Final Results
26 June 2003 - 5:00PM
UK Regulatory
RNS Number:7854M
Conder Environmental PLC
26 June 2003
Preliminary Announcement - Conder Environmental plc - 26 June 2003
Chairman's statement - year ended 30 April 2003
Trading performance across all parts of the group has continued to improve
during the second half of the year ended 30 April 2003. This has enabled the
Group to meet its profit targets, and propose a maiden dividend.
Trading results
Profit before tax for the year was #560,000 (2002: loss #1,281,000) on turnover
of #21.8 million (2002: #14.6 million). This follows a profit for the first half
of the year of #12,000.
Basic earnings per share were 1.1p (2002: loss per share 3.2p). As there were no
exceptional items, adjusted earnings per share were also 1.1p (2002: adjusted
loss per share 3.4p).
While all the businesses in the group contributed to the improvement in
performance, Vikoma enjoyed an exceptional year, underpinned by two substantial
contracts for Brazil.
The performance of Conder Products strengthened steadily through the year, with
increasing sales and significantly better margins as greater production
efficiencies and other cost savings were achieved. As a result the losses of the
tanks business at Peterlee have steadily diminished, and this business made a
small profit in the final quarter; improvements have continued in the current
year. Our smaller packaged sewage treatment plants have sold particularly well
and we have now introduced new products extending this range to larger
applications.
The volume of sales in Cerva has also increased as the year has progressed. This
business made its first, albeit modest, profit in the final quarter. The
National Grid contract is now operating well and has two more years to run.
Dividend
A maiden dividend of 0.5p per share is proposed. Subject to shareholder approval
this will be paid on 8 August 2003, to shareholders on the register at 11 July
2003.
Financial resources
Net borrowings at 30 April 2003 were just #250,000 (2002: #821,000), a gearing
level of 4%.
Future strategy
Our strategy for Vikoma remains broadly unchanged: its markets are relatively
mature, but cyclical, and the key to continued success is to retain our world
leader status through having the best distribution network, controlling costs
and continuing product innovation.
Further improvements at Conder Products, including its Sewage Technology
division, will come from the new sewage treatment plant range we have recently
introduced; we believe these products provide us with a much more competitive
range for larger schemes than we have had hitherto. This is in addition to our
continued focus on value engineering and other cost reduction.
In addition to our plans for organic sales and profit growth, we are now
actively seeking acquisition opportunities which will prove a natural fit with
our existing suite of environmental products and services, and which we believe
have the potential to increase earnings per share.
Staff
The steady improvement in your group's fortunes is in large part attributable
not to any single dramatic development but to an attention to a large number of
simple things: cost control, cost efficiency, and focus on the market place.
Without the dedication of our staff in all parts of the group this achievement
would not have been possible, and I thank them for their energy and commitment.
Outlook
It would be unrealistic to budget for Vikoma to match the exceptional results it
achieved in the year under review, albeit that prospects in its markets remain
strong and we expect a satisfactory year. Continuing improvements in trading
performance at Conder Products, and a further robust performance from Vikoma,
give your board the confidence to expect current year profits to show further
growth for the group as a whole. Furthermore we expect that this profitability
will be more broadly based across all our businesses than has been the case in
recent years.
Mike Killingley
25 June 2003
Consolidated profit and loss account
for the year ended 30 April 2003
2003 2002
#000 #000
Turnover 21,822 14,648
Operating costs (21,150) (16,101)
Operating profit / (loss) 672 (1,453)
Interest receivable 2 13
Interest payable and similar charges (114) (128)
Profit on disposal of fixed assets - 287
Profit / (loss) on ordinary activities
before taxation 560 (1,281)
Tax on profit/(loss) on ordinary (201) 57
activities
Profit / (loss) on ordinary activities 359 (1,224)
after taxation
Minority interest - equity 36 44
Profit for the financial year 395 (1,180)
Dividends (186) -
Retained profit / (loss) for the year 209 (1,180)
Basic earnings/(loss) per share 1.1p (3.2p)
Diluted earnings/(loss) per share 1.1p (3.2p)
Adjusted basic earnings/(loss) per share 1.1p (3.4p)
All amounts relate to continuing operations. In both the current and previous
financial years, the Group had no recognised gains and losses other than those
passing through the profit and loss account.
Consolidated balance sheet
at 30 April 2003
2003 2002
#000 #000 #000 #000
Fixed assets
Intangible assets 2,113 2,311
Tangible assets 2,103 1,903
4,216 4,214
Current assets
Stocks 1,464 1,418
Debtors 5,064 3,798
Cash at bank and in hand 488 238
7,016 5,454
Creditors: amounts falling due within one year (4,625) (2,983)
Net current assets 2,391 2,471
Total assets less current liabilities 6,607 6,685
Creditors: amounts falling due after more than
one year (439) (689)
Provisions for liabilities and charges - (1)
Net assets 6,168 5,995
Capital and reserves
Called up share capital 3,725 3,725
Share premium account 3,897 3,897
Merger account (644) (644)
Profit and loss account (730) (939)
Equity shareholders' funds 6,248 6,039
Minority interest - equity interest (80) (44)
6,168 5,995
Consolidated cash flow statement
for the year ended 30 April 2003
2003 2002
#000 #000
Net cash inflow from operating activities 1,296 467
Returns on investments and servicing of finance (112) (97)
Taxation - 192
Capital expenditure (613) (209)
______ ______
Cash inflow before management of liquid
resources and financing 571 353
Financing (321) (305)
______ ______
Increase in cash in the year 250 48
______ ______
Notes on the Accounts
1. Segmental analysis
All turnover arose in the United Kingdom and is analysed by destination as
follows:
2003 2002
#000 #000
United Kingdom 8,394 8,062
Continental Europe 1,429 406
North America 799 1,706
South America 8,462 1,299
Rest of World 2,738 3,175
______ ______
21,822 14,648
______ ______
The table below sets out information for each of the group's industry
segments.
Vikoma Conder Products and Total
Cerva
2003 2002 2003 2002 2003 2002
#000 #000 #000 #000 #000 #000
Turnover 13,766 7,244 8,056 7,404 21,822 14,648
______ ______ ______ ______ ______ ______
Net assets
Segment net assets 1,953 2,459 5,625 4,464 7,578 6,923
______ ______ ______ ______ ______ ______
Unallocated net (1,410) (928)
liabilities ______ ______
Total net assets 6,168 5,995
liabilities ______ ______
Vikoma operates in a global market, whilst the remaining trade is based in
the UK, therefore a separate geographical market analysis would not be
meaningful and has not been presented.
Certain disclosures required by Statement of Standard Accounting Practice
25 (Segmental Reporting) have not been made because, in the opinion of the
directors, such disclosure would be seriously prejudicial to the interests
of the Group.
2. Earnings/(loss) per ordinary share
Basic earnings per share for the year ended 30 April 2003 has been
calculated based upon the weighted average number of ordinary shares in
issue for the year of 37,254,309 (2002: 37,254,309) and profit after
taxation and minority interest of #395,000 (2002: loss #1,180,000).
The weighted average number of shares used in the calculations of diluted
earnings per share is 37,278,067 calculated as follows:
2003
Number
Basic weighted average number of shares 37,254,309
Dilutive potential ordinary shares: employee share options 23,758
__________
37,278,067
__________
In 2002 diluted loss per share was restricted to 3.2p, as it is not
permitted to exceed basic loss per share.
3. Dividends
2003 2002
#000 #000
Proposed final dividend of 0.5p (2002: #Nil) per share 186 -
____ ____
4. Reconciliation of net cash flow to movement in net debt
2003 2002
#000 #000
Increase in cash in the year 250 48
Repayment of bank loan 250 227
Cash outflow from lease financing 71 78
_____ _____
Change in net debt resulting from cash flows and movement in net debt
in the year 571 353
Net debt at beginning of year (821) (1,174)
_____ _____
Net debt at end of year (250) (821)
_____ _____
5. Analysis of net debt
At 1 May Cash flow Other non-cash At 30 April
2002 flows 2003
#000 #000 #000 #000
Cash at bank and in hand 238 250 - 488
_____ _____ _____ _____
238 250 - 488
Debt due within one year (250) 250 (250) (250)
Debt due after one year (689) - 250 (439)
Finance leases (120) 71 - (49)
_____ _____ _____ _____
Total (821) 571 - (250)
_____ _____ _____ _____
6. Financial information
The financial information set out above does not constitute statutory
accounts within the meaning of Section 254 of the Companies Act 1985 for
the years ended 30 April 2003 and 2002 but is derived from the Group's
audited accounts which have been approved and signed by the directors.
Statutory accounts for 2002 have been delivered to the Registrar of
Companies, and those for 2003 will be delivered following the Group's
Annual General Meeting. The auditors have reported on those accounts; their
reports were unqualified and did not contain statements under either
Section 237(2) or 237(3) of the Companies Act 1985.
7. Report and Accounts
Copies of the Report and Accounts will be sent to shareholders and the AIM
team. Copies will be available to the public for one month, from the
Group's Registered Office at 21/22, Britannia Chambers, Town Quay,
Southampton SO14 2AQ and from the Company's nominated adviser Teather &
Greenwood Limited at Beaufort House, 15 St. Botolph Street, London EC3A
7QR.
This information is provided by RNS
The company news service from the London Stock Exchange
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FR SEWFMISDSEIM
