RNS Number:6056K
Shiloh PLC
01 May 2003
1 May 2003
SHILOH PLC
("Shiloh" or "the Group")
Preliminary Results for the year ended 31 March 2003
Shiloh PLC, the Oldham based healthcare company, announces preliminary results
for the year ended 31 March 2003.
Full Year Full Year
2003 2002
Turnover #45.44m #39.93m
Like for like sales* #42.0m #37.0m
Operating profit before exceptional items and amortisation #1.23m #1.35m
Profit before tax #0.49m #0.82m
Earnings per share 4.6p 7.9p
Dividend per share
- final 3.85p 3.70p
- total 5.35p 5.20p
* adjusted for the acquisitions made shortly before the start of the year and
for the loss of the disposable surgical instruments business in England
* On a like for like basis*, operating profit increased by 56% to #1.1
million (2002: #0.7 million)
* Gross profit as a percentage of sales increased to 27.4% (2002: 26.1%)
* Operating cash inflow before exceptional items of #1.8 million (2002:
#1.6 million)
* Total dividend increased to 5.35p (2002: 5.20p)
* Business restructured into three divisions - Medical, Active Care and
Sterilisation Services
* Strengthened operational management team
* Good progress on new product launches during the year
- Comfi range of tubular bandages
- Sahara range of washable continence care products
- Conti range of nelaton catheters and urine drainage bags
- Acquisition of Clinisan emollient cleansing foam
* Appointment of Robert Hough as a Non-Executive Director
Commenting on the outlook for the year, Edmund Gartside, Chairman, said:
"During the year, we have made much progress in changing the shape of the Group
and are now in a strong position to move forward and enjoy the benefits arising
from these changes. We believe we are now better placed than ever before to
develop further the business both organically and through acquisition".
For further information please contact:
Shiloh PLC
Edmund Gartside, Chairman 0161 785 3492
Graham Collyer, Chief Executive 0161 785 3420
John Edwards, Finance Director 0161 785 3420
Weber Shandwick Square Mile
Louise Robson or Cass Helstrip 020 7067 0700
1 May 2003
SHILOH PLC
("Shiloh" or "the Group")
Preliminary Results for the year ended 31 March 2003
In a year of significant change within the Group, the results for the full year
are broadly in line with our expectations when we announced the interim results.
Financial Results
Group sales for the year were #45.44 million compared with #39.93 million last
year, an increase of 14%. As indicated at the half year, the loss of the
disposable surgical instruments sales to the English health authorities,
following a reversion to reusable instruments, affected turnover this year and
comparisons with last year. Like for like sales, adjusted for the acquisitions
made shortly before the start of the year and for the loss of the disposable
surgical instruments business, increased by 12.5% to #42.0 million from #37.0
million in 2002.
Gross profit as a percentage of sales increased from 26.1% to 27.4%, reflecting
the improving margins within the business, despite the adverse impact of the
strengthening Euro in the second half.
Operating profits before exceptional items were #1.23 million (2002: #1.35
million). On a like for like basis, operating profits before exceptional items
increased by 56% to #1.1 million from #0.7 million in 2002.
Exceptional charges were less than anticipated at the interim results and
totalled #395,000 for the year. These non-recurring costs comprised #23,000 on
aborted corporate transactions, #301,000 on organisational restructuring and
#71,000 pension top up payments. However, the anticipated exceptional gains from
property disposals did not materialise as the sales were not completed within
the financial year. We are confident that these sales will be achieved during
the current financial year and will generate circa #1.9 million cash net of
costs.
Profit before tax was #490,000 (2002: #817,000), resulting in earnings per share
of 4.6p (2002: 7.9p).
Cash flow was a key focus for the Group during the year, resulting in a strong
operating cash inflow before exceptional items of #1.8 million (2002: #1.6
million).
Dividend
A final dividend of 3.85p is being recommended, which represents a 4% increase
over last year. This makes a total dividend for the year of 5.35p (2002:
5.20p). The final dividend, if approved, will be payable on 19 June 2003 to
shareholders on the register on 30 May 2003.
Review of Operations
During the year, we have restructured the business into three divisions -
Medical, Active Care and Sterilisation Services - to enable the Group to be
understood more easily and to ensure that it is appropriately structured to
support future growth.
Medical
This division is focused primarily on disposable products for use within the NHS
and the private healthcare sector. It provides product and service solutions in
the areas of continence care, infection prevention and wound management.
Divisional sales were #33.3 million, up from #29.9 million, an increase of
11.4%. Within the division we saw another strong performance from our Scottish
distribution business, Fast-Aid Products, whilst Macdonald & Taylor, our cotton
wool business, delivered a good set of results despite difficult trading
conditions.
Shiloh Healthcare, comprising the continence care, infection prevention and
wound management businesses, has been brought together under a newly appointed
subsidiary Managing Director, Gerry Hay.
Our focus during the year has been on internal development supported by
acquisition. Key initiatives during the year were:
* the introduction in August 2002 of the Comfi range of tubular bandages
* the introduction in October 2002 of the new Sahara range of washable
continence care products
* the introduction in November 2002 of the Conti range of nelaton
catheters and urine drainage bags
* the acquisition in February 2003 of the Clinisan emollient cleansing
foam
Another area of focus was home delivery, where we have improved operational
efficiency and commenced the process of standardising our IT offering, Shiloh
Connect.
During the year we withdrew from certain low margin protective clothing
businesses to concentrate on our own brand, Primeguard.
Since the year-end, the sales force has been reorganised so that even more focus
is devoted to the higher margin products.
Active Care
This division supplies and maintains a comprehensive range of mobility and
rehabilitation equipment across the UK. The range includes wheelchairs,
scooters, hoists, slings, stair lifts, ramps, chairs, beds and general aids for
daily living.
Division sales were #10.0 million, up from #6.1 million, an increase of 63.8%.
Of this increase, #2.9 million (45%) was as a result of the acquisition of Care
& Mobility in March 2002, just before the end of the previous financial year.
The four companies we acquired between 2000 and 2002 are now being brought
together under one brand, Shiloh Active Care. With the appointment of a
Managing Director, Steve Dootson, and the recruitment of an experienced sector
marketing specialist, we expect significant organic growth from this Division as
we position ourselves as one of the largest players in this extensive and fast
growing market.
During the year we signed two exclusive UK distribution agreements which reflect
our strong position within the market. In May 2002, we signed an agreement with
Sumed International UK Ltd for bespoke seating and heavy duty wheelchairs and,
in December 2002, with Roho Inc for the Roho brand of dry flotation products. We
anticipate significant growth from these products in the year ahead.
Our first acquisition in this sector, ICR Mobility, which is based in Bootle,
Stoke, Cardiff and Ringwood, performed strongly during the year. However, our
northern units (Hunters and Lakesway) encountered tougher trading conditions.
These businesses are far more reliant on private purchases, which are heavily
influenced by general economic conditions, rather than contract purchases by the
NHS or Social Services. The Sumed and Roho agreements will shift our divisional
sales mix away from private sales to more contract-orientated business.
In the year ahead we will focus on deriving benefit from the new branding and
from our purchasing strength.
Sterilisation Services
This division was established as a new concept for the decontamination of
surgical instruments in the private sector. It operates from custom-built
sterilisation facilities at Strathclyde Business Park, Lanarkshire, supporting
hospitals across central Scotland.
In April 2002, we acquired the minority shareholding in Trust Sterile Services
Ltd enabling us to fully integrate this company as one of our three key
divisions. The base business performed well with sales of #2.2 million. The loss
of the disposable tonsillectomy business had an adverse effect on the division
and the Group as a whole and the lack of sales of reusable instruments from our
inclusion in the national contract has been a disappointment, albeit recognising
that the industry as a whole has had similar frustrations.
We await news from the Department of Health as to how sterilisation instrument
services within the NHS are to be upgraded and remain confident that this
initiative will result in significant opportunities for us to develop new sites.
Accordingly we have split the responsibilities of the two founders of this
business. Isobel Kelly has been appointed Managing Director, Sterilisation
Services and Gerry Heneaghan has been appointed Projects Director, Shiloh Group
and will focus on the development of new business and sites.
Strategy
Our aim is to develop innovative, long-term mutually-beneficial partnerships
with healthcare providers in the supply of continence care, mobility, and
rehabilitation, prevention of infection and wound management. Partnerships that
will add value through the supply, distribution and brand development of the
products and services we provide.
The Group has traditionally operated in low margin healthcare sectors, which
demand high level of overhead expenditure due to the high service levels
expected by our key customers. Our focus during the year has been on higher
margin branded products and services either through internal development or
acquisition.
Our intention is to grow all three business areas organically. However, within
Medical we also plan to make strategic acquisitions combined with organic
growth. In addition, we will dispose of, or discontinue where appropriate,
certain areas of our business which have lower margins.
We will continue to focus on strong operating cash flow generation which will,
in part, help to finance any future acquisitions.
Management
The year has been one in which we have introduced significant changes to people,
to products and to culture and, as a result, have spent considerable time and
effort during the year restructuring the Group and preparing it for the future.
Two directors left the Group during the year. Mark Lewis, Managing Director of
the Healthcare division resigned and Lincoln Jones, Managing Director of Shiloh
Healthcare retired. We would like to thank both for their contribution to the
Group over the years.
The other main change was the appointment of Graham Collyer as Chief Executive
on 1 January 2003. Graham brought with him a wealth of experience of the
healthcare industry and considerable knowledge and expertise of the markets in
which we operate.
Announced today, Robert Hough joins the Board as a Non-Executive Director.
Robert currently holds a number non-executive directorships, including as Deputy
Chairman of Peel Holdings plc, Chairman of Liverpool Airport plc, a
Non-Executive Director of Alfred McAlpine plc and a Non-Executive Director of
the Cheshire Building Society.
Darrell Shaw, currently Senior Independent Non-Executive Director, has announced
that he will retire from the Board immediately after the Annual General Meeting
on 17 June 2003. We would like to thank Darrell for his considerable
contribution over many years.
At the operating level, as well as strengthening our Human Resources and
Information Technology functions, we have made key appointments in the areas of:
* Pricing, contract negotiation, and customer services with the
appointment of Bernard Braiden as Director of Commercial Services
* Purchasing and planning - Joe Mitchell as Director of Procurement
* Manufacturing - Garry Wilson as Director of Manufacturing
These appointments, as well as the others mentioned within the divisional
review, are key to the future development of the business. Together, they bring
more than 100 years of experience in relevant fields of the healthcare industry.
Outlook
During the year, we have made much progress in changing the shape of the Group
and are now in a strong position to move forward and enjoy the benefits arising
from these changes. We believe we are now better placed than ever before to
develop further the business both organically and through acquisition.
For further information, please contact:
Shiloh PLC
Edmund Gartside, Chairman 0161 785 3492
Graham Collyer, Chief Executive 0161 785 3420
John Edwards, Finance Director 0161 785 3420
Weber Shandwick Square Mile
Louise Robson or Cass Helstrip 020 7067 0700
Shiloh PLC
Consolidated Profit and Loss Account
For the year ended 31 March 2003
2003 2002
Ordinary Amortisation Total Total
Activities and Exceptional
Items
#000's #000's #000's #000's
Turnover 45,441 - 45,441 39,927
Cost of sales (32,997) - (32,997) (29,500)
Gross profit 12,444 - 12,444 10,427
Net operating expenses (11,214) (395) (11,609) (9,078)
Operating profit before
amortisation of intangible assets 1,230 (395) 835 1,349
Amortisation of intangible assets - (223) (223) (134)
Operating profit after
amortisation of intangible assets 1,230 (618) 612 1,215
Loss on sale of
previously discontinued operations - - - (338)
Profit on ordinary activities
before interest 1,230 (618) 612 877
Net interest payable (122) - (122) (60)
Profit on ordinary activities
before taxation 1,108 (618) 490 817
Taxation (301) 119 (182) (227)
Profit after taxation 807 (499) 308 590
Minority interests - equity - - - (71)
Profit attributable to ordinary
shareholders 807 (499) 308 519
Dividends (358) - (358) (342)
Retained (loss)/ profit for the year 449 (499) (50) 177
Earnings per share before amortisation of
intangible assets and exceptional items
Basic 12.13p 15.13p
Diluted 11.93p 14.89p
Earnings per share
Basic 4.62p 7.92p
Diluted 4.55p 7.79p
Shiloh PLC
Consolidated Balance Sheet
At 31 At 3
March March
2003 2002
#000's #000's
FIXED ASSETS
Intangible assets 5,393 3,952
Tangible assets 5,509 5,750
10,902 9,702
CURRENT ASSETS
Stocks 5,754 4,967
Assets held for re-sale 776 -
Debtors 7,842 7,307
Short term deposits 450 450
Cash at bank and in hand 297 240
15,119 12,964
CURRENT LIABILITIES
Creditors 11,847 8,667
NET CURRENT ASSETS 3,272 4,297
TOTAL ASSETS LESS CURRENT LIABILITIES 14,174 13,999
LIABILITIES FALLING DUE AFTER ONE YEAR
Creditors 1,592 1,478
PROVISION FOR LIABILITIES AND CHARGES 294 210
DEFERRED CREDITOR 111 117
12,177 12,194
CAPITAL AND RESERVES
Called up share capital 1,672 1,652
Share premium account 1,273 1,140
Capital redemption reserve 62 62
Revaluation reserve 802 967
Profit and loss account 8,368 8,403
EQUITY SHAREHOLDERS' FUNDS 12,177 12,224
EQUITY MINORITY INTERESTS - -30
12,177 12,194
Shiloh PLC
Consolidated Cash Flow Statement
For the year ended 31 March 2003
2003 2002
#000's #000's
NET CASH INFLOW FROM OPERATING ACTIVITIES
Operating profit 612 1,215
Depreciation 878 715
Amortisation of intangible fixed assets 223 134
Profit on sale of tangible fixed assets (3) (5)
Government grant released to profit and loss account (6) (6)
Increase in stocks (787) (139)
Increase in debtors (560) (1,403)
Increase in creditors 1,075 1,106
1,432 1,617
RETURNS ON INVESTMENTS
AND SERVICING OF FINANCE (118) (8)
TAXATION (299) (388)
CAPITAL EXPENDITURE (1,901) (789)
ACQUISITIONS AND DISPOSALS (460) (2,830)
EQUITY DIVIDENDS PAID (345) (326)
MANAGEMENT OF LIQUID RESOURCES - 3,894
FINANCING (162) (1,328)
DECREASE IN CASH (1,853) (158)
Analysis of changes in net debt
At 31st Other At 31st
March Cash non cash March
2002 Flow changes 2003
#000's #000's #000's #000's
Cash at bank and in hand 240 57 - 297
Bank overdraft (341) (1,910) - (2,251)
(101) (1,853) - (1,954)
Debt due after one year (450) - 450 -
Finance leases (621) 195 (412) (838)
Short term deposits 450 - - 450
(722) (1,658) 38 (2,342)
Shiloh PLC
Notes to the Accounts
This preliminary results statement was approved by the Board of Directors on 1
May 2003. The above results for the year ended 31 March 2003 have been abridged
from the full Group accounts for that year, which received an unqualified
auditors' report and which will be delivered to the Registrar of Companies
shortly.
The above results for the year ended 31 March 2002 have been abridged from the
full Group accounts for that year, which received an unqualified auditors'
report and which have been delivered to the Registrar of Companies.
The Annual Report and Financial Statements will be posted to shareholders as
soon as practicable. Further copies will be available from the company's
registered office at Shiloh House, Fitton Street, Royton, Oldham, OL2 5JX.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR SDSESSSDSELL