RNS Number:6617R
Miller Fisher Group PLC
28 September 2000
Miller Fisher Group plc
Interim results for the six months to 30 June 2000
Miller Fisher Group, provider of administration and support
services to the insurance and financial services industries,
announces its interim results for the half year to 30 June
2000.
Key points:
* New contract wins including Congregational and General
Insurance, Alliance and Leicester, Nationwide Building
Society and Fortis Insurance
* Extended contract wins including Lloyds TSB and the
CGNU
* Pre-tax pre-exceptional loss of #0.9 million (1999:
#2.7 million profit)
* Restructuring of firm and cuts in cost base leading to
exceptional costs of #0.65 million (1999: #0.25 million)
* Pre-tax loss of #1.5 million (1999: #2.4 million
profit)
* Dividend per share of 0.10p (1999: 0.30p)
* Further growth for Miller International, Miller
Firstline, Miller Farrell and Homecare Insurance
* Benefits of restructuring expected to come through by
end of year
On outlook, Chairman, Sir Timothy Kitson stated: "It has
been a difficult and disappointing first half to 2000. The
progress we have made in a number of parts of the group has
been overshadowed by the downturn we have seen in the UK
loss adjusting market. We do not anticipate that market to
improve until the latter part of the year. We have taken
firm action to reduce costs and improve productivity in our
loss adjusting division which we expect will return to
profitability before the end of the year. We also expect the
rest of the Group as a whole to continue the strong progress
made in the first half.
The Board regards the need to maximise shareholder value as
a key priority. We are currently examining a number of ways
by which this may be achieved."
For further information, contact:
Miller Fisher Group plc 020 7398 8700
Kevin Kenny - Chief Executive
Richard Horton - Finance Director
Grandfield 020 7417 4170
Clare Abbot/Kirsty Black
MILLER FISHER GROUP PLC
INTERIM RESULTS
FOR THE HALF YEAR TO 30 JUNE 2000
CHAIRMAN'S STATEMENT
The Board of Miller Fisher Group plc announces the interim
results for the six-month period to 30 June 2000.
Results
The group reported an overall loss before taxation and
exceptional items of #0.9 million compared to a profit of
#2.7 million for the corresponding period in the previous
year. At the operating level a small loss of #80,000 was
recorded compared to a profit of #3.1 million in the first
six months of 1999.
Exceptional items in the period amounted to #0.65 million
(1999: #0.25 million) and relate to redundancy and office
closure costs. Losses before tax after exceptional items
were #1.5 million (1999: #2.4 million profit). After a tax
credit of #0.49 million (1999: #0.65 million tax charge),
the loss after tax amounted to #1.1 million compared to
#1.78 million profit in 1999.
Earnings
Earnings per share before exceptional items showed a loss of
0.37p (1999: 1.29p profit) and after exceptional items
showed a loss of 0.65p (1999: 1.18p profit).
Turnover
Turnover for the Group was #29.6 million (1999: #29.6
million). Within this figure, the combined turnover of our
Claims Administration, Inspection and Investigation services
decreased marginally to #24.2 million from #24.7 million and
the turnover of our insurance subsidiary Homecare increased
to #5.4 million from #4.9 million the previous year.
Dividend
In view of the reduced profitability an interim dividend of
0.10p is being declared compared to 0.30p in the previous
year. The dividend will be paid on 8 December 2000 to
shareholders on the register at the close of business on 10
November 2000.
OVERVIEW
As we set out in our trading statement of 5 July 2000,
revenues from our UK loss adjusting business for the first
six months fell materially short of the levels expected by
the Board. This has been brought about by a decline in
claims activity in the household market across the UK as a
whole and has been a common experience for most of the other
loss adjusting firms in the market.
Part of the reason for the decline in claim numbers relates
to a reduction in the traditional weather related claims at
the beginning of the year as a result of the mild winter. In
addition the ongoing consolidation of the insurance sector
as a whole has seen a short-term reduction in the number of
claims outsourced to loss adjusters.
The management of the Group has taken firm action to cut the
cost base of the UK loss adjusting division to bring it into
line with the current levels of revenue. The exceptional
costs of this action, which comprised redundancy and office
closure costs, amounted to #0.65 million.
In addition, we are accelerating our planned re-engineering
of this division to increase levels of productivity. This
includes fast-tracking the introduction of new technology,
including web based applications, so as to increase our
capacity to handle a greater number of claims from a much
lower cost base.
In a difficult and competitive market, we have had a number
of successful contract wins such as Congregational and
General Insurance, Fortis Insurance and the extension of our
position with Lloyds TSB and the CGNU. We have not lost any
adjusting contracts in the period.
We launched CATLink, our internet based claims notification,
reporting and management system for commercial clients. This
has got off to a very promising start and we now have six
major insurers, five large brokers and one hundred corporate
clients trading via CATLink.
Good progress has been made in other parts of the Group.
Miller Firstline, our third party claims administration
business, won a number of major contracts with clients
including Alliance and Leicester, Nationwide Building
Society, Hastings Direct, CWS and others. Miller
International secured further significant nominations
through Swiss Re, Munich Re and other major reinsurers.
Miller Farrell expanded its activities in Ireland with the
acquisition of the liability adjusting business of Brian
Collins and Partners.
OPERATIONS
Claims Services and Administration
This division includes loss adjusting, claims administration
and related services as well third party administration and
outsourcing services. Since the beginning of the year, our
investigation service of potentially fraudulent motor
accident claims has been integrated into this division.
While UK loss adjusting activities have had a difficult
start to the year, elsewhere we have made good progress.
Miller International has shown further growth in
profitability. In Ireland, Miller Farrell consolidated its
pre-eminent position in the market, with the benefit of its
acquisition of the business of travel claims handler Francis
Charlsey at the end of 1999, now showing through. Miller
Firstline, our third party claims administration business
saw further revenue growth and was particularly successful
in winning a number of administration contracts, the
benefits of which will flow into the second half.
Inspection Services
Our inspection services of accident damaged motor vehicles
had an excellent start to the year, but this was marred by
the collapse of a major client, Motor and Legal Group Ltd at
the end of the first quarter. Although we suffered no
financial impact, this will have an effect on the inspection
services results for the year, since it will take some time
for the revenues from new clients gained during the year to
replace the lost income.
Insurance
Homecare Insurance, which specialises in the area of mobile
telephone insurance, expanded its growth in turnover,
profits and policy numbers. This growth is continuing and
is a reflection of the market in which it operates. We are
currently looking at ways in which we can maximise the value
of our investment in Homecare.
OUTLOOK
It has been a difficult and disappointing first half to
2000. The progress we have made in a number of parts of the
group has been overshadowed by the downturn we have seen in
the UK loss adjusting market. We do not anticipate that
market to improve until the latter part of the year. We have
taken firm action to reduce costs and improve productivity
in our loss adjusting division which we expect will return
to profitability before the end of the year. We also expect
the rest of the Group as a whole to continue the strong
progress made in the first half.
The Board regards the need to maximise shareholder value as
a key priority. We are currently examining a number of ways
by which this may be achieved.
Sir Timothy Kitson
Chairman
Miller Fisher Group plc
Unaudited Consolidated Profit and Loss Account
for the six months ended 30 June 2000
restated
Unaudited unaudited audited
six months six months to year to
30-Jun-2000 30-Jun-1999 31-Dec-1999
Note #000 #000 #000
Turnover 2 29,574 29,635 60,834
______ ______ ______
Operating (loss)/profit (80) 3,107 6,306
Net interest payable (820) (434) (1,078)
______ ______ ______
(Loss)/profit before taxation
and exceptional expenses (900) 2,673 5,228
Exceptional expenses 3 (648) (248) (2,624)
______ ______ ______
(Loss)/profit on ordinary
activities before taxation (1,548) 2,425 2,604
Taxation on profit on
ordinary activities 499 (650) (269)
______ ______ ______
(Loss)/profit on ordinary
activities after taxation (1,049) 1,775 2,335
Proposed dividend 4 (164) (474) (1,611)
______ ______ ______
Retained (loss)/profit
for the period (1,213) 1,301 724
______ ______ ______
(Loss)/earnings per ordinary
share (pence)
Before exceptional expenses 5 (0.37) 1.29 2.72
______ ______ ______
After exceptional expenses 5 (0.65) 1.18 1.51
______ ______ ______
Diluted (loss)/earnings per
share (pence)
Before exceptional expenses 5 (0.36) 1.21 2.66
______ ______ ______
After exceptional expenses 5 (0.63) 1.10 1.48
______ ______ ______
Dividends per ordinary
share (pence) 0.10 0.30 1.00
______ ______ ______
The profit for the period ended 30 June 1999 has been
restated as explained in note 1.
Miller Fisher Group plc
Unaudited Consolidated Balance Sheet
as at 30 June 2000
restated
unaudited unaudited audited
note 30-Jun-2000 30-Jun-1999 31-Dec-1999
#000 #000 #000
Fixed assets:
Intangible fixed assets 31,084 28,346 30,575
Tangible fixed assets 5,403 4,242 4,874
______ ______ ______
36,487 32,588 35,449
______ ______ ______
Current assets 6 32,202 31,516 33,077
Creditors: due
within one year 7 (34,603) (21,647) (27,563)
______ ______ ______
Net current
(liabilities)/assets (2,401) 9,869 5,514
______ ______ ______
Total assets less
current liabilities 34,086 42,457 40,963
Creditors: due after
one year 8 (8,916) (15,850) (14,663)
______ ______ ______
Net assets 25,170 26,607 26,300
______ ______ ______
Share capital 8,050 7,924 8,028
Share premium 257 0 142
Other reserves 16,462 16,529 16,516
Profit and loss account 401 2,154 1,614
______ ______ ______
Shareholders' funds
- equity interest 25,170 26,607 26,300
______ ______ ______
The balance sheet as at 30 June 1999 has been restated as
explained in note 1.
Miller Fisher Group plc
Unaudited Consolidated Cash Flow Statement
for the six months ended 30 June 2000
unaudited unaudited audited
Note six months to six months to year to
30-Jun-2000 30-Jun-1999 31-Dec-1999
#000 #000 #000
Net cash flow from
operating activities 10 (2,247) (171) 291
Returns on investments
and servicing
of finance (820) (462) (1,078)
Taxation paid (471) (1,022) (874)
Capital expenditure (1,192) (680) (1,798)
Acquisitions and disposals (235) (7,191) (8,262)
Equity dividends paid 0 0 (1,428)
______ ______ ______
Cash flow before use of
liquid resources and financing (4,965) (9,526) (13,149)
Financing 3,773 8,013 12,453
______ ______ ______
(Decrease) in cash for the period (1,192) (1,513) (696)
______ ______ ______
Reconciliation of cash flow to
movement in net debt:
(Decrease) in cash
for the period (1,192) (1,513) (696)
Effect of change in debt
and lease financing (3,773) (3,106) (7,539)
______ ______ ______
Change in net debt arising
from cash flows (4,965) (4,619) (8,235)
Opening net debt (17,240) (9,005) (9,005)
______ ______ ______
Closing net debt (22,205) (13,624) (17,240)
______ ______ ______
Miller Fisher Group plc
Notes to the Unaudited Consolidated Interim Results
for the six months ended 30 June 2000
1. Basis of accounting
The Interim Results have been prepared in accordance with the
accounting policies of Miller Fisher Group plc as set out in
its 1999 Report and Financial Statements.
A reassessment of the estimated useful life of goodwill was
undertaken in 1999 with the result that the directors consider the
estimated useful life of goodwill to be indefinite. Accordingly, goodwill
is not amortised but is subject to an annual review for impairment.
The results for the 30th June have been restated for the effect of
this reassessment, which is to reduce the charge for amortisation by
#683,000
2. Turnover 30-Jun-00 30-Jun-99 31-Dec-99
#000 #000 #000
Turnover includes insurance
premiums receivable of 5,356 4,900 10,259
______ ______ ______
3. Exceptional expenses
Exceptional expenses comprise:
Redundancy and reorganisation 648 248 1,600
Office relocation and temporary staff 518
International start up expenses 246
Change of domicile expenses 260
______ ______ ______
648 248 2,624
______ ______ ______
4. Dividend
The Board has declared an Interim Dividend of 0.1 pence per share
(1999 - 0.30 pence) payable on 8 December 2000 to shareholders on
the register at the close of business on 10 November 2000.
5. (Loss)/earnings per ordinary share
The (loss) (1999 - earnings) per ordinary share has been
calculated as follows:
30-Jun-00 30-Jun-99 31-Dec-99
#000 #000 #000
(Loss)/profit attributable to
ordinary shareholders:
Before exceptional expenses (595) 1,946 4,209
After exceptional expenses (1,049) 1,775 2,335
______ ______ ______
Weighted average number of
shares in issue 160,682,495 150,298,305 155,019,026
Adjusted weighted average
number of shares in issue 165,998,846 161,245,078 158,309,396
__________ __________ __________
The adjusted weighted average number of shares used for the
calculation of diluted earnings per share includes the estimated
dilutive impact of share options issued pursuant to the Company's
share option schemes. The relevant calculations have been carried
out in accordance with FRS14.
30-Jun-00 30-Jun-99 31-Dec-99
#000 #000 #000
6. Current assets
Work in progress 9,579 9,276 9,304
Trade debtors and prepayments 18,150 17,392 18,108
Cash and liquid investments 4,473 4,848 5,665
______ ______ ______
32,202 31,516 33,077
______ ______ ______
7. Creditors: amounts falling due within one year
Borrowings 18,736 3,803 9,192
Trade creditors 6,107 6,077 7,032
Corporation tax 159 1,502 1,145
Other creditors and accruals 8,312 8,849 9,069
Dividends payable 1,289 1,416 1,125
______ ______ ______
34,603 21,647 27,563
______ ______ ______
8. Creditors: amounts falling due after one year:
Borrowings 7,942 14,669 13,713
Creditors 849 844 804
Provisions for
liabilities and charges 125 337 146
______ ______ ______
8,916 15,850 14,663
______ ______ ______
30-Jun-00 30-Jun-99 31-Dec-99
#000 #000 #000
9. Net borrowings
Bank loans and
overdrafts (secured) 18,213 3,382 8,739
Finance lease obligations 523 421 453
______ ______ ______
18,736 3,803 9,192
______ ______ ______
Amounts falling due after one year:
Bank loans and
overdrafts (secured) 7,645 14,225 13,321
Finance lease obligations 297 444 392
______ ______ ______
7,942 14,669 13,713
______ ______ ______
Total borrowings 26,678 18,472 22,905
Cash and liquid investments (4,473) (4,848) (5,665)
______ ______ ______
Net borrowings 22,205 13,624 17,240
______ ______ ______
10. Reconciliation of operating (loss)/profit to net
cashflow from operating activities
Operating (loss)/profit (80) 3,107 6,306
Exceptional expenses (648) (248) (2,624)
Depreciation 672 402 953
Increase in work in progress (255) (1,377) (1,368)
Decrease/(increase) in debtors 297 (2,639) (3,079)
(Decrease)/increase in creditors(1,878) 700 717
(Decrease) in insurance
technical provision (355) (116) (614)
______ ______ ______
Net cash flow from
operating activities (2,247) (171) 291
______ ______ ______
11. 1999
Financial statements
The figures for the year ended 31 December 1999 have been extracted
from the audited statutory financial statements of Miller Fisher Group
plc which have been filed at Companies' House. The auditors' report on
those financial statements was unqualified.
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