RNS Number:7938V
Waterline Group plc
19 December 2005
Waterline Group PLC
Unaudited Interim Results
Six months ended
30 September 2005
WATERLINE GROUP PLC
CEO's statement for the six months ended 30 September 2005
We are pleased to deliver our maiden Interim Results for the period up to 30th
September 2005, three months after our flotation on AIM. In line with the Board
of Directors objectives for expanding the Group's UK presence the results
presented below include one month of Coolectric, a business acquired on 1st
September 2005.
In what has been a very challenging market place, our revenue levels of #35.0m
are only 1.7% below the first six months of last year (2005 : #35.6m), based on
the Group's structure in 2005. If, however, we include the first month of
trading for Coolectric the overall turnover for the Group is increased to
#35.8m. The gross margin achieved during the six month period is 23.9% compared
with 23.5% for the year ending 31 March 2005.
Profit before tax has increased by 38.5% compared with the same period in 2005.
This is further increased to 48.6% when the profit before tax for Coolectric of
#51,000 is included. The trading profit for the Group has been compared before
the deduction of exceptional costs relating to the IPO of #227,000.
The basic earnings per share is at 0.02p for the half year. The earnings per
share for 31 March 2005 has been restated based on the restructuring of the
Group's share capital undertaken prior to the flotation. While the Board of
Directors have decided not to declare a dividend, it is their continued
intention to pursue a progressive dividend policy in line with annual profit
growth.
The net assets per share have increased by 9p to 49p per share (2005 : 40p). The
cash flow has continued to be strong with #2.7m generated from operations. When
this is combined with the proceeds of the share issue this has allowed an
initial payment by the Group for the acquisition of Coolectric amounting to
#880,000. The net effect of these movements leaves the Group with a cash
increase of #3.1m.
The second half of our year will remain challenging. It appears that products
particularly aimed at the higher end of our sector are selling well, whilst
entry point and middle market products continue to be under price and margin
pressure.
We look forward to a strong showing at our regional trade shows during March and
April 2006, when we expect to meet around 3,000 trade customers who will be able
see the latest products from our portfolio.
We shall be integrating the Coolectric business into our site at Newport Pagnell
during February 2006 and early signs of our projected growth for the business
are promising.
We look forward to delivering full term results in line with market
expectations.
MICHAEL LAWRENCE December 2005
WATERLINE GROUP PLC
Consolidated profit and loss account for the six months ended 30 September 2005
Continuing operations
Acquisitions
Six months ended Six months ended Six months ended Year ended
30 September 30 September 30 September 31 March
2005 2005 2005 2005
(unaudited) (unaudited) (unaudited) (audited)
# # # #
Turnover 34,970,368 780,346 35,750,714 71,209,733
Cost of sales 26,591,312 596,703 27,188,015 54,501,954
________ _________ _________ _________
Gross profit 8,379,056 183,643 8,562,699 16,707,779
Distribution costs 2,426,027 5,118,548
Administrative expenses 5,188,335 9,988,110
_________ _________
Operating profit 948,337 1,601,121
Other income 19,481 28,016
Interest payable and similar charges (352,631) (688,248)
_________ _________
Profit on ordinary activities before taxation 615,187 940,889
Taxation on profit from ordinary activities 350,357 460,833
_________ _________
Retained profit for the period 264,830 480,056
Earnings per share
Basic (pence per share) 0.02 0.05
Diluted (pence per share) 0.02 0.05
WATERLINE GROUP PLC
Consolidated statement of total recognised gains and losses and reconciliation
of movements in shareholders' funds for the six months ended 30 September 2005
Six months ended Year ended
30 September 31 March
2005 2005
(unaudited) (audited)
# #
Statement of total recognised gains and losses
Profit for the year 264,830 480,056
Unrealised surplus on revaluation of investments - 5,256
Currency translation differences on foreign currency
net investments 69,049 (30,482)
________ ________
Total recognised gains and losses for the year 333,879 454,830
Reconciliation of movements in shareholders' funds
Six months ended Year ended
30 September 31 March
2005 2005
(unaudited) (audited)
# #
Profit for the year 264,830 480,056
Issue of shares 2,000,000 -
Costs of share issue (192,044) -
Other recognised gains and losses 69,049 (25,226)
________ ________
2,141,835 454,830
Opening shareholders' funds 4,291,700 3,836,870
________ ________
Closing shareholders' funds 6,433,535 4,291,700
WATERLINE GROUP PLC
Consolidated balance sheet at 30 September 2005
30 September 30 September 31 March 31 March
2005 2005 2005 2005
(unaudited) (unaudited) (audited) (audited)
# # # #
Fixed assets
Intangible assets 1,113,582 1,041,549
Tangible assets 6,384,679 6,252,266
Investments 21,980 15,838
_________ _________
7,520,241 7,309,653
Current assets
Stocks 9,863,281 7,809,507
Debtors 11,897,583 10,668,361
Cash at bank and in hand 1,566,389 10,626
_________ _________
23,327,253 18,488,494
Creditors: amounts falling due
within one year 21,420,730 18,942,360
_________ _________
Net current assets/(liabilities) 1,906,523 (453,866)
_________ _________
Total assets less current liabilities 9,426,764 6,855,787
Creditors: amounts falling due
after more than one year (2,924,229) (2,495,087)
Provision for liability and charges (69,000) (69,000)
_________ _________
6,433,535 4,291,700
Capital and reserves
Called up share capita l 65,568 4,128
Share premium account 1,847,931 51,879
Revaluation reserve 90,256 90,256
Other reserves 4,047 4,047
Profit and loss account 4,425,733 4,141,390
_________ _________
Shareholders' funds - equity 6,433,535 4,291,700
WATERLINE GROUP PLC
Consolidated cash flow statement for the six months ended 30 September 2005
30 September 30 September 31 March 31 March
2005 2005 2005 2005
(unaudited) (unaudited) (audited) (audited)
# # # #
Net cash inflow from operating activities 2,688,068 1,219,349
Returns on investments and
servicing of finance
Interest received 19,481 28,016
Interest paid (334,820) (663,322)
Interest element of finance lease
rental payments (17,811) (24,926)
________ ________
Net cash outflow from returns on
investments and servicing of finance (333,150) (660,232)
Taxation
UK corporation tax paid (91481) (256,635)
Overseas tax repaid/(paid) 45,764 (185,749)
________ ________
(45,717) (442,384)
Capital expenditure and financial
investment
Purchase of tangible fixed assets (265,041) (456,348)
Sale of tangible fixed assets 85,869 154,382
________ ________
(179,172) (301,966)
Acquisition and disposals
Acquisition of group companies (880,000) -
Cash acquired with subsidiary undertakings 443,737 -
_________ ________
(436,263) -
________ ________
Cash inflow/(outflow) before use of
liquid resources and financing 1,693,766 (185,233)
Financing
Issue of ordinary shares 1,807,956 -
Bank loan (157,950) (299,051)
Capital element of finance lease
rental payments (238,867) (370,293)
________ ________
1,411,139 (669,344)
________ ________
Increase /(decrease) in cash 3,104,905 (854,577)
WATERLINE GROUP PLC
Notes forming part of the interim report for the six months ended 30 September
2005
1 Basis and preparation
The accounts for the group for the six months ended 30 September 2005, which are
unaudited, were approved by the board on 7 December 2005. The accounts have been
prepared in accordance with the accounting policies set out in the annual
financial statements for the year ended 31 March 2005.
The results contained in this report do not constitute statutory accounts as
defined in Section 240 of the Companies Act 1985. The financial information for
the full preceding year is based on the statutory accounts for the year ended 31
March 2005. Those accounts on which the auditors, BDO Stoy Hayward LLP, issued
an unqualified opinion have been delivered to the Registrar of Companies.
2 Segmental analysis
Turnover Pre tax profit
Six months Year Six months Year
30 September 31 March 30 September 31 March
2005 2005 2005 2005
Analysis by geographical market: (unaudited) (audited) (unaudited) (audited)
# # # #
United Kingdom 32,921,002 65,884,764 415,376 771,677
United States of America 2,829,712 5,324,969 199,811 169,212
_________ _________ _________ _________
35,750,714 71,209,733 615,187 940,889
3 Earnings per share
Basic and diluted earnings per share for the six months ended 30 September 2005
is based on the group profit on ordinary activities after taxation of #264,830
(31 March 2005 #480,056) attributed to 11,923,276 (31 March 2005 : 10,732,800)
ordinary shares being the weighted average number of shares in issue during the
period.
4 Reserves
Share Capital Profit
Share premium Revaluation redemption and loss
Capital account reserve reserve account
# # # # #
At 1 April 2005 4,128 51,879 90,256 4,047 4,141,390
Retained profit the period 264,830
Bonus issue 49,536 (49,536)
Issue of shares 11,904 1,988,096
Costs of share issue (192,044)
Revaluation of investments
Translation differences on
foreign currency net investments
in subsidiary undertakings 69,049
________ ________ ________ ________ ________
At 30 September 2005 65,568 1,847,931 90,256 4,047 4,425,733
WATERLINE GROUP PLC
Notes forming part of the interim report for the six months ended 30 September
2005 (Continued)
5 Acquisition of Coolectric Limited
The interim report includes a cost of acquisition for Coolectric Limited of
#1,109,076. This is based on the draft completion accounts which are yet to be
formally agreed by both parties. The directors do not anticipate any material
change to this figure on finalisation of the completion accounts.
6 Reconciliation of operating profit to net cash inflow from operating
activities
30 September 31 March
2005 2005
(unaudited) (audited)
# #
Operating profit 948,337 1,601,121
Depreciation 361,032 693,227
Amortisation 29,046 57,244
Loss on sale of fixed assets 29,235 35,631
Currency translation differences 47,104 (27,919)
Increase in stocks (619,987) (836,087)
Decrease in debtors 1,273,523 309,471
Increase/(decrease) in creditors 619,778 (613,339)
________ ________
Net cash inflow from operating activities 2,688,068 1,219,349
7 Reconciliation of net cash inflow to movement in net debt
30 September 30 September 31 March 31 March
2005 2005 2005 2005
(unaudited) (unaudited) (audited) (audited)
# # # #
Increase/(decrease) in cash in the year 3,104,905 (854,577)
Cash movements relating to debt 157,951 299,051
Capital element of hire purchase and
finance lease rentals 238,867 370,293
________ _________
Change in net debt resulting from cash flows 3,501,722 (185,233)
New finance leases (312,539) (376,245)
________ ________
Movement in net debt in the year 3,189,184 (561,478)
Opening net debt (6,002,427) (5,440,949)
________ ________
Closing net debt (2,813,243) (6,002,427)
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