PHSC plc Trading Update
16 June 2016 - 4:00PM
UK Regulatory
TIDMPHSC
16 June 2016
PHSC PLC
Trading Update
PHSC plc ("the Group"), a leading provider of health, safety, hygiene and
environmental consultancy services and security solutions to the public and
private sectors, announces an update on its performance for the financial year
ended 31 March 2016.
These indicative figures are per management accounts and after certain
adjustments, and are currently in the final stages of audit. We expect to issue
our Final Results announcement in early August 2016.
Consolidated Group revenue for the period was around GBP 7.04m, representing a
fall of 9% year-on year (2015 - GBP 7.7m). The reduction arises principally
from the ending of a large asbestos management contract previously delivered by
Adamson's Laboratory Services Limited (ALS) with a leading university, as
mentioned in our interim results statement. ALS was unable to find sufficient
replacement work to bridge the gap during the second half.
It is encouraging that Consolidated Group revenue in the second half increased
around 12% over the first half but, as explained below, it is likely that due
principally to an impairment in the carrying value of goodwill the results for
the full year will not meet our expectation at the time of the interim results
statement that we would see a stronger second half to the year.
Underlying EBITDA (excluding the goodwill impairment charge below) stands at
GBP 0.418m (2015: GBP 0.818m) prior to various costs associated with the two
acquisitions made in December 2015. Legal and other costs totalled
approximately GBP 50,000. In addition, a further GBP 50,000 has been expended
in meeting the initial integration costs of one of those acquisitions, SG
Systems (UK) Limited, in the period to 31 March 2016. Should these costs not be
recovered over the earn-out period, they are deductible from the final
instalment due under the share purchase agreement.
Given the difficult trading conditions experienced by ALS, and in accordance
with standard tests applied by our Auditors, we anticipate an impairment of GBP
0.6m in the carrying value of goodwill in respect of ALS, representing a
reduction of approximately 9% in the consolidated net assets of the Group
before this adjustment.
The Company has adopted a progressive dividend policy. The directors believe
that the Company's distributable reserves are more than adequate to support the
payment of a dividend in line with previous years, should such a resolution be
supported at the AGM.
Management accounts indicate that both Group revenues and EBITDA in the early
part of 2016-17 are running ahead of the comparative figures for last year.
Cash flow remains positive and the average bank balance in June 2016 has been
circa GBP 0.25m. The Company also has a facility with its bankers, currently
not called upon, of GBP 0.2m.
For further information please contact:
PHSC plc 01622 717700
Stephen King
Stephen.king@phsc.co.uk
www.phsc.plc.uk
Northland Capital Partners Limited (Nominated Adviser) 0203 861 6625
Edward Hutton/David Hignell
Beaufort Securities Limited (Broker) 020 7382 8300
Elliot Hance
About PHSC
PHSC plc, through its trading subsidiaries Personnel Health & Safety
Consultants Ltd, RSA Environmental Health Ltd, Adamson's Laboratory Services
Ltd, QCS International Ltd, Inspection Services (UK) Ltd and Quality Leisure
Management Ltd, provides a range of health, safety, hygiene, environmental and
quality systems consultancy and training services to organisations across the
UK. B to B Links Ltd and SG Systems (UK) Ltd offer innovative retail security
solutions including tagging, labelling and CCTV.
END
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