Half Yearly Report (3514O)
16 September 2011 - 8:00AM
UK Regulatory
TIDMUNIQ
RNS Number : 3514O
Uniq PLC
16 September 2011
16(th) September 2011
Uniq PLC
("Uniq", "Group" or the "Company")
Results for Half Year Ended 30 June 2011
RESULTS FOR HALF YEAR
The half year to 30 June 2011 delivered both a continuation of
the improvement in trading performance and a transformation of the
Group's balance sheet through a successful restructuring which
removed the disproportionately large pension deficit. Operating
profit before significant items and group costs improved by 47% to
GBP4.7m (GBP3.2m half year to 30 June 2011) on the back of improved
trading in the Food to Go division and as a result of further
restructuring within Desserts. The pension restructuring gave rise
to a significant credit to the profit and loss account and as a
result Shareholders' funds improved from a negative position of
GBP21.9m at 31 December 2010 to a positive GBP108.9m at 30 June
2011. The financial transformation enabled the Group to conduct a
sale process, initiated by the Pension Scheme, which resulted in a
recommended offer from Greencore Plc ("Greencore").
FOOD TO GO
Food to Go sales increased by 9.0%* reflecting continued strong
growth in sandwiches on the back of a continuous programme of
successful new product development. The growth in profitability to
GBP5.8m, from GBP5.0m in the same period last year, reflects our
ability to manage profit margins through efficiency and tight
control of costs in the face of higher raw material prices.
DESSERTS
Desserts sales fell by 8.2%* as a result of the loss of some low
margin everyday desserts business, following the price increases
pushed through in 2010 and as a result of the planned exit of
cottage cheese. Positive progress was made in sales of Premium
desserts, reflecting the more favourable market dynamics in this
sub-sector, while the sales of Cadbury chocolate desserts were
flat. Despite the overall fall in Desserts sales, the level of loss
in this division reduced again to GBP1.1m compared to a loss of
GBP1.8m for the same period last year. Since the half-year end,
further action has been announced to reduce the scale of our
Desserts business to focus on the most profitable areas.
BALANCE SHEET
In April 2011, the Group was discharged from the
disproportionately large legacy pension deficit of more than
GBP400m (on an actuarial basis) in exchange for a 90.2%
shareholding in the Company and a cash payment to the pension
scheme of GBP14m. The consequent removal of GBP146.2m of the
pension accounting liability (GBP149.4m at 31 December 2010) and
the issue of new shares, including share premium, of GBP66.7m
enabled the Company to secure a new GBP25m bank facility with a
three year term. As at 30 June 2011 the Company had GBP1.6m of net
debt outstanding and the financial strength to continue to trade as
a stand-alone entity for the foreseeable future with the threat of
the pension deficit removed.
POST BALANCE SHEET EVENTS
As part of the pension restructuring it was agreed to appoint a
corporate finance advisor to assess how the Pension Scheme could
realise the best value for their 90.2% holding in Uniq. In July
2011, it was announced that the Boards of Uniq and Greencore were
recommending a cash offer of 96p a share for the whole of Uniq and
that the Pension scheme had agreed to accept the offer with respect
to its 90.2% shareholding. This offer was approved by the
shareholders of Greencore in August 2011, Irish competition
clearance has been received and completion of the transaction is
subject to the outcome of the review by the Office of Fair Trading
which is expected by the end of September 2011.
On 23 August 2011 Uniq announced its decision to close the
Everyday desserts business unit at Minsterley by June 2012 with the
possible loss of 350 jobs. This, in addition to the previously
announced withdrawal from the Premium yogurt market, will leave
Minsterley with about 100 staff totally focussed on chocolate
desserts. The carrying value of assets at Minsterley (GBP47m as at
30 June 2011) will reduce by approximately GBP20m as a result of
the asset write-off associated with both the Yogurt and the
Everyday dessert business units.
For further information:
Uniq plc +44 (0)1753 276011
Geoff Eaton Chief Executive
Martin Beer Finance Director
MHP +44 (0)20 3128 8791
Tim McCall
Investec Investment Banking (Nominated Adviser
& Broker) +44 (0)20 7597 5970
Clifford Halvorsen
David Anderson
(*adjusted for the extra week in 2010)
CONDENSED CONSOLIDATED INTERIM INCOME STATEMENT
for the half year ended 30 June 2011
Year
ended
30.06.11 30.06.10 31.12.10
Unaudited Unaudited Audited
Before Sig- Before Sig-
sig- nificant sig- nificant
nificant items nificant items
(note (note
items 5) Total items 5) Total Total
GBPm GBPm GBPm GBPm GBPm GBPm GBPm
CONTINUING
OPERATIONS
Revenue (note 3) 151.8 - 151.8 156.3 - 156.3 311.9
Cost of sales (128.0) - (128.0) (133.3) - (133.3) (264.3)
----------------- --------- ----------------- ----------------- --------- -------- ---------
Gross profit 23.8 - 23.8 23.0 - 23.0 47.6
Distribution
expenses (8.4) - (8.4) (8.9) - (8.9) (18.3)
Administrative
expenses (12.5) 68.6 56.1 (13.1) (2.6) (15.7) (27.6)
----------------- --------- ----------------- ----------------- --------- -------- ---------
Operating
profit/(loss)(note
3) 2.9 68.6 71.5 1.0 (2.6) (1.6) 1.7
Net pension
interest (3.5) - (3.5) (5.7) - (5.7) (12.1)
Other finance
income 1.6 - 1.6 0.5 - 0.5 1.2
Finance expense (0.4) - (0.4) (1.8) - (1.8) (2.0)
----------------- --------- ----------------- ----------------- --------- -------- ---------
Net finance charges
(note 4) (2.3) - (2.3) (7.0) - (7.0) (12.9)
Profit/(loss)
before tax 0.6 68.6 69.2 (6.0) (2.6) (8.6) (11.2)
Income tax expense - - - - - - -
Profit/(loss) from
continuing
----------------- --------- ----------------- ----------------- --------- -------- ---------
Operations 0.6 68.6 69.2 (6.0) (2.6) (8.6) (11.2)
DISCONTINUED
OPERATIONS
Profit from
discontinued
operations (net of
tax) - - - 3.2 32.9 36.1 35.4
----------------- --------- ----------------- ----------------- --------- -------- ---------
Profit/(loss) for
the period 0.6 68.6 69.2 (2.8) 30.3 27.5 24.2
----------------- --------- ----------------- ----------------- --------- -------- ---------
Earnings per
ordinary share
Basic and
diluted 60.8p 24.2p 21.3p
----------------- -------- ---------
Continuing
operations 60.8p (7.5)p (9.8p)
Discontinued
operations - 31.7p 31.1p
----------------- -------- ---------
Average Euro
exchange rate 1.15 1.15 1.17
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the half year ended 30 June 2011
Year ended
30.06.11 Unaudited 30.06.10 Unaudited 31.12.10 Audited
GBPm GBPm GBPm
Profit for the
period 69.2 27.5 24.2
Other
comprehensive
(expense)/income
Actuarial
(loss)/gain
recognised on the
pension schemes (5.7) 3.8 (1.2)
Effective portion
of changes in
fair value of
cashflow hedges 0.2 0.1 0.1
Foreign currency
translation
differences for
foreign
operations 0.4 0.8 0.1
Cumulative foreign
exchange related
to disposal of
business recycled
to
income statement - (31.6) (30.3)
Net gain on hedge
of net investment
in foreign
operation - 0.1 0.1
------------------ ------------------ ------------------
Other
comprehensive
expense for the
period, net of
income tax (5.1) (26.8) (31.2)
------------------ ------------------ ------------------
Total
comprehensive
income/(expense)
for the period 64.1 0.7 (7.0)
------------------ ------------------ ------------------
CONDENSED CONSOLIDATED INTERIM BALANCE SHEET
at 30 June 2011
Year ended
30.06.11 Unaudited 30.06.10 Unaudited 31.12.10 Audited
GBPm GBPm GBPm
ASSETS
Non-current assets
Property, plant
and equipment 78.7 78.9 80.4
Intangible assets 30.5 30.5 30.5
Restricted cash - 97.4 -
Deferred tax
assets 13.9 13.9 13.9
123.1 220.7 124.8
------------------ ------------------ ------------------
Current assets
Inventories 12.9 11.8 13.8
Trade and other
receivables 28.4 37.3 33.2
Cash and cash
equivalents 11.3 47.5 10.8
52.6 96.6 57.8
------------------ ------------------ ------------------
Total assets 175.7 317.3 182.6
------------------ ------------------ ------------------
LIABILITIES
Non-current
liabilities
Borrowings 11.4 - -
Retirement benefit
obligations (note
6) 3.2 236.2 149.4
Provisions 1.1 1.0 0.8
15.7 237.2 150.2
------------------ ------------------ ------------------
Current
liabilities
Borrowings 1.5 29.3 -
Trade and other
payables 40.3 46.9 41.6
Provisions 1.5 9.5 5.0
Income tax
liabilities 7.8 8.7 7.7
51.1 94.4 54.3
------------------ ------------------ ------------------
Total liabilities 66.8 331.6 204.5
------------------ ------------------ ------------------
Total assets less
liabilities 108.9 (14.3) (21.9)
------------------ ------------------ ------------------
EQUITY
Shareholders'
equity
Total called up
share capital 1.2 11.5 11.5
Share premium 65.6 0.1 0.1
Other reserves (318.1) (330.8) (330.2)
Retained earnings 360.2 304.9 296.7
------------------ ------------------ ------------------
Total equity
attributable to
equity holders of
the company 108.9 (14.3) (21.9)
------------------ ------------------ ------------------
Closing Euro
exchange rate 1.11 1.21 1.16
CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES
IN EQUITY
for the half year ended 30 June 2011
Share Share Merger Hedging Translation Retained
capital premium reserve reserve reserve earnings Total
GBPm GBPm GBPm GBPm GBPm GBPm GBPm
Changes in
equity for
2010
At 1 January
2010 11.5 0.1 (330.2) (0.1) 30.1 273.4 (15.2)
Total
comprehensive
income for the
period - - - 0.1 (30.7) 31.3 0.7
Share-based
compensation
charge - - - - - 0.2 0.2
At 30 June 2010 11.5 0.1 (330.2) - (0.6) 304.9 (14.3)
------- ------- ------- ------- ----------- -------- ------
Changes in
equity for
2011
At 1 January
2011 11.5 0.1 (330.2) - - 296.7 (21.9)
Total
comprehensive
income for the
period - - - 0.2 0.4 63.5 64.1
Reorganisation
and issue of
share capital (10.3) 65.5 11.5 66.7
--------
At 30 June 2011 1.2 65.6 (318.7) 0.2 0.4 360.2 108.9
------- ------- ------- ------- ----------- -------- ------
CONDENSED CONSOLIDATED INTERIM CASH FLOW STATEMENT
for the half year ended 30 June 2011
30.06.11 Year ended
Unaudited 30.06.10 Unaudited 31.12.10 Audited
GBPm GBPm GBPm
Cash flows from
operating
activities
Profit for the
period 69.2 27.5 24.2
Income tax expense - 0.5 0.5
Net finance charges 2.3 7.2 13.1
Depreciation and
amortisation 4.7 4.8 9.9
Asset impairment - 1.5 1.6
Charge for
share-based
payments 0.1 0.2 0.3
(Profit) on disposal
of businesses - (33.6) (32.9)
Gain on curtailment
and settlement of
pensions (73.7) - -
Difference between
pension charge and
cash contribution (81.3) (0.7) (98.6)
Increase in working
capital (0.9) (5.9) (10.0)
(Decrease)/Increase
in provisions (3.2) 0.5 (1.6)
----------------- ------------------ -----------------
Cash generated from
/(utilised by)
operations (82.8) 2.0 (93.5)
Interest paid (0.2) (1.2) (1.7)
Interest received 1.6 0.4 0.7
Income tax
received/(paid) 0.1 (0.4) (1.3)
Net cash generated
from/ (utilised by)
operating
activities (81.3) 0.8 (95.8)
----------------- ------------------ -----------------
Cash flows from
investing
activities
Disposal proceeds,
net of cash
disposed of 5.4 27.7 26.8
Purchases of
property, plant and
equipment (3.0) (8.5) (15.7)
Proceeds from sale
of property, plant
and equipment - 2.2 2.2
Net cash
inflow/(outflow)
from investing
activities 2.4 21.4 13.3
----------------- ------------------ -----------------
Cash flows from
financing
activities
Proceeds from
borrowings 13.5 1.6 (27.5)
Payment of
transaction costs
related borrowings (0.7) - -
Proceeds from issue
of shares 66.6 - -
Payment of finance
lease - (0.3) (0.2)
Cash included in
restricted cash - (0.4) 97.0
Net cash inflow from
financing
activities 79.4 0.9 69.3
----------------- ------------------ -----------------
Net increase in cash
and cash
equivalents 0.5 23.1 (13.2)
Cash and cash
equivalents at
beginning of
period 10.8 23.9 23.9
Effect of foreign
exchange rate
changes - (0.1) 0.1
Cash and cash
equivalents at end
of period 11.3 46.9 10.8
----------------- ------------------ -----------------
Cash and cash
equivalents consist
of:
Cash at bank and in
hand - continuing 11.3 47.5 10.8
Bank overdrafts -
continuing - (0.6) -
11.3 46.9 10.8
----------------- ------------------ -----------------
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
for the half year ended 30 June 2011
1 Basis of Preparation
These half year financial statements have been prepared in
accordance with IAS 34 Interim Financial Reporting (amended),
as adopted by the EU. The financial information included in
this document is unaudited and does not include all the information
required for full annual financial statements. It should be
read in conjunction with the consolidated financial statements
of the group for the year ended 31 December 2010. The consolidated
financial statements of the group were prepared in accordance
with IFRS, International Accounting Standards (IAS) and related
IFRIC interpretations in issue, that had been endorsed by the
European Commission at 31 December 2010.
Financial period
The financial statements are prepared to reflect trading up
to the Saturday nearest to the accounting reference date. This
period's income statement covers the 26-week period ended 2
July 2011 (2010: 27 week period ended 3 July 2010).
These half year financial statements were approved by the board
of directors on 16th September 2011.
2 Accounting policies
The accounting policies applied by the group in these half
year financial statements are the same as those applied by
the group in its consolidated financial statements for the
year ended 31 December 2010.
3 Segmental analysis
Segment result
before
significant
Segment Revenue items
30.6.11 30.6.10 30.6.11 30.6.10
Un- Un- 31.12.10 Un- Un- 31.12.10
audited audited Audited audited audited Audited
GBPm GBPm GBPm GBPm GBPm GBPm
------- ------- ---------- ------- ------- ----------
Desserts 70.1 79.1 154.9 (1.1) (1.8) (2.7)
Food to Go 81.7 77.2 157.0 5.8 5.0 11.0
------- ------- ---------- ------- ------- ----------
Reportable segments 151.8 156.3 311.9 4.7 3.2 8.3
------- ------- ----------
Corporate expenses (unallocated) (1.8) (2.2) (4.2)
-------
Operating profit before significant
items 2.9 1.0 4.1
Significant items 68.6 (2.6) (2.4)
------- ------- ----------
Operating profit/(loss) after significant
items 71.5 (1.6) 1.7
Net finance charges (2.3) (7.0) (12.9)
------- ------- ----------
Profit/(loss) before
tax 69.2 (8.6) (11.2)
Income tax expense - - -
------- ------- ----------
Loss from continuing operations 69.2 (8.6) (11.2)
Profit/(loss) from discontinued
operations
(net of tax) (note 9) - 36.1 35.4
------- ------- ----------
Profit/(loss) for the period 69.2 27.5 24.2
------- ------- ----------
Revenues from one customer of both segments represents
approximately GBP92.7m (June 2010:GBP84.3m; December
2010:GBP178.0m) of the group's total revenues.
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
for the half year ended 30 June 2011
4 Finance income and expenses
Year ended
30.06.11 30.06.10 31.12.10
Unaudited Unaudited Audited
GBPm GBPm GBPm
Continuing operations
Finance income
Interest on bank balances - 0.1 0.3
Interest on restricted cash - 0.4 0.6
Net foreign exchange gains - - 0.3
Other interest income 1.6 - -
1.6 0.5 1.2
---------- ---------- -----------
Finance expense
Interest on bank loans (0.2) (0.7) (1.4)
Net foreign exchange losses (0.1) (0.8) -
Amortisation of finance arrangement
costs (0.1) (0.3) (0.6)
---------- ---------- -----------
(0.4) (1.8) (2.0)
---------- ---------- -----------
Net finance income/(expense) 1.2 (1.3) (0.8)
Net pension interest (3.5) (5.7) (12.1)
---------- ---------- -----------
Net finance charges (2.3) (7.0) (12.9)
---------- ---------- -----------
5 Significant items
Year ended
30.06.11 30.06.10 31.12.10
Unaudited Unaudited Audited
GBPm GBPm GBPm
Continuing operations
Restructuring costs - UK operations (1.5) (0.3) (0.4)
- Group (4.1) (0.8) (3.0)
Curtailment gain - pensions 73.7 - -
Onerous contract - - 2.6
Recovery of vat net of expenses 0.5 - -
Asset impairment - (1.5) (1.6)
68.6 (2.6) (2.4)
Discontinued operations - 32.9 32.2
---------- ---------- -----------
68.6 30.3 29.8
---------- ---------- -----------
Restructuring costs - UK operation
In 2011 this relates to restructuring costs in Desserts
operations and in 2010 to the downsizing of the cottage cheese
operation.
Restructuring costs - Group
In 2011 and 2010 this includes professional costs incurred in
relation to the pension resolution and other costs incurred in
relation to the downsizing of the group head office.
Curtailment gain -pensions
The curtailment gain relates to the release of the pension
deficit in relation to the settlement agreed with the pension
fund.
Asset impairment
This relates to the impairment of tangible fixed assets of our
cottage cheese operation in the Desserts segment.
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
for the half year ended 30 June 2011
6 Retirement
benefit
obligations
Year ended
30.06.11 Unaudited 30.06.10 Unaudited 31.12.10 Audited
GBPm GBPm GBPm
Movement in
liability in the
period
Balance at the
beginning of the
period (149.4) (235.1) (235.1)
Current and past
service costs - - -
Curtailments and
settlements 73.7 - -
Contributions by
the employer 81.3 0.6 98.4
Net finance charge (3.4) (5.5) (11.6)
Benefits paid 0.3 - 0.1
Actuarial
gain/(loss) (5.7) 3.8 (1.2)
Balance at the end
of the period (3.2) (236.2) (149.4)
------------------ ------------------ ------------------
7 Contingent liabilities
There are contingent liabilities that arise in the
normal course of business in respect of indemnities,
warranties, guarantees and legal claims. Certain guarantees
are performance related. The Directors have considered
that none of current claims is expected to result
in a material loss to the Group.
8 Events after balance sheet
In July 2011 it was announced that the Board of Uniq
and Greencore were recommending an offer of 96p a
share for the whole of Uniq and that the Pension scheme
had agreed to accept the offer with respect to its
90.2% holding. This offer was approved by the shareholders
of Greencore in August 2011, Irish competition clearance
has been received and completion of the transaction
is subject to the outcome of the review by the Office
of Fair Trading which is expected by the end of September
2011.
On 23 August 2011 Uniq announced its decision to close
the Everyday desserts business unit at Minsterley
by June 2012 with the possible loss of 350 jobs. This,
in addition to the previously announced withdrawal
from the Premium yogurt market, will leave Minsterley
with about 100 staff totally focussed on chocolate
desserts. The carrying value of assets at Minsterley
(GBP47m as at 30 June 2011) will reduce by approximately
GBP20m as a result of the asset write-off associated
with both the Yogurt and the Everyday dessert business
units.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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