Delaney Group PLC - Final Results
01 July 1997 - 5:30PM
UK Regulatory
RNS NO 7328V
DELANEY GROUP PLC
1st July 1997
Delaney Group plc - Chairman's Statement
Financial Review
I am very disappointed to have to report a significant loss again
for the year ended 31 December 1996.
I reported at the interim stage that the final quarter of 1996
was likely to be critical to the overall outcome for the year as
a whole. In the event trading remained extremely difficult and
on top of this we identified serious discrepancies in the
management accounts in late October 1996. We have now had the
opportunity to review the situation and we have found that our
internal control procedures relating to stock and cost control at
Christies Panel Products Limited in general had broken down.
We have now taken action to re-establish these controls by the
appointment of some key new senior and middle management.
As a result the Group incurred a loss of #739,000 before tax, but
this was after crediting to the profit and loss account an amount
of #913,000 resulting from a review of the asset lives of plant
held within the group. The loss of #739,000 compares with a loss
before tax in 1995 of #511,000. Turnover increased by 15% to
#21,798,000 from #18,911,000 last year. Without this
exceptional credit of #913,000 the loss for the year would be
#1,652,000.
Overall these results are extremely disappointing.
In view of the results your Board will not be recommending the
payment of a dividend.
On the issue of funding, you will read from the accounts that my
private company Melton Medes Limited has had to make available to
the Group significant funds during the year and since the year
end. Further funding is likely to be required and I am working
on formalising this. Our auditors' report will be qualified in
relation to this future funding.
Trading Review
Order intake at Christies Panel Products, the main operating
subsidiary, was much improved in the period resulting in
increased turnover of #21.8 million, compared with #18.9 million
in the previous period. Increased demand resulted in many
inefficiencies and problems. The manufacturing and installation
operations had to be reorganised to meet the increased demands.
Changes have been put in place since the year end which will help
to mitigate the capacity problems in the manufacturing area.
Management
During the year various changes took place in the management at
Christies Panel Products, some had been previous announced. John
McFarnon left in September 1996 and Stuart Clarke in October 1996
both as directors of Christies Panel Products as well as Delaney
Group plc. Bob Hollick was promoted to the Managing Director's
position of Christies Panel Products Limited from 1 October 1996.
In December 1996, Livingstone Brown was appointed Manufacturing
Director at Christies Panel Products. He has helped to reduce
many of the problems which previously existed. On 24 June 1997
Anil Puri was appointed as Operations Director of Delaney Group
plc.
Prospects
The difficulties which started in 1996 have taken time to
resolve. Some redundancies had to be implemented this month with
more to follow. 1997 figures will show a loss for the year. The
business is being refocused to run at a lower level of activity,
with a view to return it to profitability in 1998. Your Board is
doing everything possible within the limited resources available
to achieve these ends. In the meantime Delaney Group continues
to rely on the support of my private company Melton Medes Limited
for its continuance. I thank you for your patience.
Nathu Puri
Chairman
DELANEY GROUP PLC
PRELIMINARY GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 December 1996
1996 1995
#'000 #'000 #'000 #'000
Turnover-continuing operations 21,798 18,911
Operating loss-continuing operations before (1,292) (739)
exceptional credit
Exceptional credit arising on asset 913 -
relifing
Operating loss on continuing operations (379) (739)
Discontinued business segments - 387
Loss on ordinary activities before interest (379) (352)
Interest receivable and similar income - 5
Interest payable and similar charges (360) (360) (159)
(164)
Loss on ordinary activities before taxation (739) (511)
Taxation (8) -
Loss on ordinary activities after taxation (747) (511)
Dividend proposed - -
Loss for the financial year (747) (511)
Loss per ordinary share of 2p (0.5p)
(0.7p)
Dividend per ordinary share of 2p -p -p
Notes:
1. All activities are continuing operations
2. Earnings per ordinary share are calculated on a share
capital of 107,062,554 ordinary shares of 2p each.
3. The accounts have been drawn up on a going concern basis
which is dependent on continuing financial support from
Melton Medes Limited, a private company controlled by the
Chairman, Mr N Puri. The provision of this support is
subject to shareholders' approval.
In view of the limited information available in relation to
the formalisation of future funding, the auditors' report
will be appropriately qualified.
4. The results set out above are not full accounts as defined
in Section 240 of the Companies Act 1985. The auditors
have not yet made a report under Section 235 of the
Companies Act 1985 on the accounts for the year ended 31
December 1996 from which results are extracted and
consequently full accounts for the period have not yet been
delivered to the Registrar of Companies.
5. The results for the year ended 31 December 1995 are
abridged from the statutory accounts for that year which
have been delivered to the Registrar of Companies.
END
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