TIDMROL
RNS Number : 2609X
Rotala PLC
09 August 2018
9 August 2018
Rotala Plc
("Rotala" or "the Company" or "the Group")
Unaudited Interim Results
Rotala plc (AIM:ROL), a provider of transport solutions across
the UK, announces its unaudited interim results for the six months
to 31 May 2018.
Highlights
-- Revenue up 14% vs. H1 2017 to GBP32.7 million
-- Profit from operations up 18% to GBP2.3 million*
-- Profit before taxation up 17% to GBP1.57 million*
-- Basic adjusted earnings per share up 3.5% to 2.67p*
-- Interim dividend increased by 8% to 0.92p per share (2017: 0.85p)
-- Rotala continues to pursue attractive acquisition targets
-- Current trading in line with market expectations
*before exceptional items
For further information please contact:
Rotala Plc 0121 322 2222
John Gunn, Chairman
Simon Dunn, Chief Executive
Kim Taylor, Group Finance Director
Nominated Adviser & Joint Broker:
Cenkos Securities plc 020 7397 8900
Stephen Keys/Callum Davidson (Corporate
Finance)
Michael Johnson/Julian Morse (Corporate
Broking)
Joint Broker: Dowgate Capital Stockbrokers
Ltd 0203 903 7715
David Poutney/James Serjeant (Corporate
Broking)
Chairman's Statement
I am pleased to present this interim report to shareholders in
respect of the six months ended 31 May 2018. The Company has
continued to make good progress in the first half of 2018, building
on the benefits derived from the three acquisitions made in 2017
and the Central Buses acquisition made in the current accounting
period.
Results
Revenues for the Group as a whole during the period were GBP32.7
million. This represents an increase of 14% compared to the same
period in the previous year. Operating margins fell slightly to
17.9% (2017: 18.9%) but this is attributable to seasonality effects
to which I will return below. Pre- tax profits before exceptional
items rose by 17% to GBP1.57 million (2017: GBP1.34 million).
Contracted Services
Revenues in the Contracted Services division rose overall by
13.5%, when compared to the first half of 2017, to GBP11.8 million
(2017: GBP10.4 million). Revenues in this division have increased
by almost 50% over the last four years. This level of growth
reflects the investment we have made in this division over this
period, not only in the form of acquisition but also in a
determination to become a key player in the contracted markets in
which we are now represented.
Thus we entered the Manchester market through an acquisition in
2015 and in the intervening period we have successfully expanded
the contracted base of the business by winning an increasing number
of contracts from Transport for Greater Manchester. This progress
was bolstered in 2017 by the acquisition of the Goodwins business.
Similarly in the West Midlands, the Hansons acquisition in 2017,
followed by that of Central Buses in 2018, has significantly
improved our market share in the Transport for the West Midlands
contracted market. We have also benefited from smaller, but locally
important, gains in local authority contracts in Lancashire and
Surrey, compared to the corresponding period in 2017.
In contrast to earlier years, therefore, income from local
authority bus contracts has become the larger component of the
Contracted Services division and now forms about 19% of group
revenues. Revenues from corporate contracts, leaving aside a
dwindling share of this market in the South West, were steady
period on period.
Commercial Services
Revenues in the Commercial Services division, compared to the
first half of 2017, rose by 19% to GBP20.1 million (2017: GBP16.9
million). Revenue gains were enjoyed in all geographical areas
except for the South West where we have been deliberately reducing
the number of our commercial services. In the West Midlands the
acquisition of Hansons in 2017 and Central Buses in 2018 has
undoubtedly improved our market share considerably. The Goodwins
acquisition in Manchester, allied to the registration of some new
routes, has also made a very positive contribution to revenue in
this area of the business. The bulk of the increase in revenues in
this division has been provided by the Hotel Hoppa acquisition
which was made late in 2017. This business is however seasonal,
since it is reliant on the tourist traffic coming into and out of
Heathrow airport, which significantly increases in the Summer
months. This explains the dip in margins of the first half of this
year to which I referred at the beginning of my statement. The
busiest months of the Hotel Hoppa business lie in the second half
of our accounting year and will have a beneficial impact on margins
in that accounting period. In the remaining part of this division
revenues in Preston were consistent with the previous year.
Overall therefore this division has increased in size by about
20% since 2015, reflecting in particular the acquisitions made for
this division of the Group in 2017.
Charter Services
Revenues in the Charter Services division fell by 41% compared
to the previous year to GBP748,000 (2017: GBP1.28 million). This
fall can be ascribed to two factors: first the amount of rail
replacement work which we were able to obtain was much down on the
previous year. Secondly the generally poor winter weather, being
both unusually cold and wet for extended periods, had a markedly
detrimental effect on activity in the private hire coach market in
the first half of the year. It is noticeable that in the recent
good weather the private hire market has shown renewed vigour.
Dividend
The Company will pay an interim dividend of 0.92 pence per share
(2017: 0.85 pence) on 7 December 2018 to all shareholders on the
register on 16 November 2018. The board is conscious of the
importance of dividend flows to shareholders; the board has set a
target for dividend cover of 2.5 times earnings in the longer
term.
Acquisition and Investment
At the end of February 2018 the Group acquired from CEN Group
Limited, trading as Central Buses ("Central"), its entire bus
business, bus brand and 30-strong vehicle fleet for a cash
consideration of GBP1,950,000. The Central business had annual
revenues of approximately GBP2.8 million and its vehicle fleet had
a fair value at acquisition of approximately GBP1.5 million. No
other assets or liabilities of any materiality were assumed on
acquisition. The acquisition is expected to be earnings enhancing
from acquisition.
Central Buses was a well-established operator of commercial and
contracted bus services in the northern part of the West Midlands
area. This business, with its staff, was immediately integrated
into the existing depot infrastructure which Rotala already
possesses in the West Midlands and so no additional overhead was
required as part of the acquisition. The acquisition extends the
Group's network of bus services in the northern part of Birmingham,
particularly in the Perry Barr area.
In order to integrate the acquisition with the rest of the Group
we re-equipped the business with the standard Ticketer ticket
machines which we use in the West Midlands region. In the first
half of 2018 we also moved the whole Manchester business onto these
machines and began to process of converting the Preston business as
well. This investment in new ticket machines forms the bulk of the
addition to plant and machinery of GBP530,000 in the period.
Also in the first half of the year in Manchester we purchased
for GBP220,000 the freehold site next door to the one which we
acquired with the Goodwins acquisition in 2017. We have cleared
this new site of its unwanted buildings and thereby doubled the
size of the freehold depot we possess in the Eccles area of
Manchester. The depot is now comparable in size to our Atherton
depot and gives us ample room for expansion in accordance with our
plans for the area.
Debt
At the beginning of this accounting period the Group changed its
principal bankers to HSBC Bank Plc. Besides the attraction of
enlarged facilities to support the Group's greater scale of
operation, another key aspect of the HSBC offering is that it is
tailored to the business characteristics of a bus company. In order
to operate we must invest heavily in property and vehicles. HSBC
regard all secured lending, in the form of property mortgages and
hire-purchase finance attached to vehicles, as forming no part of
the leverage covenant that they wish to monitor. Their focus
therefore is only on unsecured lending, which at 31 May 2018 stood
at GBP11.4 million. At the same point, against a net book value in
the vehicle fleet of GBP27.4 million, borrowings on hire purchase
finance totalled GBP13.5 million and mortgage borrowing was GBP5.5
million compared to the net book value of freehold property of
GBP7.5 million at that date.
Financial review
The following comments on the Condensed Income Statement address
the results before any exceptional items. Revenues increased by 14%
when compared with the same period in 2017, as explained above.
Cost of Sales rose by 16%; consequently Gross Profits increased by
8% to GBP5.85 million (2017: GBP5.4 million). Administrative
Expenses however increased by only 3%. Profit from Operations was
therefore up by 18% and reached GBP2.32 million for the period
(2017: GBP1.96 million). Net finance expense rose to reflect the
increased size of the business, the larger vehicle fleet and the
bank finance drawn down for acquisitions. Profit before Taxation
increased by 17% to GBP1.57 million (2017: GBP1.34 million). Note 3
to this statement analyses the exceptional item column in the
income statement.
The new shares issued in 2017 have increased the weighted
average number of shares in issue, but the second half seasonality
of the largest acquisition made with the funds raised (the Hotel
Hoppa business) means that adjusted basic earnings per share, based
on profits after tax and before exceptional items, were only some
3.5% up at 2.67 pence per share (2017: 2.58 pence). Basic earnings
per share, including all exceptional items, were 2.62 pence per
share in the period (2017: 1.79 pence), reflecting principally the
large swing in the mark to market provision for the fuel
derivative.
The gross assets of the Group were GBP75.1 million at 31 May
2018, compared to GBP65.3 million at the same time in the previous
year. This change reflects the acquisitions made over the past
twelve months, and investment in ticket machines and the vehicle
fleet. An analysis of the Group's holdings of property, plant and
equipment is set out in Note 5 to this statement. The working
capital assets of the group have also increased for the same
reasons.
These factors have had their effect on total liabilities, which
have risen to GBP41.2 million at 31 May 2018 (2017: GBP37.0
million). The net loans and borrowings of the Group, including its
obligations under hire purchase contracts, stood at GBP32.7 million
at 31 May 2018 (31 May 2017: GBP25.7 million), as a result both of
the acquisitions made and the investment in ticket machines and
vehicles. An analysis of these borrowings is set out in Notes 6 and
7 to this statement. Net assets were GBP33.2 million at the period
end (31 May 2017: GBP28.2 million). The large positive movement in
the mark to market provision on the fuel derivative, combined with
the 2017 share issue and retained profits, account for this
change.
Cash flows from operating activities were 40% up on the same
period in the previous year but these flows were entirely absorbed
by the demands made on working capital by the increased size of the
Group. Hire purchase interest increased to reflect the larger
borrowings via this type of financing arrangement. Plant and
equipment purchases were, as in 2017, largely offset by vehicles
sold.
Cash flows from financing activities in the period principally
reflect the large flows associated with the change in the Group's
bankers at the start of the accounting year in December 2017,
combined with some hire purchase refinancing activity. The capital
element of payments on HP agreements fell slightly period on
period. There was the usual decrease in cash and cash equivalents
in the first half of the year, though a little lower at GBP0.7m
than the GBP0.8 million of the previous year. The profitability,
and resultant cash flows, of the Group are customarily weighted
towards the second half of the year and this pattern can be
expected to be repeated in the second half of 2018.
Outlook
The progress achieved by the Group during the first half of the
year has been very encouraging. Bearing in mind that the Group's
profitability has an increased bias to the second half of the year
as a consequence of the Hotel Hoppa acquisition, the results we
have achieved in the first half of the year make the Board
confident that we remain well on course to meet market expectations
for the financial year as a whole.
Rotala has a proven track record of steady organic growth
supplemented by sensibly priced acquisitions. The recent
acquisition of Central Buses conforms to this strategy. We continue
to be actively engaged in hunting out potential acquisitions and,
with the backing of our new bankers, possess considerable firepower
which can be used to attain these targets.
In our assessment there will continue to be much divestment and
acquisition activity in the bus market in the next few years. We
undoubtedly have the management skills and the resources to
capitalise on these opportunities. This makes us confident about
the prospects of the Group in 2018 and beyond.
John Gunn
Non-Executive Chairman
9 August 2018
Condensed Note Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
consolidated 6 months 6 months 6 months 6 months 6 months 6 months
income statement ended 31 ended 31 ended 31 ended 31 ended ended 31
May 2018 May 2018 May 2018 May 2017 31 May May 2017
2017
Results Exceptional Results Results Exceptional Results
before items for the before items for the
exceptional period exceptional period
items items
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue 2 32,713 - 32,713 28,627 - 28,627
Cost of sales (26,864) - (26,864) (23,227) - (23,227)
Gross profit 5,849 - 5,849 5,400 - 5,400
Administrative
expenses (3,534) 36 (3,498) (3,439) (408) (3,847)
Profit from
operations 2,315 36 2,351 1,961 (408) 1,553
Finance expense (748) - (748) (621) - (621)
Profit before
taxation 3 1,567 36 1,603 1,340 (408) 932
Tax expense (283) (61) (344) (253) 78 (175)
Profit for
the period
attributable
to the equity
holders of
the parent 1,284 (25) 1,259 1,087 (330) 757
Earnings per
share for
profit attributable
to the equity
holders of
the parent
during the
period:
Basic (pence) 4 2.67 2.62 2.58 1.79
Diluted (pence) 4 2.67 2.62 2.57 1.79
Condensed consolidated Note Audited year Audited year Audited
income statement ended 30 ended 30 year ended
November November 30 November
2017 2017 2017
Results Exceptional Results
before items for the
exceptional year
items
GBP'000 GBP'000 GBP'000
Revenue 2 57,906 - 57,906
Cost of sales (46,828) - (46,828)
Gross profit 11,078 - 11,078
Administrative
expenses (6,599) (796) (7,395)
Profit from operations 4,479 (796) 3,683
Finance expense (1,264) - (1,264)
Profit before
taxation 3 3,215 (796) 2,419
Tax expense (595) 257 (338)
Profit for the
year attributable
to the equity
holders of the
parent 2,620 (539) 2,081
Earnings per
share for profit
attributable
to the equity
holders of the
parent during
the year:
Basic (pence) 4 5.95 4.73
Diluted (pence) 4 5.94 4.72
Condensed consolidated Unaudited 6 Unaudited Audited year
statement of comprehensive months ended 6 months ended 30
income 31 May 2018 ended 31 November
May 2017 2017
GBP'000 GBP'000 GBP'000
Profit for the period 1,259 757 2,081
-------------- ---------- -------------
Other comprehensive income:
Actuarial profit on defined
benefit pension scheme - - 58
Deferred tax on actuarial
profit on defined benefit
pension scheme - - (11)
--------------
Other comprehensive income
for the period (net of
tax) - - 47
Total comprehensive income
for the period attributable
to the equity holders of
the parent 1,259 757 2,128
============== ========== =============
Condensed consolidated Called Share Merger Shares Retained Total
Statement of Changes up share premium reserve in treasury earnings
in Equity capital account
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 December 2016 10,762 9,875 2,567 (817) 5,424 27,811
---------- --------- --------- ------------- ---------- ------------
Profit for the period - - - - 757 757
Other comprehensive - - - - - -
income
Total comprehensive
income - - - - 757 757
Transactions with
owners:
Share based payment - - - - 10 10
Dividends paid - - - - (338) (338)
Transactions with
owners - - - - (328) (328)
At 31 May 2017 10,762 9,875 2,567 (817) 5,853 28,240
---------- --------- --------- ------------- ---------- ------------
Profit for the period - - - - 1,324 1,324
Other comprehensive
income - - - - 47 47
Total comprehensive
income - - - - 1,371 1,371
Transactions with
owners:
Shares issued 1,458 1,904 - - - 3,362
Share based payment - - - - 10 10
Dividends paid - - - - (632) (632)
Transactions with
owners 1,458 1,904 - - (622) 2,740
At 30 November 2017 12,220 11,779 2,567 (817) 6,602 32,351
---------- --------- --------- ------------- ---------- ------------
Profit for the period - - - - 1,259 1,259
Other comprehensive - - - - - -
income
Total comprehensive
income - - - - 1,259 1,259
Transactions with
owners:
Share based payment - - - - 2 2
Dividends paid - - - - (408) (408)
Transactions with
owners - - - - (406) (406)
At 31 May 2018 12,220 11,779 2,567 (817) 7,455 33,204
Condensed consolidated Notes Unaudited Unaudited Audited as at
statement of financial as at 31 as at 31 30 November 2017
position May 2018 May 2017
GBP'000 GBP'000 GBP'000
Assets
Non-current assets
Property, plant and
equipment 5 39,353 35,491 36,925
Goodwill and other intangible
assets 15,110 12,033 14,759
_____ _____ _____
Total non-current assets 54,463 47,524 51,684
Current assets
Inventories 2,743 3,086 2,526
Trade and other receivables 16,628 13,635 13,646
Derivative financial
instruments 752 63 450
Cash and cash equivalents 514 947 627
_____ _____ _____
Total current assets 20,637 17,731 17,249
_____ _____ _____
Total assets 75,100 65,255 68,933
Liabilities
Current liabilities
Trade and other payables (6,723) (7,407) (6,477)
Loans and borrowings 6 (14,571) (15,272) (16,278)
Obligations under hire
purchase agreements 7 (3,682) (2,871) (3,158)
Derivative financial - (211) -
instruments
______ ______ _____
Total current liabilities (24,976) (25,761) (25,913)
Non-current liabilities
Loans and borrowings 6 (5,204) - -
Obligations under hire
purchase agreements 7 (9,840) (8,503) (8,357)
Provision for liabilities (586) (1,477) (1,203)
Defined benefit pension
obligation (265) (644) (427)
Deferred taxation (1,025) (630) (682)
______ ______ ______
Total non-current liabilities (16,920) (11,254) (10,669)
______ ______ ______
Total liabilities (41,896) (37,015) (36,582)
_____ _____ _____
Net assets 33,204 28,240 32,351
====== ====== =====
Condensed consolidated Unaudited Unaudited Audited as at
statement of financial as at 31 as at 31 30 November 2017
position May 2018 May 2017
GBP'000 GBP'000 GBP'000
Equity attributable
to equity holders
of parent
Called up share capital 12,220 10,762 12,220
Share premium reserve 11,779 9,875 11,779
Merger reserve 2,567 2,567 2,567
Shares in treasury (817) (817) (817)
Retained earnings 7,455 5,853 6,602
______ ______ _____
Total equity 33,204 28,240 32,351
===== ===== ====
Condensed consolidated Unaudited Unaudited Audited year
cash flow statement 6 months ended 6 months ended ended 30 November
31 May 2018 31 May 2017 2017
GBP'000 GBP'000 GBP'000
Cash flows from operating
activities
Profit for the period
before tax 1,603 932 2,419
Finance expense (net) 748 621 1,264
Depreciation 1,725 1,597 3,274
Gain on sale of property,
plant and equipment (241) (242) (446)
Acquisition expenses 49 - 47
Contribution to defined
benefit pension scheme (162) (156) (337)
Amortisation of intangibles 153 - 19
Notional expense of defined
benefit pension scheme - - 22
Equity-settled share
based payment expense 2 10 20
____ ____ ____
Cash flows from operating
activities before changes
in working capital and
provisions 3,877 2,762 6,282
Increase in trade and
other receivables (2,980) (2,497) (2,056)
Increase in trade and
other payables 281 2,302 396
(Increase)/decrease in
inventories (217) (231) 80
Movement on provisions (617) (176) (450)
Movement on derivative
financial instruments (302) 191 (408)
____ ____ ____
(3,835) (411) (2,438)
____ ____ ____
Cash generated from operations 42 2,351 3,844
Interest paid on hire
purchase obligations (299) (244) (501)
____ ____ ____
Net cash flows from operating
activities (257) 2,107 3,343
Condensed consolidated Unaudited Unaudited Audited year
cash flow statement 6 months ended 6 months ended ended 30 November
31 May 2018 31 May 2017 2017
GBP'000 GBP'000 GBP'000
Cash flows from investing
activities
Acquisitions of businesses (2,007) - (3,329)
Purchases of property,
plant and equipment (752) (616) (1,799)
Sale of property, plant
and equipment 512 445 1,002
_____ _____ _____
Net cash flows used in
investing activities (2,247) (171) (4,126)
Cash flow from financing
activities
Shares issued - - 3,362
Dividends paid (408) (338) (970)
Proceeds of mortgage
and other bank loans 17,879 - 1,105
Repayment of bank loans (14,970) (350) (722)
Bank loan interest paid (460) (373) (740)
Hire purchase refinancing
receipts 1,681 140 717
Capital settlement payments
on vehicles sold (137) - (240)
Capital element of lease
payments (1,784) (1,853) (3,086)
_____ _____ ____
Net cash generated from/(used
in) financing activities 1,801 (2,774) (574)
Net decrease in cash
and cash equivalents (703) (838) (1,357)
Cash and cash equivalents
at start of period (1,699) (342) (342)
_____ _____ _____
Cash and cash equivalents
at end of period (2,402) (1,180) (1,699)
====== ===== ====
Notes to the Unaudited Consolidated Interim Financial Statements
for the six months ended 31 May 2018
1. Basis of preparation:
The unaudited condensed consolidated interim financial
statements have been prepared using the accounting policies set out
in the group's 2017 statutory financial statements.
The financial statements of the group for the full year are
prepared in accordance with IFRS's as adopted by the European Union
and these interim financial statements have been prepared in
accordance with IAS 34 "Interim Financial Reporting".
2. Turnover:
Revenue represents sales to external customers excluding value
added tax. All of the activities of the group are conducted in the
United Kingdom within the operating segment of provision of bus
services. Management monitors revenue across the following business
streams: contracted services, commercial services and charter
services.
Six months Six months Year ended
ended 31 ended 31 30 November
May 2018 May 2017 2017
GBP'000 GBP'000 GBP'000
Contracted 11,825 10,420 21,415
Commercial 20,140 16,932 33,702
Charter 748 1,275 2,789
Total 32,713 28,627 57,906
=========== =========== =============
3. Profit before taxation:
Profit before taxation includes the following:
Unaudited Unaudited Audited
6 months 6 months year ended
ended 31 ended 31 30 November
May May 2017
2018 2017
GBP'000 GBP'000 GBP'000
Amortisation of intangible
assets (153) - (19)
Abortive transaction costs (94) - -
Costs of change of principal
bankers (31) - (58)
Revenue debtor written
off - - (477)
Costs of acquisition and
integration (271) (94) (384)
Share based payment expense (2) (10) (20)
Mark to market provision
on fuel derivatives 587 (304) 162
Profit/(loss) within profit
before taxation 36 (408) (796)
4. Earnings per share:
Basic earnings per share have been calculated on the basis of
profit after taxation and the weighted average number of shares in
issue for the period of 48,026,580 (May 2017: 42,193,246; November
2017: 44,001,465). Diluted earnings per share have been calculated
on the basis of profit after taxation and the weighted average
number of shares in issue (including such potential issues as are
dilutive) for the period of 48,095,501 (May 2017: 42,253,839;
November 2017: 44,112,629).
Basic adjusted and diluted adjusted earnings per share before
exceptional items have been calculated using the same weighted
average numbers of shares in issue, but on the basis of profits
after tax and before any exceptional items. This is done in order
to aid comparability between the accounting periods.
5. Property, plant and equipment
Freehold Long and Public
land and short Plant service
buildings leasehold and vehicles Total
property machinery
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cost:
At 1 December
2016 7,351 1,084 3,672 42,837 54,944
Acquisitions 585 - 45 1,192 1,822
Additions 14 4 1,266 3,302 4,586
Disposals (270) - (95) (1,678) (2,043)
At 30 November
2017 7,680 1,088 4,888 45,653 59,309
Acquisition - - 20 1,462 1,482
Additions 280 - 530 2,132 2,942
Transfers (5) - 5 - -
Disposals - - (286) (779) (1,065)
At 31 May 2018 7,955 1,088 5,157 48,468 62,668
Depreciation:
At 1 December
2016 364 201 1,360 18,143 20,068
Charge for the
year 62 29 303 2,880 3,274
Acquisitions 35 - 45 450 530
Disposals (35) - (95) (1,358) (1,488)
At 30 November
2017 426 230 1,613 20,115 22,384
Charge for the
period 30 14 182 1,499 1,725
Disposals - - (225) (569) (794)
At 31 May 2018 456 244 1,570 21,045 23,315
Net book value:
At 31 May 2018 7,499 844 3,587 27,423 39,353
At 30 November
2017 7,254 858 3,275 25,538 36,925
6. Loans and borrowings:
At 31 May At 31 May At 30 November
2018 2017 2017
GBP'000 GBP'000 GBP'000
Current:
Overdrafts 2,916 2,127 2,326
Bank loans (secured) 278 5,250 4,952
Bank loans (unsecured) 11,377 7,895 9,000
14,571 15,272 16,278
Non- current:
Bank loans (secured) 5,204 - -
Total loans and borrowings 19,775 15,272 16,278
Secured bank loans are mortgage-type loans secured by reference
to the group's freehold property.
7. Obligations under hire purchase agreements:
All finance leases are secured by the lessors' rights over the
respective leased assets which consist principally of passenger
service vehicles.
At 31 May At 31 May At 30 November
2018 2017 2017
GBP'000 GBP'000 GBP'000
Present value:
Not later than one
year 3,682 2,871 3,158
More than one but less
than two years 3,211 2,741 2,962
More than two but less
than five years 5,672 4,828 4,792
Later than five years 957 934 603
---------- ---------- ---------------
13,522 11,374 11,515
8. Acquisition of Central Buses:
As set out in the Chairman's Statement, in February 2018 the
Group acquired the bus business of CEN Group Limited, trading under
the name of Central Buses. The Chairman's Statement describes the
details of and the reasons for the acquisition and should be
consulted for a detailed description of all the relevant factors.
The consideration for this acquisition was GBP1.95 million in cash.
The book values of the assets acquired are set out below.
Book value Fair value Fair value
adjustments on acquisition
GBP'000 GBP'000 GBP'000
Fixed assets
Plant and machinery 20 - 20
Vehicles 1,462 - 1,462
Customer contracts - 432 432
Total fixed assets 1,482 432 1,914
----------- ------------- ----------------
Current liabilities
Other payables and
accruals - - (27)
- - (27)
----------- ------------- ----------------
Net assets 1,887
Goodwill 71
Acquisition costs 49
----------------
2,007
Total cash consideration
paid
================
Pre-acquisition book values were determined based on applicable
IFRS, immediately prior to the acquisition. The values of assets
recognised on acquisition are their estimated fair values. The
directors engaged Crowe Clark Whitehill LLP ("CCW") to make an
assessment of the values of the intangible assets acquired with the
business. Principally this involved an assessment of the value of
the intangible asset attributable to the contracts inherited with
the business. The value estimated by CCW is reflected in the above
table.
The directors do not consider that the brand name has any
separable value. No licenses were acquired with the business. The
sales and purchase agreement included standard non-compete clauses;
however, the seller had no intention of re-entering the respective
market at the acquisition date and so there could be no value
attributable to these clauses. The goodwill generated by the
acquisition arose from the benefit of synergies with the existing
businesses of the group in their respective locations. As stated
above the business acquired included a vehicle fleet and these
vehicles were immediately subsumed into existing operations
following acquisition.
9. Dividends:
On 8 December 2017 the company paid an interim dividend of 0.85
pence per share in respect of the year ended 30 November 2017; a
final dividend in respect of the year was paid on 29 June 2018 at a
rate of 1.65 pence per share. All dividends are payable in cash
only.
10. Additional information:
The unaudited Consolidated Interim Report was approved by the
Board of Directors on 8 August 2018. The consolidated interim
financial information for the six months ended 31 May 2018 and for
the six months ended 31 May 2017 is unaudited. The financial
information in this interim announcement does not constitute
statutory accounts within the meaning of Section 434 of the
Companies Act 2006. The statutory accounts of Rotala Plc for the
year ended 30 November 2017 have been reported on by the company's
auditors and have been delivered to the Registrar of Companies. The
report of the auditors on these accounts was unqualified, did not
contain an emphasis of matter and did not include a statement under
section 498 of the Companies Act 2006.
11. Copies of this statement are available from the registered
office of the company at Rotala Group Headquarters, Cross Quays
Business Park, Hallbridge Way, Tividale, Oldbury, West Midlands,
B69 3HW or the Company's website www.rotalaplc.com.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR BLGDICSGBGII
(END) Dow Jones Newswires
August 09, 2018 02:00 ET (06:00 GMT)
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