News ReleaseTuesday 25 November 2008, 7:00 GMT
|
|
Half-yearly Report
London, November 24 /PRNewswire/ --
PSG Solutions plc INTERIM REPORT 2008 PSG Solutions plc's main business is the Property Search Group (`PSG'). Through its exclusive franchised national distribution channel it is a major provider of residential property search reports to the conveyancing marketplace in England and Wales. It is also one of the leading providers of Home Information Packs (`HIPs') which, in January this year were made a mandatory prerequisite for all home sales. PSG's franchisee network provides a local personalised service that is backed by a well respected National Brand. Audiotel International Limited (`Audiotel') is Europe's leading brand manufacturer of audio surveillance and audio counter surveillance equipment mainly to state agencies. It has a portfolio of products and brands that are well respected throughout the industry in all parts of the world. Moore & Buckle (Flexible Packaging) Limited (`M&B') provides specialist engineered flexible packaging solutions. highlights - Profit before taxation £1.290m (2007: £1.475m). - The drop in profits reflected a fall of 50% in PSG's operating profit from £ 1.556m to £775,000. By contrast Audiotel's operating profits were £469,000 (2007: £45,000 loss). Moore & Buckle's operating profits were £110,000 (2007: £ 221,000). - Cash flow remained positive with net cash in excess of £3m at the end of the period. - PSG has become a leading provider of HIPs, though its share of this market is significantly smaller than for search, due to easier access to the HIPs market for competitors. - The halving in the number of housing transactions, along with the structural changes as a consequence of HIPs has both reduced volumes and profit margins substantially. The resultant turmoil in the industry will continue to have an even sharper negative effect upon the future trading of both PSG and its competitors. - PSG is reviewing its strategy and cost base to meet the current challenges to protect its profitability. It has established PSG Energy to provide Energy Assessment related services to both commercial and residential markets utilising the strength of the PSG franchisee network to expand this new operation as quickly as possible. Copies of the Interim Report will be distributed to shareholders shortly and will also be available on the company's website, www.psgsols.com. Enquiries Jonathan Mervis, Chairman PSG Solutions plc 020 7881 0800 Geoff Nash FinnCap 020 7600 1658 Chairman's statement for the six months ended 30 September 2008 PSG As mentioned, PSG has become one of the leading suppliers of HIPs. During the period under review HIPs have been a mandatory prerequisite for all sales of residential property in England and Wales. Previously PSG's market for Property Searches had been mainly within the gift of around 4,000 high street solicitors, who were PSG's long standing widely dispersed customer base. The HIPs regulations transferred the initiative for ordering a HIP, (which now must include the Property Search within the HIP) mainly to estate agents and chain conveyancers. As a result, PSG no longer has its traditional solicitor customer base for Property Search, and also faces competition from a wide constituency of HIP providers. At present as the volume of total home sales continues to fall with margins also being squeezed, PSG continues to review its cost base to ensure optimum profitability in the current deteriorating trading conditions. PSG Energy has been recently established to provide Energy Assessment related services for commercial and domestic properties. PSG's national coverage through its well established network of franchisees should make it well placed to secure new and more profitable business especially in the commercial arena where PSG's infrastructure, size and focus on quality provide it with advantages over a number of other competitors joining the marketplace. Audiotel The performance of Audiotel has been more encouraging with an operating profit of around £500,000. This was due to two major orders from Asia for various products in Audiotel's counter surveillance range, and for orders from Canada (Royal Canadian Mounted Police) and the USA for Audiotel's latest "Stealth" surveillance equipment. Further new developments in Audiotel's counter surveillance range are soon to be released with a new model Scanlock M3 ready to be marketed globally early in 2009. This new model outperforms the Scanlock M2 in many areas and will provide opportunities for new sales and also upgrades to an existing loyal customer base. Whilst customer orders remain unpredictable, continuous product development has enhanced the prospects for increasing turnover. Orders for the new Stealth Evolution surveillance range have been encouraging emanating from both UK and foreign law enforcement agencies. Audiotel continues to have the capacity to handle substantially increased turnover on the same cost base. M & B Although this niche market packaging solutions business traded profitably, it did so at a reduced level, halving its operating profit during the period. There is no indication that trading will improve for the full year. Outlook The market for search and HIPS remains weak and extremely competitive making it difficult for decent returns to be made. The early development of PSG Energy should strengthen the overall product offering and enable diversification into new markets although such diversification will not flow through to profits for some time. The future profitability levels of Audiotel and Moore & Buckle are uncertain due to the downturn in the global economy. Overall conditions for the Group remain challenging. Whilst results for the first half showed a reasonable level of profitability this is not expected to be repeated in the second half, and thus results for the year to 31 March 2009 will be significantly less than current market expectations. Jonathan Mervis Chairman 25th November 2008 Consolidated income statement for the six months ended 30 September 2008 Six Six months months Year ended ended ended 30 30 31 September September March 2008 2007 2008 Unaudited Unaudited Audited Notes £ 000 £ 000 £ 000 Revenue Continuing operations 6,208 6,772 14,467 Cost of sales (2,052) (2,974) (6,915) Gross profit 4,156 3,798 7,552 Administrative expenses (3,018) (2,314) (4,342) Operating profit before 1,138 1,484 3,210 exceptional items Exceptional administrative 4 81 (34) (28) credits/ (expenses) Operating profit Continuing operations 1,219 1,450 3,182 Finance costs (54) (74) (133) Finance income 125 99 192 Profit on ordinary activities 1,290 1,475 3,241 before taxation Taxation (405) (420) (809) Profit on ordinary activities 885 1,055 2,432 after taxation Basic earnings per share 5 3.46 p 3.92 p 9.16 p Diluted earnings per share 3.41 p 3.84 p 8.99 p The company has no recognised gains or losses other than the profit for the current and prior period/year. Consolidated statement of changes in equity for the six months ended 30 September 2008 Share Retained Special Share Capital Earnings reserve Premium Total £ 000 £ 000 £ 000 £ 000 £ 000 At 1 April 2007 5,437 2,334 - 8,530 16,301 Purchase of ordinary share capital for treasury - (176) - - (176) Share based payments - 97 - - 97 Deferred tax on share - (1) - - ( ) based payments Net profit for the - 1,055 - - 1,055 period At 30 September 2007 5,437 3,309 - 8,530 17,276 At 1 October 2007 5,437 3,309 - 8,530 17,276 Purchase of ordinary share capital for treasury - (237) - - (237) Share based payments - 84 - - 84 Deferred tax on share - (10) - - (10) based payments Net profit for the - 1,377 - - 1,377 period At 31 March 2008 5,437 4,523 - 8,530 18,490 At 1 April 2008 5,437 4,523 - 8,530 18,490 Transfer of share premium to special reserve - - 8,530 (8,530) - Purchase of ordinary share capital for treasury - (615) - - (615) Share based payments - 21 - - 21 Deferred tax on share - (1) - - (1) based payments Net profit for the - 885 - - 885 period At 30 September 2008 5,437 4,813 8,530 - 18,780 Consolidated balance sheet at 30 September 2008 30 30 31 September September March 2008 2007 2008 Unaudited Unaudited Audited £ 000 £ 000 £ 000 Non-current assets Goodwill 13,028 12,905 13,028 Other intangible assets 489 535 512 Property, plant and equipment 590 520 615 Financial assets 300 479 300 14,407 14,439 14,455 Current assets Inventories 695 672 591 Trade and other receivables 2,684 3,210 4,390 Derivative financial instruments - 77 - Current tax asset - - 7 Deferred tax asset 90 99 142 Cash and cash equivalents 4,568 4,071 3,939 8,037 8,129 9,069 Current liabilities Trade and other payables (1,895) (2,030) (2,836) Borrowings (551) (553) (552) Current tax liability (353) (1,272) (514) (2,799) (3,855) (3,902) Net current assets 5,238 4,274 5,167 Total assets less current 19,645 18,713 19,622 liabilities Non-current liabilities Borrowings (865) (1,387) (1,132) Deferred tax payable - (50) - Net assets 18,780 17,276 18,490 Represented by: Capital and reserves attributable to equity holders Called up share capital 5,437 5,437 5,437 Share premium account - 8,530 8,530 Special reserve account 8,530 - - Retained earnings 4,813 3,309 4,523 Total equity 18,780 17,276 18,490 Consolidated cash flow statement for the six months ended 30 September 2008 Six months Six months Year ended ended ended 30 30 31 September September March 2008 2007 2008 Unaudited Unaudited Audited £ 000 £ 000 £ 000 Cash flows from operating activities Profit before taxation 1,290 1,475 3,241 Adjustments for: Depreciation of plant and 65 64 131 equipment Amortisation of other intangible 190 92 231 assets Loss on interest rate swap - - 32 (Profit) on disposal of tangible - - (2) assets Loss on disposal of financial - 34 28 assets Interest expense 54 74 133 Interest receivable (125) (99) (223) Share based payment expense 22 97 181 Decrease/(increase) in receivables 1,706 500 (717) (Increase) in inventories (104) (87) (6) (Decrease)/increase in payables (941) (565) 242 Cash generated from operations 2,157 1,585 3,271 Interest paid (54) (74) (133) Income tax paid (509) (53) (1,311) Net cash from operating activities 1,594 1,458 1,827 Cash flow from investing activities Payment of deferred consideration - (330) (330) Payment to acquire goodwill - - (87) Purchase of tangible assets (40) (59) (230) Purchase of other intangible assets (168) (246) (362) Proceeds from the sale of tangible - - 11 assets Proceeds from the sale of financial - 136 322 assets Interest rate swap proceeds - - 52 received Interest received 125 105 223 Net cash from investing activities (83) (394) (401) Cash flows from Financing activities Purchase of own shares (614) (176) (413) Payment of debt (268) (248) (505) Net cash used in financing (882) (424) (918) activities Net increase in cash and cash 629 640 508 equivalents Cash and cash equivalents at 3,939 3,431 3,431 beginning of period Cash and cash equivalents at end of 4,568 4,071 3,939 period Note - analysis of net funds 30 September 30 September 31 March 2008 2007 2008 Unaudited Unaudited Audited £ 000 £ 000 £ 000 Cash and cash 4,568 4,071 3,939 equivalents Debt due within one year (550) (550) (550) Debt due after one year (865) (1,387) (1,132) Finance lease (1) (3) (2) Net funds 3,152 2,131 2,255 Notes to the interim financial statements for the six months ended 30 September 2008 1. Basis of preparation The interim financial statements have been prepared using consistent accounting policies as used in the preparation and filing of the statutory financial statements for the year ended 31 March 2008. They have been prepared under the historical cost convention and in accordance with applicable International Financial Reporting Standards (IFRS), International Accounting Standards (IAS) and International Financial Reporting Interpretations Committee (IFRIC) interpretations as adopted by the European Union (EU). The information within these interim financial statements is in compliance with IAS 34 "Interim Financial Reporting". 2. Audit review These interim financial statements do not constitute statutory financial statements within the meaning of the Companies Act 1985 and have not been subject to a review by our company auditors. 3. Segmental analysis Six months Six months Year ended ended ended 30 September 30 September 31 March 2008 2007 2008 Unaudited Unaudited Audited £ 000 £ 000 £ 000 Revenue Property information 3,901 5,221 10,615 services Financial services 209 225 449 Specialist electronics 1,448 608 2,035 Packaging solutions 650 718 1,368 6,208 6,772 14,467 Operating profit/(loss) Property information 775 1,556 3,075 services Financial services 114 117 273 Specialist electronics 469 (45) 273 Packaging solutions 110 221 387 Head office (330) (365) (798) Exceptional items 81 (34) (28) 1,219 1,450 3,182 Net Operating Assets Property information 1,298 788 1,548 services Financial services 54 (97) 47 Specialist electronics 705 700 970 Packaging solutions 365 115 398 Head Office 13,206 13,639 13,272 15,628 15,145 16,235 Interest bearing assets 4,568 4,071 3,939 Interest bearing liabilities (1,416) (1,940) (1,684) 18,780 17,276 18,490 4. Exceptional administrative credits/(expenses) Six months Six months Year ended ended ended 30 30 31 September September March 2008 2007 2008 Unaudited Unaudited Audited £ 000 £ 000 £ 000 Recovery of old debts 146 - - Abortive acquisition costs (65) - - (Loss) on disposal of financial - (34) (28) assets 81 (34) (28) 5. Earnings per share Basic earnings per share calculations have been arrived at by reference to the following profit and weighted average number of shares in issue during the period. The actual number of shares in issue at 30 September 2008 was 25,557,657. Six months Six months Year ended ended ended 30 30 31 March September September 2008 2007 2008 Profit after tax 885,000 1,055,000 2,432,000 Weighted average number of shares in 25,557,657 26,913,657 26,538,657 issue Basic earnings per share 3.46 p 3.92 p 9.16 p Weighted average number of shares in issue adjusted to take account of shares under 25,972,882 27,431,410 27,056,410 option Diluted earnings per share 3.41 p 3.84 p 8.99 p END The content and accuracy of news releases published on this site and/or distributed by PR Newswire or its partners are the sole responsibility of the originating company or organisation. Whilst every effort is made to ensure the accuracy of our services, such releases are not actively monitored or reviewed by PR Newswire or its partners and under no circumstances shall PR Newswire or its partners be liable for any loss or damage resulting from the use of such information. All information should be checked prior to publication.
Contact details for all releases are only available to the media via PR Newswire for Journalists.
|
PR Newswire Europe Ltd. 209 - 215 Blackfriars Road, London, SE1 8NL
|
Copyright © 2005 PR Newswire Europe Limited. All rights reserved. A United Business Media Company. Terms and conditions of use apply. |