TIDMSMJ
RNS Number : 5403M
Smart(J.)&Co(Contractors) PLC
30 April 2018
J. SMART & CO. (CONTRACTORS) PLC
INTERIM REPORT
FOR THE SIX MONTHS TO
31st JANUARY 2018
J SMART & CO. (CONTRACTORS) PLC
CHAIRMAN'S REVIEW
INTERIM REPORT
Unaudited Group profit for the six months to 31st January 2018
amounted to GBP921,000 compared with GBP652,000 for the
corresponding period last year. Group turnover decreased by
31%.
In accordance with our normal practice, there has been no
revaluation of our investment properties at the end of the half
year. We believe that a half year revaluation would have had no
substantial effect on the figures.
There were no private residential sales this half year as the
first completions at our current private housing development at
West Bowling Green Street, Edinburgh are not due until after the
end of the current financial year.
The second phases of the industrial developments at Inchwood
Park, Bathgate and West Edinburgh Business Park are now
complete.
Our serviced office company, Smart Serviced Offices Limited, has
refurbished a further suite at Links Place, Leith, Edinburgh to
provide co-working accommodation.
The current site progress is satisfactory.
INTERIM DIVID
The Board announces an interim dividend of 0.95p per share
(2017, 0.95p) to be paid on 1st June 2018 to shareholders on the
register at the close of business on 11th May 2018. The interim
dividend will cost the Company no more than GBP423,000.
FUTURE PROSPECTS
We have less work in hand in contracting than the same time last
year. Margins are no better than last year. Our social housing
contract at Ferrymuir, as predicted, has been unnecessarily
delayed, but will start imminently.
There will be no private residential sales this financial year,
but the interest in the first release of flats at West Bowling
Green Street has been positive.
The letting and re-letting of the majority of our industrial
properties continues to be buoyant. The first phase of our joint
venture industrial development at Gartcosh is due to start in the
near future. Lettings of our office properties has seen a welcome,
but marginal, improvement.
It is not possible to make an accurate forecast of the year end
figures, but it is evident that our reduced turnover will result in
the underlying profit for the financial year being less than the
previous year.
D.W. SMART
30th April 2018 Chairman
CONSOLIDATED INCOME STATEMENT
6 Months 6 Months Year
ended ended ended
31.1.18 31.1.17 31.7.17
Notes (Unaudited) (Unaudited) (Audited)
GBP000 GBP000 GBP000
Group construction activities 8,390 12,195 25,419
Less: Own construction
work capitalised (1,623) (209) (2,559)
------------- ------------- -----------
REVENUE 6,767 11,986 22,860
Cost of sales (5,246) (11,240) (19,406)
------------- ------------- -----------
GROSS PROFIT 1,521 746 3,454
Other operating income 2,898 2,941 6,090
Net operating expenses (3,569) (3,119) (6,925)
------------- ------------- -----------
OPERATING PROFIT BEFORE
PROFIT ON SALE AND NET
SURPLUS ON VALUATION
OF INVESTMENT PROPERTIES 850 568 2,619
Profit arising on sale
of investment properties - - 613
Net surplus on valuation
of investment properties - - 614
------------- ------------- -----------
OPERATING PROFIT 850 568 3,846
Share of profits in Joint
Ventures 14 20 42
Income from available
for sale financial assets 16 10 32
Profit on sale of available
for sale financial assets - 6 22
Finance income 41 48 95
------------- ------------- -----------
PROFIT BEFORE TAX 921 652 4,037
Taxation 5 (180) (135) (310)
------------- ------------- -----------
PROFIT ATTRIBUTABLE TO
EQUITY SHAREHOLDERS 741 517 3,727
------------- ------------- -----------
EARNINGS PER SHARE -
BASIC AND DILUTED 7 1.66p 1.14p 8.26p
------------- ------------- -----------
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
6 Months 6 Months Year
ended ended ended
31.1.18 31.1.17 31.7.17
(Unaudited) (Unaudited) (Audited)
GBP000 GBP000 GBP000
Profit for the period 741 517 3,727
------------- ------------- -----------
Other comprehensive income
Items that may be subsequently reclassified
to Income Statement:
Fair value adjustment of
available for sale financial
assets 38 34 65
Total items which may be
subsequently reclassified
to Income Statement 38 34 65
------------- ------------- -----------
Items that will not be subsequently
reclassified to Income Statement:
Actuarial gain recognised
in defined benefit
pension scheme - - 3,306
Deferred taxation on actuarial
gain - - (680)
------------- ------------- -----------
Total items that will not
be subsequently reclassified
to Income Statement - - 2,626
------------- ------------- -----------
Total other comprehensive
income 38 34 2,691
------------- ------------- -----------
TOTAL COMPREHENSIVE INCOME
FOR THE PERIOD, NET OF TAX 779 551 6,418
------------- ------------- -----------
ATTRIBUTABLE TO EQUITY SHAREHOLDERS 779 551 6,418
------------- ------------- -----------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Capital Fair
Share Redemption Value Retained
Notes Capital Reserve Reserve Earnings Total
GBP000 GBP000 GBP000 GBP000 GBP000
As at 1st August
2017 896 112 9 92,841 93,858
Profit for the
period - - - 741 741
Other comprehensive
income - - 38 - 38
Total comprehensive
income for period - - 38 741 779
--------- ------------ --------- ---------- --------
TRANSACTIONS WITH OWNERS, RECORDED DIRECTLY
IN EQUITY
Shares purchased
and cancelled (5) - - (256) (261)
Transfer to Capital
Redemption Reserve - 5 - (5) -
Dividends 6 - - - (967) (967)
--------- ------------ --------- ---------- --------
Total transactions
with owners (5) 5 - (1,228) (1,228)
--------- ------------ --------- ---------- --------
As at 31st January
2018 891 117 47 92,354 93,409
--------- ------------ --------- ---------- --------
Capital Fair
Share Redemption Value Retained
Notes Capital Reserve Reserve Earnings Total
GBP000 GBP000 GBP000 GBP000 GBP000
As at 1st August
2016 906 102 (56) 87,884 88,836
Profit for the
period - - - 517 517
Other comprehensive
income - - 34 - 34
Total comprehensive
income for period - - 34 517 551
--------- ------------ --------- ---------- -------
TRANSACTIONS WITH OWNERS, RECORDED DIRECTLY
IN EQUITY
Shares purchased
and cancelled (3) - - (178) (181)
Transfer to Capital
Redemption Reserve - 3 - (3) -
Dividends 6 - - - (418) (418)
--------- ------------ --------- ---------- -------
Total transactions
with owners (3) 3 - (599) (599)
--------- ------------ --------- ---------- -------
As at 31st January
2017 903 105 (22) 87,802 88,788
--------- ------------ --------- ---------- -------
Capital Fair
Share Redemption Value Retained
Notes Capital Reserve Reserve Earnings Total
GBP000 GBP000 GBP000 GBP000 GBP000
As at 1st August
2016 906 102 (56) 87,884 88,836
Profit for the
period - - - 3,727 3,727
Other comprehensive
income - - 65 2,626 2,691
Total comprehensive
income for period - - 65 6,353 6,418
--------- ------------ --------- ---------- --------
TRANSACTIONS WITH OWNERS, RECORDED DIRECTLY
IN EQUITY
Shares purchased
and cancelled (10) - - (540) (550)
Transfer to Capital
Redemption Reserve - 10 - (10) -
Dividends 6 - - - (846) (846)
--------- ------------ --------- ---------- --------
Total transactions
with owners (10) 10 - (1,396) (1,396)
--------- ------------ --------- ---------- --------
As at 31st July
2017 896 112 9 92,841 93,858
--------- ------------ --------- ---------- --------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
6 Months 6 Months Year
ended ended ended
31.1.18 31.1.17 31.7.17
(Unaudited) (Unaudited) (Audited)
GBP000 GBP000 GBP000
NON-CURRENT ASSETS
Property, plant and
equipment 1,406 1,365 1,431
Investment properties 66,435 64,937 64,799
Investments in Joint
Ventures 319 283 305
Available for sale financial
assets 1,041 1,003 1,000
Retirement benefit surplus 3,862 33 3,862
Deferred tax assets 58 41 58
------------- ------------- -----------
73,121 67,662 71,455
------------- ------------- -----------
CURRENT ASSETS
Inventories 5,241 2,804 2,881
Trade and other receivables 5,500 6,557 5,723
Monies held on deposit 4,045 4,529 2,536
Cash and cash equivalents 24,734 26,013 26,524
------------- ------------- -----------
39,520 39,903 37,664
------------- ------------- -----------
TOTAL ASSETS 112,641 107,565 109,119
------------- ------------- -----------
NON-CURRENT LIABILITIES
Deferred tax liabilities 1,926 1,389 1,923
------------- ------------- -----------
CURRENT LIABILITIES
Trade and other payables 4,297 4,731 4,385
Corporation tax liability 151 121 162
Bank overdraft 12,858 12,536 8,791
------------- ------------- -----------
17,306 17,388 13,338
------------- ------------- -----------
TOTAL LIABILITIES 19,232 18,777 15,261
------------- ------------- -----------
NET ASSETS 93,409 88,788 93,858
------------- ------------- -----------
EQUITY
Called up share capital 891 903 896
Capital redemption reserve 117 105 112
Fair value reserve 47 (22) 9
Retained earnings 92,354 87,802 92,841
------------- ------------- -----------
TOTAL EQUITY 93,409 88,788 93,858
------------- ------------- -----------
CONSOLIDATED STATEMENT OF CASH FLOWS
6 Months 6 Months Year
ended ended ended
31.1.18 31.1.17 31.7.17
Notes (Unaudited) (Unaudited) (Audited)
GBP000 GBP000 GBP000
CASH FLOWS FROM OPERATING
ACTIVITIES 9 (1,208) 34 2,205
Tax paid (191) (157) (454)
------------- ------------- -----------
NET CASH FLOWS FROM
OPERATING ACTIVITIES (1,399) (123) 1,751
------------- ------------- -----------
CASH FLOWS FROM INVESTING
ACTIVITIES
Additions to property,
plant and equipment (183) (189) (487)
Additions to investment
properties (13) - (20)
Expenditure on own work
capitalised - investment
properties (1,623) (209) (2,559)
Sale of property, plant
and equipment 57 39 70
Sale of investment properties - - 3,735
Purchase of available
for sale financial assets - (674) (674)
Proceeds of sale of available
for sale financial assets - 37 87
(Increase)/decrease
in monies held on deposit (1,509) 990 2,983
Interest received 41 48 86
NET CASH FLOWS FROM
INVESTING ACTIVITIES (3,230) 42 3,221
------------- ------------- -----------
CASH FLOWS FROM FINANCING
ACTIVITIES
Purchase of own shares (261) (181) (550)
Dividends paid (967) (418) (846)
------------- ------------- -----------
NET CASH FLOWS FROM
FINANCING ACTIVITIES (1,228) (599) (1,396)
------------- ------------- -----------
(DECREASE)/INCREASE
IN CASH AND CASH EQUIVALENTS (5,857) (680) 3,576
------------- ------------- -----------
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 17,733 14,157 14,157
------------- ------------- -----------
CASH AND CASH EQUIVALENTS
AT OF PERIOD 11,876 13,477 17,733
------------- ------------- -----------
NOTES TO INTERIM FINANCIAL STATEMENTS
1. BASIS OF PREPARATION
J. Smart & Co. (Contractors) PLC is a company domiciled in
the United Kingdom. The condensed consolidated interim financial
statements of the Company for the six months ended 31st January
2018 comprise the Company and its Subsidiaries, together referred
to as the Group, and the Group's interest in jointly controlled
entities.
The condensed consolidated interim financial statements for the
six months to 31st January 2018 have been prepared in accordance
with the Disclosure and Transparency Rules of the Financial Conduct
Authority and with IAS 34: Interim Financial Reporting as adopted
by the European Union.
The condensed consolidated interim financial statements for the
six months to 31st January 2018 do not constitute statutory
accounts as defined in Section 434 of the Companies Act 2006. The
condensed consolidated interim financial statements should be read
in conjunction with the annual financial statements for the year to
31st July 2017, which have been prepared in accordance with
International Financial Reporting Standards as adopted by the
European Union.
The statutory financial statements for the year to 31st July
2017 have been filed with the Registrar of Companies and a copy may
be obtained from Companies House. These have been audited and
contain an unqualified audit opinion, did not draw attention to any
matters by way of emphasis and did not contain a statement under
Section 498 of the Companies Act 2006.
The condensed consolidated interim financial statements have not
been audited or reviewed by the Company's auditor. A copy of the
interim financial statements will be available on the Company's
website www.jsmart.co.uk.
2. ACCOUNTING POLICIES
The condensed consolidated interim financial statements have
been prepared under the historical cost convention except where the
measurement of balances at fair value is required for investment
properties, available for sale financial assets and assets held by
defined benefit pension scheme.
The accounting policies adopted are consistent with those
followed in the preparation of the Group's annual financial
statements for the year ended 31st July 2017, with the exception of
the policies regarding the accounting for pension scheme
obligations and investment properties revaluations.
For the condensed consolidated interim financial statements the
assets and liabilities of the pension scheme are estimated to be
unchanged from the values included at the previous year end. Also,
in accordance with long standing practice, the Group's investment
properties are revalued annually on 31st July each year. No
revaluation adjustment is made in the condensed consolidated
interim financial statements.
Interpretations effective in period
The following new standards, amendments to standards and
interpretations relevant to the Group were issued by the
International Accounting Standards Board and are mandatory for the
Group for the first time in the financial year to 31st July
2018:
-- IAS 7 (amended): Statement of Cash Flows.
-- IAS 12 (amended): Income Taxes.
The Directors anticipate that there will be no material effect
on the financial statements from these Standards.
Estimates and assumptions
The preparation of the condensed consolidated interim financial
statements requires management to make estimates and assumptions
concerning the future that may affect the application of accounting
policies and the reported amounts of assets, liabilities and income
and expenses. Management believes that the estimates and
assumptions used in the preparation of these accounts are
reasonable. However, actual outcomes may differ from those
anticipated.
Going concern
The Directors have a reasonable expectation that the Company and
Group as a whole have adequate resources to continue in operational
existence for the foreseeable future, being a period of not less
than twelve months from the date of these accounts. For this
reason, the Directors continue to adopt the going concern basis in
preparing the condensed consolidated interim financial
statements.
3. PRINCIPAL RISKS AND UNCERTAINTIES
The principal risks and uncertainties which could have a
material impact on the Group's performance for the remainder of the
current financial year remain the same as those detailed in the
Group's Annual Report and Financial Statements for the year to 31st
July 2017.
4. SEGMENTAL INFORMATION
The Group has identified operating segments on the basis of
internal reporting components that are regularly reviewed by the
chief operating decision maker to allow the allocation of resources
to segments and assess their performance. The Board of Directors
has been recognised as the chief operating decision maker.
All revenue arises from activities within the UK and therefore
the Board of Directors does not consider the business from a
geographical perspective. The operating segments are based on
activity and performance of an operating segment is based on a
measure of operating results.
External Internal Total Operating Profit/(Loss)
Revenue Revenue Revenue
31.1.18 31.1.17 31.7.17
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
31st JANUARY 2018
(Unaudited)
Construction activities 6,767 1,623 8,390 (632) - -
Investment activities 2,898 - 2,898 1,482 - -
--------- --------- --------- -------- -------- --------
9,665 1,623 11,288 850 - -
--------- --------- --------- -------- -------- --------
31st JANUARY 2017
(Unaudited)
Construction activities 11,986 209 12,195 - (1,158) -
Investment activities 2,941 - 2,941 - 1,726 -
--------- --------- --------- -------- -------- --------
14,927 209 15,136 - 568 -
--------- --------- --------- -------- -------- --------
31st JULY 2017
(Audited)
Construction activities 22,860 2,559 25,419 - - (673)
Investment activities 6,090 - 6,090 - - 4,519
--------- --------- --------- -------- -------- --------
28,950 2,559 31,509 - - 3,846
--------- --------- --------- -------- -------- --------
OPERATING PROFIT 850 568 3,846
Share of results
of Joint Ventures 14 20 42
Finance and investment income and
profit on sale of available
for sale financial assets 57 64 149
PROFIT BEFORE TAX ON ORDINARY ACTIVITIES 921 652 4,037
-------- -------- --------
5. TAXATION
The tax charge for the 6 months to 31st January 2018 is based on
the corporation tax rate at 19.00% (2017, 19.67%).
6. DIVIDS
6 Months 6 Months Year
Ended Ended Ended
31.1.18 31.1.17 31.7.17
(Unaudited) (Unaudited) (Audited)
GBP000 GBP000 GBP000
ORDINARY DIVIDS
2017 Final dividend of 2.17p 967 - -
2017 Interim dividend of 0.95p - - 428
2016 Final dividend of 2.15p,
after waivers - 418 418
------------- ------------- -----------
967 418 846
------------- ------------- -----------
The interim dividend of 0.95p per share for the year to 31st
July 2018 will be paid on 1st June 2018 to shareholders on the
register at 11th May 2018. The interim dividend will cost the
Company no more than GBP423,000.
7. EARNINGS PER SHARE
6 Months 6 Months Year
Ended Ended Ended
31.1.18 31.1.17 31.7.17
(Unaudited) (Unaudited) (Audited)
Profit attributable to equity
shareholders (GBP000) 741 517 3,727
------------- ------------- -------------
Basic earnings per share 1.66p 1.14p 8.26p
------------- ------------- -------------
Weighted average number of
shares 44,624,268 45,216,991 45,098,697
------------- ------------- -------------
Basic earnings per share are calculated by dividing the profit
attributable to equity shareholders by the weighted average number
of shares in issue during the period.
During the 6 months to 31st January 2018 the Company purchased
for immediate cancellation 236,000 Ordinary Shares of 2p.
There is no difference between basic and diluted earnings per
share.
8. FAIR VALUE ASSETS
The Group's investment properties, available for sale financial
assets and assets held by defined benefit pension scheme are
measured at fair value after initial recognition.
Investment properties are only valued annually by the Directors
at the year end and not for the purposes of the interim financial
statements. The Group considers all of its investment properties
fall within 'Level 3' of the fair value hierarchy as described by
IFRS 13: Fair Value Measurement. Level 3 valuations are those using
inputs for the asset or liability that are not based on observable
market data. The main unobservable inputs relate to estimated
rental value and equivalent yield.
The Group's available for sale financial assets consisted
entirely of equities of companies listed on quoted markets which
fall within 'Level 1' of the fair value hierarchy. Assets held by
defined benefit pension scheme consist of equities and bond of
companies listed on quoted markets and cash which all fall within
'Level 1' of the fair value hierarchy. Level 1 valuations are those
using inputs which are quoted prices (unadjusted) in active markets
for identical assets or liabilities the Company can access at the
period end date.
9. RECONCILIATION OF PROFIT BEFORE TAX TO CASH FLOWS FROM
OPERATING ACTIVITIES
6 Months 6 Months Year
ended ended ended
31.1.18 31.1.17 31.7.17
(Unaudited) (Unaudited) (Audited)
GBP000 GBP000 GBP000
Profit before tax 921 652 4,037
Share of profits from Joint
Ventures (14) (20) (42)
Depreciation 188 185 407
Unrealised valuation surplus
on investment properties - - (614)
Profit on sale of property,
plant and equipment (37) (18) (39)
Profit on sale of investment
properties - - (613)
Profit on sale of available
for sale financial assets - (6) (22)
Change in retirement benefits - - (523)
Interest received (41) (48) (86)
Change in inventories (2,360) (120) (197)
Change in receivables 223 (188) 646
Change in payables (88) (403) (749)
------------- ------------- -----------
CASH FLOWS FROM OPERATING
ACTIVITIES (1,208) 34 2,205
------------- ------------- -----------
10. RELATED PARTY TRANSACTION
Related parties are consistent with those disclosed in the
Group's Annual Report and Statement of Accounts for the year to
31st July 2017.
Related party transactions, including salary and benefits
provided to Directors and key management, were not material to the
financial position or performance of the Group for the period.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors named below, confirm on behalf of the Board of
Directors that to the best of their knowledge that the condensed
consolidated interim financial statements for the six months to
31st January 2018 have been prepared in accordance with IAS 34:
Interim Financial Reporting as adopted by the European Union. The
condensed consolidated interim financial statements include a fair
review of the information required by Disclosure and Transparency
Rules 4.2.7 and 4.2.8, being:
-- an indication of important events that have occurred during
the six months to 31st January 2018 and their impact on the
condensed consolidated interim financial statements, and a
description of the principal risks and uncertainties for the
remaining six months of the financial year, and
-- material related party transactions in the six months to 31st
January 2018 and any material changes in the related party
transactions described in the last annual report.
The Directors of the Company are listed in the Annual Report and
Statement of Accounts for the year to 31st July 2017.
By order of
the Board
D.W. SMART, J.R. SMART, Director
Director
30th April 2018
This information is provided by RNS
The company news service from the London Stock Exchange
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