TIDMBILB
RNS Number : 0184H
Bilby PLC
01 December 2020
1 December 2020
Bilby Plc
("Bilby" or the "Group")
Half Year results for the six months ended 30 September 2020
Bilby Plc (AIM:BILB), a leading gas heating, electrical and
building services provider, announces its half year results for the
six months ended 30 September 2020 (the "Period").
Unaudited Unaudited Audited
6 months 6 months 12 months
to to to
30 September 30 September 31 March
2020 2019 2020
GBP 000 GBP 000 GBP 000
----------------------------------------- -------------- -------------- -----------
Income statement
Revenue 23,432 29,778 65,392
Gross profit 5,994 7,819 16,597
EBITDA(1) (including effect of adoption
of IFRS 16) 1,924 2,450 5,508
Adjusted EBITDA(2) (excluding effect
of adoption of IFRS 16) 1,523 2,062 4,668
Underlying operating profit(3) 1,408 1,917 4,256
Underlying profit before taxation(4) 1,160 1,702 3,691
(Loss)/profit after taxation (155) 542 1,379
Basic (loss)/earnings per share(5) (0.26) 1.34 2.93
Adjusted earnings per share(6) 1.92 3.78 7.10
----------------------------------------- -------------- -------------- -----------
Financial position and cash flow
generation
Net (cash)/overdraft (2,465) 6,292 3,332
Term and other loans 7,325 4,776 3,882
Net debt(7) 4,860 11,068 7,214
Net cash generated from operating
activities 3,004 1,017 3,886
Adjusted net cash generated from
operating activities(8) 1,882 2,409 4,604
Adjusted operating cash conversion(9)
(%) 124% 117% 99%
Net assets 10,487 7,941 10,624
----------------------------------------- -------------- -------------- -----------
1. Earnings before interest, taxation, depreciation and
amortisation ("EBITDA") and excluding non-underlying items as set
out in the financial review.
2. EBITDA, excluding non-underlying items and before the effect
of the implementation of IFRS 16 "Leases" as set out in the
financial review.
3. Underlying operating profit is stated before charging
non-underlying items as set out in note 3.
4. Underlying profit before taxation is stated after finance
costs and before charging non-underlying items as set out in the
financial review.
5. Basic (loss)/earnings per share is the (loss)/profit after
tax divided by the weighted average number of ordinary shares.
6. Adjusted earnings per share is the profit before deducting
non-underlying after tax divided by the weighted average number of
ordinary shares.
7. Net debt comprises term loans and other loans, and cash net
of overdraft, and excludes lease obligations under IFRS 16.
8. Net cash generated from operating activities after adjustment
for exceptional payments and deferred HMRC payments and before the
effect of the implementation of IFRS 16, as set out in the
financial review.
9. Adjusted net cash generated from operating activities divided
by Adjusted EBITDA, as set out in the financial review
Financial highlights
-- Adjusted EBITDA of GBP1.5 million (2019: GBP2.1 million) for
the six month period ended 30 September 2020; illustrating Covid-19
resilience, with run rate at 74% of prior year.
-- Q2 revenues increased 54% from Q1 (2019: 5% increase),
demonstrating work being deferred not lost due to Covid-19.
-- Strong Adjusted cash generation of GBP1.9 million
representing an Adjusted operating cash conversion of 124%.
-- Net debt reduced 33% by GBP2.3 million from GBP7.2 million at
31 March 2020 to GBP4.9 million at 30 September 2020.
-- Net cash at 30 September 2020 of GBP2.5 million giving GBP5.0
million headroom against overdraft facility of GBP2.5 million.
Operating highlights
-- Our three year visible revenues* increased from GBP172.1
million to GBP182.4 million during the Period due to a combination
of new, renewed and extended contracts.
-- With client resources limited due to the lockdown, our
consistent and continuous presence enabled the opportunity to
capture a broader range of work streams.
-- Significant efficiencies achieved through realignment of
internal functions and office consolidation, enabling reinvestment
for growth.
-- Internal investment to drive further improvements in working
capital through operational excellence.
-- Investment in additional green accreditations to continue our focus on sustainability.
* Three year visible revenues represents the minimum
identifiable revenues, over the following three year period; being
contracted or anticipated spend as well as historical run
rates.
Post-period end
-- Investment to strengthen and enhance Bilby's business
development team in order to capture organic growth
opportunities.
-- Further investment committed to diversify and prioritise our
focus on in-house compliance and regulatory work streams.
-- Strengthened the board with the appointment of Caroline
Tolhurst as a Non-Executive Director.
-- Current trading continues robustly but until the duration and
subsequent implications of the continuing Government's restrictions
become clear, it remains difficult for the Company to provide
financial guidance for the current year. We will continue to keep
the market updated as the situation evolves.
Commenting on the results and prospects, David Bullen, Chief
Executive Officer, said:
"The challenges of the Covid-19 pandemic continue to test the
resilience of all companies, particularly those that involve close
human contact in the work place such as Bilby. However, these
challenges have served to demonstrate our renewed strength and
vigour, whilst the realignment of our cost base during the Period
has facilitated the opportunity to reinvest in foundational
building blocks for our future. Much uncertainty still remains as a
result of the pandemic but we look ahead positively with confidence
as Bilby continues its transition from the past difficulties to
deliver long term sustainable growth."
This announcement contains information which, prior to its
disclosure by this announcement, was inside information for the
purposes of the Market Abuse Regulation
For further information please
contact:
Bilby Plc
Sangita Shah, Chair +44 (0)20 7796 4133
David Bullen, Chief Executive (via Hudson Sandler)
Officer
Canaccord Genuity Limited
(Nominated Adviser and Sole
Broker) +44 (0)20 7523 8000
Corporate Broking:
Bobbie Hilliam
Andrew Potts
Georgina McCooke
Sales:
Jonathan Barr
Hudson Sandler (Financial
PR) +44 (0)20 7796 4133
Charlie Jack
Bertie Berger
Notes to Editors:
Bilby is a leading provider of essential electrical, gas and
building services to communities across London and the South
East.
The Group was formed in 2014 with a strategy of acquiring
businesses to meet the continued demand for high-quality
improvement and maintenance services in public sector and
affordable housing. Bilby's reputation for operational excellence
is underpinned by its disciplined focus on customer service.
There are four subsidiaries within the Bilby Group:
-- Purdy, an award-winning contractor in electrical, mechanical and property services;
-- DCB (Kent), a high-quality building, refurbishment and maintenance services provider;
-- Spokemead, a specialist in electrical installation, repairs and maintenance services; and
-- R. Dunham, a provider of electrical installation and maintenance services.
Bilby Plc is listed on the AIM market of the London Stock
Exchange
Chair's statement
Despite the significant challenges of operating during the
national lockdown and the restrictive period of uncertainty which
has followed, the Group delivered a strong performance for the
first half of the year. Essential work, as deemed by the UK
government, is very much at the heart of the services Bilby
provides - given the regulatory and compliant natures of the
maintenance and repairs we undertake. Whilst the Group was impacted
by work place access issues, the Group's performance was
attributable to management's proactive and decisive actions which
mitigated disruption. The Group quickly implemented the operational
measures to ensure we could continue to serve our customers safely
as an essential service provider with the dedication and passion
that is the hallmark of Bilby.
The resilient performance is a testament to the exceptional work
done by the team, spearheaded by David Bullen, in restructuring the
Group. This turnaround work has led to a significant reduction in
net debt and strong cash generation. Importantly the latter stages
of the restructuring, which coincided with the outbreak of the
Covid-19 pandemic, saw the Group take further action to realign
certain key group functions. Bilby is now better-placed to tender
for the right contracts, whilst executing its services with high
levels of customer satisfaction whilst protecting margins.
Importantly we now have sustainable internal platforms and systems
providing transparency throughout the organisation. These monitor
efficiencies and ensure our people have the opportunity to maximise
their potential.
As part of our ongoing efforts to enhance governance throughout
the organisation, we announced post the Period-end the appointment
of Caroline Tolhurst as a Non-Executive Director, in line with best
corporate governance practice.
The varying regional restrictions imposed as a result of
Covid-19 has made the timing of certain customer work streams and
associated revenues challenging to predict for the remainder of the
financial year. However, having navigated successfully the
considerable operational challenges full lockdown presented, and
with growing nationwide acceptance of the positive impact a vaccine
will offer, the Company is in a strong position to take advantage
as normal market conditions return. The Directors are also focussed
on re-instating market guidance as the business stabilises both
internally and in the external market place and, once balance sheet
strength is achieved, re-instating a dividend.
At such a challenging time of huge uncertainty and disruption,
all those at Bilby have continued to assiduously work with
unstinting dedication and commitment that is at the very hub of our
continued recovery and success. Our solid half year results are a
testimony to their efforts and I would like to personally extend my
heartfelt thanks and gratitude for their continued outstanding
contribution to the Group.
Chief Executive Officer's review
The Government's restrictions, as a result of Covid-19, during
the Period, limited our access to properties with elements of work
being deferred as our clients and their residents undertook their
own protection measures to minimise the impact of the pandemic. As
a result, the Group delivered revenues of GBP23.4 million (2019:
GBP 29.8 million) with Adjusted EBITDA of GBP1.5 million (2019:
GBP2.1 million) and Adjusted earnings per share of 1.92 pence
(2019: 3.78 pence). However, the nature of our work is often
mandatory and underpinned by regulation, meaning the first lockdown
led to work being delayed and not cancelled, as was demonstrated by
the 54% increase in revenues from Q1 to Q2.
Over the last 18 months, we have prioritised our efforts on
stabilising the Group and focused on measures to drive our debt
levels down significantly. Our focus continues to be rewarded and
during the Period, Bilby has decreased net debt to GBP4.9 million
from GBP7.2 million, as reported at 31 March 2020 - a reduction of
33%. Over the past twelve months, net debt has been reduced by
GBP6.2 million, a decrease of 56% from the GBP11.1 million as
reported at 30 September 2019. It is pertinent to remember, as
recently as November 2019, Bilby was required to undertake an
equity fund raise of GBP2.0 million to improve the working capital
position of the Group; illustrating the significant progress the
Group has made in stabilising its finances.
Cash generation has become a strength of the Group and we will
continue to target reducing our debt levels through to the
financial year end.
Covid-19
The challenges we faced over the Period created by the Covid-19
pandemic were significant. However, the historic measures we took
in the prior year to restructure the Group were critical to
ensuring Bilby entered the Covid-19 pandemic in a strong position.
A crucial factor in our performance during the Period was our
preparedness for the significant business interruption, which we
had started before the UK Government imposed the lockdown. To save
the maximum amount of jobs, the Company took advantage of various
government initiatives available, including the Job Retention
Scheme as well as VAT and NI/PAYE deferments.
The UK Government recognise Bilby's services as essential work.
Throughout the pandemic, our employees, therefore, continued to
deliver services, at all times operating in a safe and compliant
manner with extensive protective measures in place to ensure the
safety and wellbeing of all our employees and customers alike. Our
consistent and continuous presence throughout enabled us to capture
additional work streams from clients where their resources were
limited as a result of the Government's restrictions. This served
to partially offset elements of the delayed works.
Bilby is committed to the communities in which it operates and
the passion of our workforce was clear to see with many undertaking
voluntarily community support work alongside their existing
customer responsibilities.
Ongoing restructuring, realignment and investment
The stability of the Group alongside our renewed vigour has
enabled us to accelerate improving and aligning our structure to
provide the necessary foundations to enable both organic as well as
acquisitional growth. A substantial amount of work has been
undertaken in the Period to ensure greater transparency,
coordination and efficiency between our call centre and engineers,
resulting in a marked improvement in productivity. This has
provided an opportunity to restructure our cost base, which
although has resulted in certain one-off costs, will result in
annualised savings of over GBP1 million. These savings are being
reinvested under three main pillars; governance, operational
excellence and growth.
Under "governance", besides strengthening our IT systems, we
have also continued to invest in systems and people within our
finance function, including the appointment of a Group Financial
Controller and Group Managing Surveyor together with investment in
the divisional finance teams and establishing a shared service
function.
Under "operational excellence", we have segregated the
responsibilities of the call administration team into a pooled call
analyst team and specific contract administrators. In addition, we
have also segregated the operational and financial supervisory
duties within the contract management team, maximising the quality
of the service our engineers deliver, whilst also tightening our
working capital processes and customer billing efficiency.
Additional efficiencies were created by closing our Sidcup office
and consolidating Purdy Build into DCB Kent offices and the Purdy
South Electrical team into the main Purdy office.
The final pillar for reinvestment of savings from our
restructure is "growth". During the Period, we enhanced our
commitment to strengthen the organic growth potential of two key
core platforms for the Group: Green energy and Compliance. We have
invested in diversifying the skill base of our engineers, we have
invested in gaining further Green accreditations including the
relevant certification for electric vehicle charging and
microgeneration schemes and we are now investing in resources to
bring specific compliance and regulatory driven work streams in
house. Underpinning these initiatives, we have recruited additional
members to join the Group's business development team in order to
ensure we have sufficient resources to pave our future organic
growth path.
As previously stated, the Group intends to evolve its strategy
to ensure it is fit for purpose and remains in line with our
clients expectations for the future. Accordingly, with the footing
of the Company more assured, we intend to balance our internal
focus with greater engagement of all our key stakeholders to ensure
their core values are reflected appropriately as we seek to define
and conclude our strategic outlook and offer. This process has been
slightly delayed due to Covid-19 restrictions. However, we
anticipate making progress during the second half of the financial
year and will keep the market updated as appropriate.
Market developments/trends
Aligned with the Group's investment and restructure with the
"growth pillar", the UK Government has announced the need to
increase the supply of affordable housing as well as its 10 point
plan for net-zero carbon emissions which is positive for the
services industry Bilby's operates in. The industry has a key role
in supporting the Government on reaching its goals through a range
of services including fit-out, maintenance and compliance
testing.
The Government's 10 point plan to reach zero carbon emissions by
2050 included the need for greener buildings. The Government has
pledged over GBP1 billion in funding for these new era buildings.
There is a requirement to build over 380,000 affordable homes every
year for the next 15 years which will be built in compliance with
all new regulations and targets which include no new homes to be
connected to the gas grid from 2023 and will be 'zero carbon ready'
and have 75-80% lower carbon dioxide emissions. In addition, the
Government is aiming for 600,000 heat pump installations per year
by 2028, and GBP1.3 billion has been made available to accelerate
the rollout of electric vehicle charge points across councils in
the UK.
We believe we will be well positioned to capture the
opportunities from these proposed Government initiatives.
Talent
Following my arrival into Bilby, a number of Employee Engagement
initiatives were put in place to provide our staff members with a
voice that enabled them to share their thoughts, as valued
employees, of the Group. We have listened, we have learned and we
have acted. Following the appointment of a new HR Director in
March, we have made significant changes to the way we manage our
staff, retain and attract new talent. The most comprehensive
package of benefits in the Company's history has been implemented
for our staff; from subsidies for electric bikes, standardising
holidays, revised hours of work, transparent and structured pay
banding, internal promotions during our restructuring program, a
Share Incentive Plan, a Company Share Option Plan as well as
professional and personal development initiatives to ensure all at
Bilby have the opportunity to maximise their potential and build
their Bilby careers as the Company nurtures its future leaders. The
Company's ambition to be best in class begins with our people and
the working environment we create for them - I am pleased the
Company is now in a position to demonstrate this belief and return
some value to our employees.
Outlook
As we continue to operate in regions with various levels of
lockdown restrictions, we remain confident the mandatory nature of
our work, driven by regulation, will be delayed rather than
cancelled. However, the visibility on implications and timings
remains challenging. Regardless, the Group has demonstrated a
renewed strength and vigour throughout the pandemic and will
continue to capture all work streams that remain open, continue to
prioritise the reduction of debt and continue to lay the solid
foundations that are transitioning the Group from a historical
position of survival to current day revival. These efforts are
already yielding positive results and we look forward with
confidence to a trajectory of long term sustainable growth.
Financial review
Trading review
Considering the significant Covid-19 challenges we faced in the
Period, the Board are pleased with the performance of the Group in
the 6 months to 30 September 2020.
Revenues of GBP23.4 million (2019: GBP29.8 million) and Adjusted
EBITDA of GBP1.5 million (2019: GBP2.1 million) for the six month
period ended 30 September 2020, represents a run rate of 79% and
74% respectively compared to the prior period.
The reduction in underlying revenues, resulting from the lack of
access to property, was partly mitigated by capturing additional
work streams to support our clients. Despite the lower, Covid-19
impacted, run rate in the Period, the nature of Bilby's services
generally means the majority of the work is delayed rather than
cancelled, as reflected by the 54% increase in revenues in the
three months to 30 September 2020 (Q2) compared to the first
quarter of the Period.
Loss before taxation was GBP192,000 (2019: profit GBP711,000),
impacted by the lower run rate in the Period and non-underlying
exceptional restructuring costs of GBP371,000, as set out
below.
The Adjusted EBITDA of GBP1.5 million in the Period is
considered by the Board to be a key Alternative Performance Measure
("APM") as it is the basis upon which the underlying management
information is prepared and the performance of the business
assessed by the Board. It is also the measure for the covenants
under our banking arrangements.
Adjusted EBITDA is calculated as earnings before interest,
taxation, depreciation and amortisation, excluding non-underlying
items and before the effect of the implementation of IFRS 16
"Leases". A reconciliation of EBITDA (including the effect of IFRS
16) and Adjusted EBITDA (stated pre-IFRS 16) is set out below:
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 September 30 September 31 March
2020 2019 2020
GBP'000 GBP'000 GBP'000
(Loss)/profit before tax (192) 711 1,727
Add back: non-underlying items 1,352 991 1,964
Underlying profit before tax 1,160 1,702 3,691
Adjustments for items not included
in EBITDA:
Finance costs 248 215 565
Depreciation of property, plant and
equipment 94 123 258
Depreciation of right-of-use assets 411 388 801
Amortisation of software costs 13 10 31
(Profit)/loss on disposal of property,
plant and equipment (2) 12 162
EBITDA (including the effect of adopting
IFRS 16) 1,924 2,450 5,508
Eliminate effect of adopting IFRS 16 (401) (388) (840)
------------- ------------- ---------
Adjusted EBITDA (excluding the effect
of adopting IFRS) 1,523 2,062 4,668
------------- ------------- ---------
Non-underlying items
Non-underlying items are considered by the Board to be either
exceptional in size, one-off in nature or non-trading related items
and are represented by the following, and as set out in note 3.
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 September 30 September 31 March
2020 2019 2020
GBP'000 GBP'000 GBP'000
Amortisation of customer relationships 963 963 1,925
Share based payment charge 18 28 39
Restructuring costs 371 - -
------------- ------------- ---------
Total 1,352 991 1,964
------------- ------------- ---------
The Group incurred restructuring costs of GBP371,000 in the
Period. The Group is reinvesting the majority of the restructuring
savings, which are expected be in excess of GBP1.0 million per
annum, to greater support future revenue growth, operational
efficiency and governance infrastructure. This includes
diversification into new work streams, new business and commercial
resource and investment in finance teams, systems and
technology.
Cash flow performance
Adjusted net cash generated from operating activities in the
Period was GBP1.9 million (2019: GBP2.4 million) delivering an
Adjusted operating cash conversion of 124% (2019: 117%).
Adjusted operating cash conversion is calculated as cash
generated from operations, pre IFRS 16, of GBP2.6 million (2019:
GBP629,000), after adding back exceptional cash payments of
GBP371,000 (2019: GBP1.8 million) and adjusted for the effects of
deferred HMRC payments of GBP1.1 million (2019: GBPnil), in the
Period; divided by Adjusted EBITDA of GBP1.5 million (2019: GBP2.1
million), as set out below;
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 September 30 September 31 March
2020 2019 2020
GBP'000 GBP'000 GBP'000
Net cash generated from operating
activities per condensed consolidated
statement of cash flows 3,004 1,017 3,886
Reinstate operating lease payments
eliminated on adoption of IFRS 16 (401) (388) (840)
2,603 629 3,046
Add back exceptional payments 371 1,780 1,935
Less deferred HMRC payments (1,092) - (377)
------------- ------------- ---------
Adjusted net cash generated from
operating activities 1,882 2,409 4,604
------------- ------------- ---------
Adjusted EBITDA (as above) 1,523 2,062 4,668
------------- ------------- ---------
Adjusted operating cash conversion 124% 117% 99%
------------- ------------- ---------
All deferred PAYE/NI liabilities have now been settled. The
March 2020 PAYE/NI liability was deferred at 31 March 2020 and paid
during the Period. The April PAYE/NI liability was deferred during
the Period and paid in the first week of October 2020.
HMRC VAT liabilities of GBP1.0 million, in the Period, were
deferred and are due for payment from March 2021 onwards, in line
with HMRC guidance.
Net debt
There has been a continuing focus on cash management and
reduction in net debt. In the six month period to 30 September
2020, net debt reduced by GBP2.3 million (33%) to GBP4.9 million
compared to net debt of GBP7.2 million at 31 March 2020.
Net debt has reduced GBP6.2 million (56%) from GBP11.1 million
to GBP4.9 million since 30 September 2019, partly facilitated by an
equity fund raise in November 2019 of GBP1.8 million, net of
costs.
Set out below is an analysis of net debt:
Unaudited Unaudited Audited
at 30 September at 30 at 31
2020 September March
2019 2020
GBP'000 GBP'000 GBP'000
Net (cash)/overdraft (2,465) 6,292 3,332
HSBC term loan 6,833 4,167 3,333
HSBC Mortgage 285 342 314
Other term loan 207 267 235
---------------- ---------- -------
Net debt 4,860 11,068 7,214
---------------- ---------- -------
In May 2020 the Group concluded the restructure of its
facilities with HSBC. Overall net debt was rebalanced and remained
unchanged with the new facilities comprising a Term loan of GBP7.33
million and overdraft facility of GBP2.5 million; replacing a Term
loan of GBP3.33 million and overdraft facility of GBP6.5
million.
At 30 September 2020 the Group had repaid the first quarterly
tranche of GBP500,000 of the HSBC term loan. Net cash amounted to
GBP2.5 million giving headroom of GBP5.0 million against the
available overdraft facility.
As part of the restructure of the bank facilities with HSBC, the
Group agreed new financial covenants comprising Adjusted EBITDA,
interest cover and debt service cover; the only covenant for the
year ending 31 March 2021 is a minimum annual Adjusted EBITDA
target of GBP1.1 million, which has been exceeded in the six month
period ended 30 September 2020.
The minimum Adjusted EBITDA target for year ending 31 March 2022
is GBP2.9 million measured quarterly on a cumulative basis.
Interest cover (minimum target 4.0 times) and debt service cover
(minimum target 1.0 times) are also measured quarterly, on a
cumulative basis, effective from June 2021 and September 2021
respectively.
Dividends
No dividend was paid in the Period (2019: GBPnil). No dividend
is currently recommended for the year ending 31 March 2021 as the
Group continues to prioritise the reduction of net debt,
particularly with the continuing uncertainty of the impact of the
Covid-19 pandemic.
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six month period ended 30 September 2020
Unaudited Unaudited Audited
6 months 6 months Year ended
to to 31 March
30 September 30 September 2020
2020 2019
GBP'000 GBP'000 GBP'000
Revenue 23,432 29,778 65,392
Cost of sales (17,438) (21,959) (48,795)
Gross Profit 5,994 7,819 16,597
Underlying administrative expenses (4,586) (5,902) (12,341)
------------- ------------- -----------
Operating profit before non-underlying
items 1,408 1,917 4,256
Non-underlying administrative expenses
Amortisation of customer relationships (963) (963) (1,925)
Share based payment charge (18) (28) (39)
Restructuring costs (371) - -
Total non-underlying administrative
expenses (note 3) (1,352) (991) (1,964)
Operating profit 56 926 2,292
Finance costs (248) (215) (565)
(Loss)/profit before taxation (192) 711 1,727
Income tax expense 37 (169) (348)
Total (loss)/profit for the period
attributable to the equity holders
of the parent company (155) 542 1,379
Other comprehensive income - - -
Total comprehensive (loss)/income for
the period attributable to the equity
holders of the parent company (155) 542 1,379
============= ============= ===========
(Loss)/earnings per share (note 5)
Basic (pence) (0.26) 1.34 2.93
Diluted (pence) (0.26) 1.34 2.93
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
At 30 September 2020
Unaudited Restated* Audited
30 September unaudited 31 March
2020 30 September 2020
2019
GBP'000 GBP'000 GBP'000
Assets
Non-current assets
Intangible fixed assets 8,984 10,930 9,937
Property plant and equipment 1,326 1,621 1,418
Right-of-use-assets 1,684 2,245 2,079
------------- ------------- ---------
Total non-current assets 11,994 14,796 13,434
------------- ------------- ---------
Current assets
Inventories 4,386 3,425 3,781
Trade and other receivables 15,481 17,555 19,451
Cash and cash equivalents 2,465 11 19
------------- ------------- ---------
Total current assets 22,332 20,991 23,251
------------- ------------- ---------
Total assets 34,326 35,787 36,685
============= ============= =========
Issued share capital and reserves
Share capital (note 7) 5,872 4,054 5,872
Share premium 8,609 8,609 8,609
Share based payment reserve 630 855 612
Merger reserve (248) (248) (248)
Retained earnings (4,376) (5,329) (4,221)
Total equity attributable to the equity
of the group 10,487 7,941 10,624
------------- ------------- ---------
Non-current liabilities
Borrowings (note 6) 5,206 212 176
Lease liabilities 1,133 1,481 1,486
Deferred tax liabilities 759 599 779
7,098 2,292 2,441
------------- ------------- ---------
Current liabilities
Overdraft (note 6) - 6,303 3,351
Borrowings (note 6) 2,119 4,564 3,706
Lease liabilities 610 781 620
Current income tax liabilities - - -
Trade and other payables 14,012 13,906 15,943
16,741 25,554 23,620
------------- ------------- ---------
Total equity and liabilities 34,326 35,787 36,685
============= ============= =========
* See note 10 for details of the prior
year restatement
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
For the six month period ended 30 September 2020
Unaudited Restated* Audited
6 months unaudited Year ended
to 6 months 31 March
30 September to 2020
2020 30 September
2019
GBP'000 GBP'000 GBP'000
Net cash generated from operating
activities (note 4) 3,004 1,017 3,886
------------- ------------- -----------
Cash flow from investing activities
Acquisition of subsidiaries - (476) (476)
Purchases of property, plant and equipment (22) (85) (282)
Purchase of intangible assets (13) (54) (44)
Proceeds on disposal of property,
plant and equipment 2 - 99
------------- ------------- -----------
Net cash used in investing activities (33) (615) (703)
------------- ------------- -----------
Cash flow from financing activities
Issue of new share capital (net of
share issue costs) - - 1,818
Proceeds from borrowings 7,333 - -
Repayment of borrowings (3,890) (883) (1,776)
Interest paid (248) (215) (565)
Principal payments of leases (369) (398) (794)
Dividends paid - - -
Net cash used in financing activities 2,826 (1,496) (1,317)
------------- ------------- -----------
Net increase/(decrease) in cash and
cash equivalents 5,797 (1,094) 1,866
Cash and cash equivalents at beginning
of period/year (3,332) (5,198) (5,198)
Cash and cash equivalents at end of
period/year 2,465 (6,292) (3,332)
============= ============= ===========
* See note 10 for details of the prior
year restatement
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the six month period ended 30 September 2020 (unaudited)
Issued Share Share based Merger Retained Total
share capital premium payment reserve earnings equity
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 April
2020 5,872 8,609 612 (248) (4,221) 10,624
Loss and total comprehensive
income for the period - - - - (155) (155)
Share-based payment
charge - - 18 - - 18
Balance at 30 September
2020 5,872 8,609 630 (248) (4,376) 10,487
============== ======== =========== ======== ========= =======
For the six month period ended 30 September 2019 (unaudited)
Balance at 1 April
2019 4,054 8,609 827 (248) (5,854) 7,388
Profit and total comprehensive
income for the period - - - - 542 542
Share-based payment
charge - - 28 - - 28
Balance at 30 September
2019 4,054 8,609 855 (248) (5,312) 7,958
For the year ended 31 March 2020
Balance at 1 April
2019 4,054 8,609 827 (248) (5,854) 7,388
Profit and total comprehensive
income for the period - - - - 1,379 1,379
Issue of share capital 1,818 - - - - 1,818
Share-based payment
charge - - 39 - - 39
Transfer to retained
earnings for share
options cancelled (254) 254 -
Balance at 31 March
2020 5,872 8,609 612 (248) (4,221) 10,624
============== ======== =========== ======== ========= =======
NOTES TO THE INTERIM STATEMENT
1. Basis of preparation
Bilby Plc and its subsidiaries (together "the Group") operate in
the gas heating, electrical and general building services
industries. The Group is a public company operating on the AIM
Market of the London Stock Exchange and is incorporated and
domiciled in England and Wales (registered number 09095860). The
address of its registered office is 201 Temple Chambers, 3-7 Temple
Avenue, London EC4Y 0DT.
These interim financial statements of the Group have been
prepared on a going concern basis under the historical cost
convention, and in accordance with International Financial
Reporting Standards ("IFRSs") as adopted by the European Union, the
International Financial Reporting Interpretations Committee
("IFRIC") interpretations issued by the International Accounting
Standards Boards ("IASB") that are effective or issued and early
adopted as at the time of preparing these financial statements and
in accordance with the provisions of the Companies Act 2006. The
Group has adopted all of the new and revised standards and
interpretations issued by the IASB and the International Financial
Reporting Interpretations Committee ("IFRIC") of the IASB, as they
have been adopted by the European Union, that are relevant to its
operations and effective for accounting periods beginning on 1
April 2020.
The interim financial information does not include all the
information and disclosures required in the annual financial
statements and should be read in conjunction with the Group's
annual financial statements, being the statutory financial
statements for Bilby Plc as at 31 March 2020, which have been
prepared in accordance with IFRS as adopted by the European
Union.
The interim financial information for the six months ended 30
September 2020 do not comprise statutory accounts within the
meaning of Section 434 of the Companies Act 2006. The interim
financial information has not been audited.
Significant accounting policies
The accounting policies adopted in the preparation of the
interim financial information is consistent with those expected to
be adopted in the preparation of the Group's annual financial
statements for the year ending 31 March 2021.
Going concern
The Directors have prepared detailed financial forecasts and
cash flows looking beyond twelve months from the date of these
consolidated financial statements. In developing these forecasts
the Directors have made assumptions based upon their view of the
current and future economic conditions that will prevail over the
forecast period, together with the expected impact of the ongoing
Covid-19 pandemic. The following factors have been considered by
the Board when assessing the future prospects of the Group:
-- Delivered GBP1.5m of EBITDA in the first half of the year
against a challenging backdrop of the Covid-19 epidemic.
-- Net increase in cash and cash equivalents of GBP5.8 million in the Period.
-- Reduced net debt by GBP2.3 million since the start of the financial year.
-- GBP2.5 million of available cash at 30 September 2020,
alongside a further GBP2.5m of available overdraft facility.
-- Whilst the Covid-19 pandemic has resulted in lower revenues
in the Period, the nature of Bilby's services generally means that
the majority of work is delayed rather than cancelled.
Based on the current forecasts, coupled with the above factors,
the board have a reasonable expectation that the Group has adequate
resources to continue to trade for the foreseeable future. For this
reason, the Board continues to adopt the going concern basis in the
preparation of these financial statements.
Publication of non-statutory financial statements
The results for the six months ended 30 September 2020 and 30
September 2019 are unaudited and have not been reviewed by the
auditor. Statutory accounts for the year ended 31 March 2020 were
filed with the Registrar of Companies in September 2020.
The interim financial information has been prepared on the basis
of the same accounting policies as published in the audited
financial statements for the year ended 31 March 2020.The annual
financial statements of the Group are prepared in accordance with
International Financial Reporting Standards and International
Financial Reporting Interpretations Committee ("IFRIC")
pronouncements as adopted by the European Union. Comparative
figures for the year ended 31 March 2020 have been extracted from
the statutory financial statements for that period.
2. Corporate governance, principal risks and uncertainties
The Corporate Governance Report included with our Annual Report
and Financial Statements for 2020 detailed how we embrace
governance. The Bilby Board recognise the importance of sound
corporate governance commensurate with the size and nature of the
Company and the interests of its shareholders.
The Quoted Companies Alliance has published a corporate
governance code for small and mid-sized quoted companies, which
includes a standard of minimum best practice for AIM companies, and
recommendations for reporting corporate governance matters (the
"QCA Code"). Bilby has adopted the QCA Code.
The nature of the principal risks and uncertainties faced by the
Group have not changed significantly from those set out within the
Bilby Plc annual report and accounts for the year ended 31 March
2020.
3. Non-underlying items
Operating profit includes the following items which are
considered by the Board to be exceptional in size, one off in
nature or non-trading related.
Note Unaudited Unaudited Audited
6 months 6 months Year ended
to to 31 March
30 September 30 September 2020
2020 2019
GBP'000 GBP'000 GBP'000
Amortisation of customer relationships (a) 963 963 1,925
Share based payment charge (b) 18 28 39
Restructuring costs (c) 371 - -
1,352 991 1,964
============= ============= ===========
All non-underlying items have been charged to other operating
expenses.
(a) Amortisation of customer relationships
Amortisation of acquisition intangibles was GBP0.963 million for
the period (H1 2019: GBP0.963 million) and relates to amortisation
of the customer relationships identified by the Directors on the
acquisition of Purdy, DCB, Spokemead and R. Dunham.
(b) Share based payment charge
A Group share option scheme is in place during the period. No
options were granted during the period (2019: none). The share
based payment charge has been separately identified as it is a
non-cash expense.
(c) Restructuring costs
Comprise redundancy and associated costs and costs of the
rationalisation of the property portfolio resulting from the
restructure of the Group operations and were one off and
non-recurring.
4. Cash flows from operating activities
Unaudited Restated* Audited
6 months unaudited Year ended
to 6 months 31 March
30 September to 2020
2020 30 September
2019
GBP'000 GBP'000 GBP'000
(Loss)/profit before income tax (192) 711 1,727
Adjusted for: - -
Finance costs 248 215 565
(Profit/(loss) on disposal of property,
plant and equipment (2) 12 162
Depreciation 505 510 1,059
Amortisation of intangible assets 976 973 1,956
Share based payments 18 28 39
Fair value adjustment - (100) (100)
Movement in receivables 3,826 993 (759)
Movement in payables (1,770) (2,033) (116)
Movement in inventories (605) (292) (647)
Tax paid - - -
Net cash from operating activities 3,004 1,017 3,886
============= ============= ===========
* See note 10 for details of the prior
year restatement
5. Earnings per share
The calculation of basic and diluted earnings per share is based
on the result attributable to shareholders divided by the weighted
average number of ordinary shares in issue during the year. Basic
earnings per share amounts are calculated by dividing net profit
for the year or period attributable to ordinary equity holders of
the parent by the weighted average number of ordinary shares
outstanding during the year.
Basic and diluted earnings per share is calculated as
follows:
Unaudited Unaudited Audited
6 months 6 months Year ended
to to 31 March
30 September 30 September 2020
2020 2019
GBP'000 GBP'000 GBP'000
Profit used in calculating basic and
diluted earnings
per share (155) 542 1,379
Weighted average number of shares
for the purpose of basic earnings
per share 58,721,845 40,540,027 47,105,684
Weighted average number of shares
for the purpose of diluted earnings
per share 58,721,845 40,540,027 47,105,684
Basic earnings per share (pence) (0.26) 1.34 2.93
Diluted earnings per share (pence) (0.26) 1.34 2.93
Adjusted earnings per share
Profit after tax is stated after deducting non-underlying items
totalling GBP1.352 million (2019: GBP0.991 million). Non-underlying
items are either exceptional in size, one off in nature or
non-trading related. These are shown separately on the face of the
Consolidated Statement of Comprehensive Income.
The calculation of adjusted basic and adjusted diluted earnings
per share is based on the result attributable to shareholders,
adjusted for non-underlying items, divided by the weighted average
number of ordinary shares in issue during the year.
Unaudited Unaudited Audited
6 months 6 months Year ended
to to 31 March
30 September 30 September 2020
2020 2019
GBP'000 GBP'000 GBP'000
Adjusted Earnings Per Share
Profit after tax (155) 542 1,379
Add back:
Amortisation of acquisition intangible
assets 963 963 1,925
Share based payment charge 18 28 39
Restructuring costs 371 - -
Impact of above adjustments on corporation
tax (70) - -
------------- ------------------ ----------------------------
1,127 1,533 3,343
------------- ------------------ ----------------------------
Weighted average number of shares
for the purpose of basic adjusted
earnings per share 58,721,845 40,540,027 47,105,684
Weighted average number of shares
for the purpose of diluted adjusted
earnings per share 58,721,845 40,540,027 47,105,684
Basic adjusted earnings per share
(pence) 1.92 3.78 7.10
Diluted adjusted earnings per share
(pence) 1.92 3.78 7.10
6. Borrowings
Unaudited Unaudited Audited
30 September 30 September 31 March
2020 2019 2020
GBP'000 GBP'000 GBP'000
Non-current borrowings
Bank and other borrowings;
Term loans 4,833 - -
Mortgage loan 228 - -
Other loans 145 212 176
------------- ------------- ---------
Total non-current borrowings 5,206 212 176
------------- ------------- ---------
Current borrowings;
Bank and other borrowings;
Term loans 2,000 4,167 3,333
Mortgage loans 57 342 314
Other loans 62 55 59
Overdraft - 6,303 3,351
------------- ------------- ---------
Total current borrowings 2,119 10,867 7,057
------------- ------------- ---------
Bank and other borrowings;
Term loans 6,833 4,167 3,333
Mortgage loans 285 342 314
Other loans 207 267 235
Overdraft - 6,303 3,351
------------- ------------- ---------
Total borrowings 7,325 11,079 7,233
------------- ------------- ---------
The fair value of the borrowings outstanding as at 30 September
2020 is not materially different to its carrying value since
interest rates applicable on the loans are close to market
rates.
On 22 May 2020 the Group secured new debt facilities totalling
GBP9.8m, consisting GBP7.3 million term loan facility (2019:
GBP3.3m) and GBP2.5 million overdraft facility (2019: GBP6.5m). The
facility expires in September 2022 with quarterly repayments of
GBP0.5 million, the first of which was made in August 2020.
The first covenant test for the new facility will be to achieve
a minimum EBITDA of GBP1.1 million for the year ending 31 March
2021. The covenants for the period beyond 31 March 2021 will be
tested quarterly and they are (i) achievement of minimum levels of
EBITDA; (ii) debt service cover; and (iii) interest cover.
7. Share capital
Ordinary shares of GBP0.10 each Unaudited
6 months
to
30 September
2020
GBP'000
At the beginning of the period 5,872
Issued in the period -
--------------
At the end of the period 5,872
Number of shares Unaudited
6 months
to
30 September
2020
At the beginning of the period 58,721,845
Issued in the period -
--------------
At the end of the period 58,721,845
8. Dividends
The Board do not recommend an interim dividend for the year
ending 31 March 2021.
9. Taxation
The income tax charge for the six months ended 30 September 2020
is calculated based upon the effective tax rates expected to apply
to the Group for the full year of 19% (2019: 19%). Differences
between the estimated effective rate and the statutory rate of 19%
are due to non-deductible expenses.
10. Prior year restatement
At the point the interim results for the six month period ended
30 September 2019 were published the Group was still in the process
of determining the basis of adopting IFRS 16 Leases for the first
time, and it was therefore not reflected in the results. The
project was subsequently completed and the full effect included in
the March 2020 annual financial statements. The comparatives for
the six months ended 30 September 2019 have been restated to
reflect the effect of IFRS 16 to present the results on a
comparable basis.
This resulted in an immaterial impact on the administrative
expenses due to the minor differences between the amortisation of
leases and previously reported rental charges. Interest costs were
also not significant in the period. However the balance sheet has
been restated to show the IFRS16 lease liability and the
capitalisation of the leases at a value of GBP2,245,000.
11. Forward-Looking statements
This report contains certain forward-looking statements with
respect to the financial condition of Bilby Plc. These statements
involve risk and uncertainty because they relate to events and
depend on circumstances that will occur in the future. There could
be a number of factors which influence the actual results and
developments. These could impact on the forward-looking statements
included in this report.
12. Interim Report
Copies of this Interim Report will be available to download from
the investor relations section on the Group's website
www.bilbyplc.com .
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