RNS Number:6826J
Miller Fisher Group PLC
10 September 2001
For Immediate Release 10 September 2001
Miller Fisher Group plc
Interim Results
"A Positive Start To The Year"
Miller Fisher Group, the provider of outsourcing services to the insurance and
financial services industries, announces its interim results for the half year
to 30 June 2001.
Key points: - Achievement of objectives
* First half operating profit before exceptional expenses of #0.6 million
against an operating loss of #80,000 in first half of previous year.
* Successful disposal of Homecare Insurance for #4.5 million
* Operating costs of continuing Group operations overall reduced by 8.3%
in the half year to #21.1 million (2000: #23.0 million). UK operating
costs reduced by nearly 15%
* Cost reductions already achieved in UK will exceed #5 million in full
year
* Exceptional costs reduced to #0.1 million (2000: #0.6 million)
* Bank borrowings reduced by #5 million since 31 December 2000. Operating
cash inflow in first half of #2.4 million (2000: #2.6 million outflow) - a
turnround of #5 million
* Significant reduction in pre-tax loss to #0.66 million (2000: #1.55
million loss)
* Irish operations achieve record results at all levels
Sir Timothy Kitson, Chairman, said:
"We have had a better start to the first half of this year than we did last
year, although we still have some way to go before we return to the profits
and margins that we experienced in previous years. We have taken significant
costs out of the business and we are seeing growth in certain areas of
activity especially in the Irish operations and our London Market operation.
Further results from these efforts should come through in the second half of
the year.
We are trading against a difficult market background and it will require
maximum effort to ensure that revenues are maintained. However, provided that
we maintain our revenue streams at the same levels as the first half of the
year, we anticipate that we will show a further improvement in operating
profit in the second half of the year."
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
HALF YEAR TO 30 JUNE 2001
CHAIRMAN'S STATEMENT
The Board of Miller Fisher Group announces the interim results for the six
month period to 30 June 2001. During the period the Group disposed of its
wholly owned subsidiary Homecare Insurance. Therefore the results include a
contribution from Homecare Insurance for a period of only four months.
Turnover
Total turnover for the Group was #26.4 million (2000: #29.6 million). Within
this figure the turnover of Homecare Insurance, which has been treated as a
discontinued activity, was #3.8 million for four months compared to #5.4
million for the full six months in the previous year. Turnover from continuing
operations was #22.6 million which was 6.6% less than the #24.2 million
turnover for the first half of last year.
Profits
The Group reported an operating profit before exceptional items and interest
of #0.6 million, a substantial improvement on the operating loss of #80,000 in
the first six months of 2000.
Operating costs of continuing operations of the Group as a whole were down by
8.3% on last year at #21.1 million (2000: #23.0 million). In the UK, operating
costs were down by #2.9 million which was a reduction of 14.7% year on year.
This reflected the benefits of our reorganisation and re-engineering
programme, and we anticipate that our operating costs in the UK will be over
#5 million lower in 2001 than they were last year.
Exceptional costs were also less at #0.1 million (2000: #0.6 million) and
relate primarily to redundancy and reorganisation costs less the book profit
on the sale of Homecare. After an interest charge of #1.1 million (2000: #0.8
million) the Group recorded a pre-tax loss of #0.66 million which was a
significant reduction on the loss in the first half of 2000 of #1.55 million.
Earnings
Earnings per share before exceptional items showed a loss of 0.28p (2000:
0.37p loss) and after exceptional items showed a loss of 0.36p (2000: 0.65p
loss).
Dividend
The Board has decided not to declare an interim dividend for the current year.
In 2000 an interim dividend of 0.10p was declared.
Overview
During the first half of the year we sold Homecare Insurance which provided
insurance cover for mobile telephones and other electrical goods for a
consideration of #4.5 million, thus enabling us to concentrate on our core
activities of third party administration, claims management and inspection
services.
The first half of 2001 has seen a continuation of the consolidation of the UK
insurance industry. This has resulted in a smaller number of larger players
and the concentration of the household and bulk personal lines business. As
part of this consolidation there has been a reduction in the number of loss
adjusting panel members servicing these insurers as well as significant
downward pressure on the pricing of bulk claims handling. These trends had
started to emerge during 2000 which resulted in us implementing our
re-engineering programme for our UK activities at the end of last year and
which has followed through into the first half of this year. This programme,
which has now been completed, involved consolidating our branch network from
over 30 branches last year into 11 regional service centres and substantially
reducing infrastructure costs.
We are concentrating our loss adjusting activities in the UK on medium sized
insurers, the London Market, including Lloyd's, and the broker market. At the
same time we are extending our activities in third party administration and in
the Irish market.
Operations
We have completed the integration of the various Group operations in the UK
and we now trade under the single name of Miller Fisher. These operations
include loss adjusting services, third party administration and outsourcing
services, as well as motor vehicle inspection services and investigation
services. As part of this re-organisation we have created a new management
structure and have made a number of new appointments including Chief Operating
Officer, Business Development Director and Group Technology Director. This now
provides us with a clear focus for our activities as well as improving
operational efficiency by integrating into "one company".
The UK loss adjusting business saw net billings approximately 4% higher in the
first half of the year compared to the previous year. This was partially the
result of the carry forward of the high level of claims received at the end of
2000 as a result of the storm and flood conditions experienced in the UK at
the end of last year. This had resulted in a very high level of carried
forward work in progress at December 2000. The completion of these claims has
meant that the value of work in progress at the 30 June was some #1.3 million
lower than it had been at the end of last year.
The third party administration business based at Waltham Cross had a
disappointing start to the year, since, despite keeping costs under control,
revenues did not achieve expectations. Our motor inspection business started
the year well, but saw a lower level of activity in the second quarter.
However activity in the third quarter has started to pick up again.
International
Our international operations include Miller Farrell in Ireland, our operations
in Dubai, Hong Kong, Singapore, Caracas and Salzburg and our international
office in London.
In Ireland, Miller Farrell had an excellent start to the year, producing
record turnover and profits. It continues to consolidate its position as the
premier player in the local market. Overseas, the office in Singapore is now
established and is starting to produce a good flow of work. After a quiet
start for Hong Kong, Dubai and Caracas, the signs are that the second half of
the year will produce better contributions. The international operations in
London have gone from strength to strength with the recruitment of a number of
excellent professionals specialising in London Market operations. We see this
as a growth area of activity in the future.
Finance
In the first half of the year, we achieved a greatly improved operating cash
flow with a net cash inflow from continuing activities of #2.4 million
compared to a net outflow of #2.6 million for the comparable period last year.
This represents a positive turnround of #5 million.
We also reduced bank borrowings. Total borrowings as at 30 June 2001 were
#24.8 million, a decrease of #5 million compared to the figure at 31 December
2000. Despite this improvement, it is our intention to reduce borrowings
further especially as the possibility exists of an increase in the UK interest
rates later next year. We believe that further reductions can be achieved by
positive cash flow and better management of working capital.
Outlook
We had a better start to the first half of this year than we did last year,
although we still have some way to go before we return to the profits and
margins that we had experienced in previous years. We have taken significant
costs out of the business and we are seeing growth in certain areas of
activity especially in the Irish operations and our London Market operation.
Further results from these efforts should come through in the second half of
the year.
We are trading against a difficult market background and it will require
maximum effort to ensure that revenues are maintained. However, provided that
we maintain our revenue streams at the same levels as the first half of the
year, we anticipate that we will show a further improvement in operating
profit in the second half of the year.
Sir Timothy Kitson
Chairman
10 September 2001
MILLER FISHER GROUP PLC
Unaudited Consolidated Profit and Loss Account
for the six months ended 30 June 2001
unaudited unaudited audited
6 months 6 months year
note 30-Jun-01 30-Jun-00 31-Dec-00
#000 #000 #000
TURNOVER 2
Continuing operations 23,853 24,036 48,344
Discontinued activities 3,834 5,356 10,489
27,687 29,392 58,833
Movement in work in progress (1,268) 182 586
Total turnover 26,419 29,574 59,419
External charges:
Continuing operations (1,057) (1,504) (2,853)
Discontinued activities (3,229) (4,629) (9,014)
(4,286) (6,133) (11,867)
Net income
Continuing operations 21,528 22,714 46,077
Discontinued activities 605 727 1,475
22,133 23,441 47,552
Operating costs
Continuing operations (21,124) (23,012) (45,533)
Discontinued activities (445) (509) (941)
(21,569) (23,521) (46,474)
Operating profit/(loss) before exceptional
expenses
Continuing operations 404 (298) 544
Discontinued activities 160 218 534
Total 564 (80) 1,078
Exceptional expenses 3 (586) (648) (2,241)
Profit on disposal of subsidiary 3 442 0 0
undertaking
Total (144) (648) (2,241)
Operating profit/(loss) after exceptional 420 (728) (1,163)
expenses
Interest payable (1,080) (820) (1,942)
Loss on ordinary activities before tax (660) (1,548) (3,105)
Taxation 63 499 (59)
Loss on ordinary activities after tax (597) (1,049) (3,164)
Dividends 0 (164) (166)
Retained loss for the period (597) (1,213) (3,330)
Loss per ordinary share (pence):
Before exceptional expenses 5 (0.28) (0.37) (0.57)
After exceptional expenses 5 (0.36) (0.65) (1.95)
Unaudited Consolidated Balance Sheet
as at 30 June 2001
unaudited unaudited audited
note 30-Jun-01 30-Jun-00 31-Dec-00
#000 #000 #000
Fixed assets:
Intangible fixed assets 31,556 31,084 31,584
Tangible fixed assets 5,170 5,403 5,393
36,726 36,487 36,977
Current assets 6 28,602 32,202 34,310
Creditors: due within one year 7 (35,127) (34,603) (39,824)
Net current liabilities (6,525) (2,401) (5,514)
Total assets less current 30,201 34,086 31,463
liabilities
Creditors: due after one year 8 (7,146) (8,916) (7,811)
Net assets 23,055 25,170 23,652
Share capital 8,201 8,050 8,201
Share premium 787 257 787
Other reserves 16,516 16,462 16,516
Profit and loss account (2,449) 401 (1,852)
Shareholders' funds - equity interest 23,055 25,170 23,652
Unaudited Consolidated Cash Flow Statement
for the six months ended 30 June 2001
unaudited unaudited audited
note 6 months 6 months year
30-Jun-01 30-Jun-00 31-Dec-00
#000 #000 #000
Net cash flow from operating activities 10
Continuing operations 2,415 (2,643) (401)
Discontinued activities 248 396 263
Total 2,663 (2,247) (138)
Returns on investments and servicing of finance (1,080) (820) (1,968)
Taxation paid 1 (471) (865)
Capital expenditure (472) (1,192) (1,710)
Acquisitions and disposals 1,454 (235) (1,492)
Equity dividends paid 0 0 (1,291)
Cash flow before use of liquid resources and 2,566 (4,965) (7,464)
financing
Financing (2,765) 3,773 (720)
Cash balances transferred on sale of Homecare (3,346) 0 0
Decrease in cash for the period (3,545) (1,192) (8,184)
Reconciliation of cash flow to movement in net debt:
Decrease in cash for the period (3,545) (1,192) (8,184)
Effect of change in debt and lease financing 5,015 (3,773) 721
Change in net debt arising from cash flows 1,470 (4,965) (7,463)
Opening net debt (24,703) (17,240) (17,240)
Closing net debt (23,233) (22,205) (24,703)
Notes to the Unaudited Consolidated Interim Results
for the six months ended 30 June 2001
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 2000 Report and Financial
Statements.
2. Turnover 30-Jun-01 30-Jun-00 31-Dec-00
#000 #000 #000
Turnover includes insurance premiums receivable 3,834 5,356 10,489
of
3. Exceptional expenses 30-Jun-01 30-Jun-00 31-Dec-00
#000 #000 #000
Exceptional expenses comprise:
Redundancy and reorganisation 212 648 607
Office relocation and temporary staff 190 0 1,119
International start up expenses 0 0 274
Professional fees 184 0 241
586 648 2,241
Profit on disposal of Homecare (442) 0 0
144 648 2,241
On 8 May 2001 the Group disposed of Homecare Holdings Limited and its wholly
owned subsidiary Homecare Insurance Limited to CPP Holdings Limited. The profit
on disposal comprises the following.
#000
Estimated net sale proceeds 1,928
Net assets disposed of (1,486)
Profit on disposal 442
In addition CPP Holdings Limited repaid Homecare Holdings Limited's bank debt of
#2.25 million
4. Dividend
The Board does not recommend the payment of a dividend (2000: 0.10 pence per
share).
5. Loss per ordinary share
The loss per ordinary share has been calculated as follows:
30-Jun-01 30-Jun-00 31-Dec-00
#000 #000 #000
Loss attributable to ordinary shareholders:
Before exceptional expenses and profit on
disposal (453) (595) (923)
After exceptional expenses and profit on (597) (1,049) (3,164)
disposal
Weighted average number of shares in issue 164,017,410 160,682,495 162,040,246
Adjusted weighted average number of shares in
issue 164,017,410 165,998,846 163,313,563
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.
6. Current assets 30-Jun-01 30-Jun-00 31-Dec-00
#000 #000 #000
Work in progress 8,665 9,579 9,979
Trade debtors and prepayments 18,382 18,150 19,231
Cash and liquid investments 1,555 4,473 5,100
28,602 32,202 34,310
7. Creditors: amounts falling due within one 30-Jun-01 30-Jun-00 31-Dec-00
year #000 #000 #000
Borrowings 18,679 18,736 23,215
Trade creditors 7,317 6,107 6,370
Corporation tax 709 159 568
Other creditors and accruals 8,422 8,312 9,671
Dividends payable 0 1,289 0
35,127 34,603 39,824
8. Creditors: amounts falling due after one 30-Jun-01 30-Jun-00 31-Dec-00
year: #000 #000 #000
Borrowings 6,109 7,942 6,588
Creditors 463 849 485
Provisions for liabilities and charges 574 125 738
7,146 8,916 7,811
9. Borrowings 30-Jun-01 30-Jun-00 31-Dec-00
#000 #000 #000
Amounts falling due within one year:
Bank loans and overdrafts (secured) 18,490 18,213 22,637
Finance lease obligations 189 523 578
18,679 18,736 23,215
Amounts falling due after one year:
Bank loans and overdrafts (secured) 5,585 7,645 6,320
Finance lease obligations 524 297 268
6,109 7,942 6,588
Total borrowings 24,788 26,678 29,803
10. Reconciliation of operating profit to net 30-Jun-01 30-Jun-00 31-Dec-00
cashflow from operating activities #000 #000 #000
Operating profit 564 (80) 1,078
Exceptional expenses (586) (648) (2,241)
Depreciation 647 672 1,198
Decrease/(increase) in work in progress 1,314 (255) (660)
Decrease/(increase) in debtors (180) 297 (781)
(Decrease)/increase in creditors 904 (2,233) 1,268
Net cash flow from operating activities 2,663 (2,247) (138)
11. 2000 Financial statements
The figures for the year ended 31 December 2000 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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