision will be reassessed), or the
lease terminates, whichever occurs earlier.
8. Notes to the consolidated cash flow statement
(a) Cash flows from operations
Six months Six months
ended ended Year ended
30 30
September September 31 March
2011 2010 2011
GBP'000 GBP'000 GBP'000
----------- ----------- -----------
Profit for the financial
period 6,370 7,465 14,882
Adjustments for:
Taxation 1,711 2,073 3,297
Depreciation 1,676 1,765 3,473
Amortisation - Software 881 863 1,755
Amortisation - Business combinations 808 1,044 2,147
Exceptional items 473 - -
Interest receivable (729) (437) (933)
Interest payable and similar
charges 441 464 910
----------- ----------- -----------
EBITDA 11,631 13,237 25,531
Loss on disposal of property, plant
and equipment 11 (43) 680
Fair value gain on financial
instruments (10) (41) (19)
Share option costs 368 283 414
Decrease in provisions (487) (799) (920)
Decrease in post employment benefits (96) (140) (829)
Deficit contributions to defined benefit
pension scheme (2,590) (2,184) (3,099)
Changes in working
capital:
(Increase) / decrease in trade and
other receivables (6,238) 2,089 6,531
Decrease in trade and other
payables (4,206) (6,438) (9,125)
----------- ----------- -----------
Cash (used) / generated from
operations (1,617) 5,964 19,164
=========== =========== ===========
(b) Reconciliation of movement in net cash
At 30 At 1 At 30
September April Cash Non-cash Exchange September
2010 2011 flow movement movement 2011
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------- -------- -------- --------- --------- ----------
Cash at bank 16,165 22,220 (6,209) - (73) 15,938
---------- -------- -------- --------- --------- ----------
Debt due within 1
year (457) (887) (1,333) (40) (1) (2,261)
Debt due after 1 year (9,882) (7,100) (1,094) 40 - (8,154)
Finance leases due
within 1 year (289) (582) 515 (421) 6 (482)
Finance leases due
after 1 year (223) (555) - 248 18 (289)
---------- -------- -------- --------- --------- ----------
(10,851) (9,124) (1,912) (173) 23 (11,186)
---------- -------- -------- --------- --------- ----------
5,314 13,096 (8,121) (173) (50) 4,752
========== ======== ======== ========= ========= ==========
The cash at bank balance includes GBP3.8m (September 2010:
GBP2.5m, March 2011: GBP2.5m) that is restricted and not available
to the group for general use.
Net non-cash movements comprise GBP173,000 of finance leases
acquired with ESR Technology Ltd.
9. Acquisitions
The group purchased ESR Technology Ltd during the year for total
consideration of GBP1. The purchase has been accounted for as a
business combination. Had this acquisition been completed on the
first day of the financial year group revenues for the half year
would have been GBP140.9m and the group adjusted operating profit
would have been GBP8.9m.
Date of Location Percentage
acquisition of operation of
equity acquired
-------------- --------------- -----------------
23 June
ESR Technology Limited 2011 UK 100%
The acquisition has contributed the following revenue and
adjusted operating profit:
Revenue Adjusted
operating
profit
GBP'000 GBP'000
-------- -----------
ESR Technology Limited 1,752 (174)
Details of the provisional fair value of assets and liabilities,
goodwill and intangible assets are as follows:
Fair value
ESR adjustment Total
GBP'000 GBP'000 GBP'000
-------- ----------- --------
Property plant and equipment 772 (46) 726
Intangible assets 10 1,164 1,174
Corporation tax recoverable 3 - 3
Trade and other receivables 2,082 - 2,082
Payments in advance on
contracts (1,044) (47) (1,091)
Deferred taxation - (303) (303)
Cash and cash equivalents 272 - 272
Trade and other payables (2,273) (757) (3,030)
Borrowings (173) - (173)
-------- ----------- --------
Net liabilities acquired (351) 11 (340)
Goodwill 340
--------
-
========
Consideration
Cash consideration -
--------
Gross consideration -
========
The cash flows arising from acquisitions are as follows:
GBP'000
--------
Cash consideration -
Cash acquired (272)
--------
Net cash inflow (272)
========
Fair value adjustments comprise a write down in the value of
property, plant and equipment; the recognition of intangible assets
related to contracts and customer relationships acquired; the
application of our revenue recognition policy; a deferred tax
liability in respect of the intangible assets; and an increase in
the accrual for dilapidations in respect of leased properties.
10. Post employment benefits
Employees of the group participate in a number of pension
schemes both in the UK and overseas. The principal scheme in the UK
is the Acer Group Pension Scheme (AGPS) which is a defined benefit
scheme. The group's net liabilities in respect of post employment
benefits comprise the following:
As at 30 As at 30 As at 31
September September March
2011 2010 2011
GBP'000 GBP'000 GBP'000
---------- ---------- ---------
AGPS and unfunded annuitants
scheme 18,277 26,657 17,994
Overseas schemes 6,473 6,725 5,960
---------- ---------- ---------
24,750 33,382 23,954
========== ========== =========
AGPS and annuitants scheme
A reconciliation of the amounts included in the consolidated
balance sheet for the AGPS and Annuitants scheme is as follows:
As at 30 As at 30 As at 31
September September March
2011 2010 2011
GBP'000 GBP'000 GBP'000
---------- ---------- ---------
At 1 April (17,994) (26,487) (26,487)
Current service costs (112) (778) (1,500)
Past service costs (521) - -
Notional interest on pension
liability (3,569) (3,526) (7,108)
Expected return on plan
assets 4,110 3,744 7,595
Contributions by employers 2,702 2,962 4,599
Curtailments 576 - -
Actuarial (losses) / gains
due to:
- Assets (2,374) 3,289 4,965
- Liabilities (1,095) (5,861) (58)
---------- ---------- ---------
Deficit in AGPS and Annuitants
scheme (18,277) (26,657) (17,994)
---------- ---------- ---------
Related deferred tax asset 4,064 5,502 3,998
---------- ---------- ---------
Net pension deficit (14,213) (21,155) (13,996)
========== ========== =========
As at 30 As at 30 As at 31
September September March
The key assumptions used 2011 2010 2011
were:
----------- ----------- -----------
Long-term rate of return:
- Equities 8.15% 8.30% 8.15%
- Bonds 5.35% 5.50% 5.35%
- Other assets 0.50% 0.50% 0.50%
Rate of increase in salaries n/a 3.30% 3.20%
Rate of increase to pensions
in payment:
- Index linked pensions with max 3% per
annum increases 2.40% 2.45% 2.55%
- Other index linked pension 3.05% 3.15% 3.40%
Discount rate 5.10% 5.00% 5.50%
Inflation assumptions
(RPI) 3.20% 3.30% 3.60%
Inflation assumptions
(CPI) 2.60% n/a 3.00%
Longevity at age 65 for
current pensioners
- Men 23.4 years 22.1 years 23.3 years
- Women 25.4 years 24.0 years 25.3 years
Longevity at age 65 for
future pensioners
- Men 25.5 years 24.0 years 25.4 years
- Women 27.3 years 25.9 years 27.2 years
The AGPS was closed to future benefit accrual on 30 April
2011.
11. Contingent liabilities
The group maintains professional indemnity insurance against
claims for professional negligence which in the ordinary course of
business have been, or may in the future be, received. The
directors assess each claim and make provision for legal and
settlement costs where, on the basis of advice received, it is
considered that a liability may exist.
Hyder Consulting PLC and various group companies have entered
into performance guarantees and performance bonds supporting
project requirements and certain other bonds and guarantees in the
ordinary course of business. The group's liabilities under
performance guarantees are only limited to the extent of the
underlying contracts. The directors do not consider any provision
is necessary in respect of guarantees and bonds.
12. Going concern
After making enquiries, the directors have a reasonable
expectation that the company and the group have adequate resources
to continue in operational existence for the foreseeable future and
therefore continue to adopt the going concern basis in preparing
the financial statements.
13. Statement of directors' responsibilities
This half year report is the responsibility of, and has been
approved by the directors. The directors confirm that to the best
of their knowledge: (i) this condensed set of financial statements
has been prepared in accordance with IAS 34 as adopted by the
European Union; and (ii) the interim management report herein
includes a fair review of the information required by DTR 4.2.7 and
DTR 4.2.8.
The directors are responsible for the maintenance and integrity
of the corporate and financial information included on the
Company's website. Legislation in the United Kingdom governing the
preparation and dissemination of financial statements may differ
from legislation in other jurisdictions.
The directors are listed in the annual report for the year ended
31 March 2011. A list of current directors is maintained on the
Company's website: www.hyderconsulting.com.
14. Cautionary statement
This half yearly financial report has been prepared solely for
the Company's members, as a body. The report may contain certain
forward-looking statements with respect to the financial condition,
performance, results, strategy and objectives, operations and
businesses of the group. By their nature these statements involve
uncertainty because they relate to future events and circumstances
which are beyond the group's control. As a result the group's
actual future financial condition, performance and results may
differ materially from the plans or expectations in any
forward-looking statement. The Company assumes no obligation to
update or revise any forward-looking statement, resulting from new
information, future events or otherwise. Nothing in this half year
report should be construed as a profit forecast.
15. Further information
An electronic version of this half yearly financial report and
31 March 2011 financial statements can be viewed on the Company's
website: www.hyderconsulting.com.
Independent review report to Hyder Consulting PLC
Introduction
We have been engaged by the company to review the condensed set
of financial statements in the half-yearly financial report for the
six months ended 30 September 2011, which comprises the
consolidated income statement, the consolidated statement of
comprehensive income , the consolidated balance sheet, the
consolidated cash flow statement, the consolidated statement of
changes in equity and related notes. We have read the other
information contained in the half-yearly financial report and
considered whether it contains any apparent misstatements or
material inconsistencies with the information in the condensed set
of financial statements.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and
has been approved by, the directors. The directors are responsible
for preparing the half-yearly financial report in accordance with
the Disclosure and Transparency Rules of the United Kingdom's
Financial Services Authority.
As disclosed in note 1, the annual financial statements of the
group are prepared in accordance with IFRSs as adopted by the
European Union. The condensed set of financial statements included
in this half-yearly financial report has been prepared in
accordance with International Accounting Standard 34, "Interim
Financial Reporting", as adopted by the European Union.
Our responsibility
Our responsibility is to express to the company a conclusion on
the condensed set of financial statements in the half-yearly
financial report based on our review. This report, including the
conclusion, has been prepared for and only for the company for the
purpose of the Disclosure and Transparency Rules of the Financial
Services Authority and for no other purpose. We do not, in
producing this report, accept or assume responsibility for any
other purpose or to any other person to whom this report is shown
or into whose hands it may come save where expressly agreed by our
prior consent in writing.
Scope of review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, 'Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity' issued by the Auditing Practices Board for use in
the United Kingdom. A review of interim financial information
consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other
review procedures. A review is substantially less in scope than an
audit conducted in accordance with International Standards on
Auditing (UK and Ireland) and consequently does not enable us to
obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do
not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 30
September 2011 is not prepared, in all material respects, in
accordance with International Accounting Standard 34 as adopted by
the European Union and the Disclosure and Transparency Rules of the
United Kingdom's Financial Services Authority.
PricewaterhouseCoopers LLP
Chartered Accountants
London
23 November 2011
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR GMMZMNZGGMZM
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