TIDMPKW
RNS Number : 7238R
Parkwood Holdings PLC
27 August 2010
Parkwood Holdings plc
Interim Report
For the six months ended 30 June 2010
Financial Summary - continuing operations
+----------------------------------------------+--------------+----------------------+
| | (Unaudited) | Restated(Unaudited) |
| | 30 June 2010 | 30 June 2009 |
+----------------------------------------------+--------------+----------------------+
| | | |
+----------------------------------------------+--------------+----------------------+
| Revenue | GBP58.0m | GBP58.3m |
+----------------------------------------------+--------------+----------------------+
| | | |
+----------------------------------------------+--------------+----------------------+
| Adjusted operating profit/(loss) | GBP1.85m | (GBP0.18m) |
+----------------------------------------------+--------------+----------------------+
| | | |
+----------------------------------------------+--------------+----------------------+
| Operating profit/(loss) | GBP1.23m | (GBP0.68m) |
+----------------------------------------------+--------------+----------------------+
| | | |
+----------------------------------------------+--------------+----------------------+
| Profit/(loss) before taxation | GBP1.03m | (GBP0.87m) |
+----------------------------------------------+--------------+----------------------+
| | | |
+----------------------------------------------+--------------+----------------------+
| Basic earnings/(loss) per share | 3.9p | (6.0p) |
+----------------------------------------------+--------------+----------------------+
| | | |
+----------------------------------------------+--------------+----------------------+
| Interim dividend paid in the period | 1.2p | nil |
+----------------------------------------------+--------------+----------------------+
| | | |
+----------------------------------------------+--------------+----------------------+
| Order book | GBP518m | GBP500m |
+----------------------------------------------+--------------+----------------------+
| | | |
+----------------------------------------------+--------------+----------------------+
The adjusted operating profit/(loss) is stated before amortisation and
impairment charges. The 2009 comparatives have been restated to exclude the
results of discontinued operations and for a prior period adjustment detailed in
note 2.1.
Financial Calendar
Full year results announced
March 2011
Annual General Meeting
May 2011
This statement is available from the Company's website at
www.parkwood-holdings.co.uk. Shareholders will be notified in writing when the
Interim Report is available unless shareholders have specifically elected to
receive paper copies. Copies can be obtained from the registered office:
Parkwood House
Cuerden Park
Berkeley Drive
Bamber Bridge
Preston
PR5 6BY
Chairman's Statement
In the six month period to 30 June 2010, Parkwood has returned to profitability
after the losses of 2009. Parkwood Leisure goes from strength to strength and
the Group signed what will probably be its last leisure PFI contract with
Bristol City Council in April. Effective cash management has allowed Parkwood to
repay loans of GBP3.3 million and maintain a positive cash balance for most of
the period.
The change of government in May and the announcement of significant cuts to the
budgets of both central and local government provides both opportunity and risk
to Parkwood. The free swimming programme for those under 16 and over 60 has
been cancelled, and Glendale is being asked to forego RPI inflation uplifts on
its contracts. However, some local authorities are considering outsourcing
their services for the first time since the abolition of CCT (Compulsory
Competitive Tendering) and others are seeking to consult with the private sector
seeking innovative ideas to help reduce costs.
Group results
Revenues were maintained at GBP58.0 million (2009: GBP58.3 million restated),
although this masked a further rebalancing of the Group with a 7% increase in
revenues in Parkwood Leisure and a 5% reduction in Glendale's revenues.
Operating profits of GBP1.2 million were achieved (2009: operating loss restated
of GBP0.7 million). Average cash balances of GBP2.6 million have been
maintained throughout the period despite the fact that asset finance has not
been available and GBP0.8 million of capital expenditure has been cash funded.
The Group's forward order book at the period end was GBP518 million (2009:
GBP500 million).
Dividend
A dividend of 1.2p per share was paid on 1 April 2010 and the Board is pleased
to announce that a further dividend of 1.5p will be paid on 8 October 2010 to
all shareholders on the register on 17 September 2010.
The Company purchased for cancellation, 52,500 shares in the period, under its
share buyback authority.
Board and management
There have been no changes to the composition of the Board during the period.
Richard Tolkien became the senior independent non-executive director on 30 April
2010 and will serve as Chair of the Audit and Remuneration Committees. An
advertisement for a new non-executive director was placed in the Financial Times
in May and interviews are currently being conducted. The board will then
consist of three executive and three non-executive directors.
Leisure
Parkwood Leisure's revenues in the first half increased to GBP32.1 million
(2009: GBP29.9 million restated) with adjusted operating profits amounting to
GBP2.4 million (2009: GBP2.1 million restated). Health and Fitness memberships
under the Expressions brand totalled 52,900 at the period end (2009: 48,700),
providing GBP1.8 million of direct debit income per month at an average monthly
subscription of GBP34.
The company is bidding for a number of large contracts and in June was
successful in retaining the contract that it has held with Exeter City Council
for the Riverside Centre, augmented by an additional six facilities.
During May 2010, the Alemo Heron v Parkwood Leisure case was considered for
appeal in the Supreme Court. This important employment law case relates to the
nature of the contractual right of an employee to a previously negotiated pay
award at the point of transfer of their employment to a new employer. The Court
of Appeal has previously found in favour of Parkwood Leisure which could mean
that local government national pay awards need not be recognised by the private
sector. The trade union, Unison brought the appeal to the Supreme Court.
Parkwood Leisure is now recognised as one of the top three companies in the
local authority leisure market and is well positioned to win more new business
in the second half of the year.
Glendale
Glendale's revenues for the period declined to GBP24.6 million (2009: GBP25.9
million restated) with the loss of a number of contracts as a result of fierce
price competition. Losses have continued with an adjusted operating loss in the
period of GBP0.5 million compared to an adjusted operating loss of GBP0.9
million for the corresponding prior year period.
Glendale's core grounds maintenance and Countryside business is trading
profitably, but losses have continued to be incurred by the horticultural
nursery business known as Coblands, the recycling business in Devon, and
Glendale Golf. At Coblands, stock levels have been reduced to GBP0.9 million
but some horticultural stock has been traded at a loss. Overall plant sales in
the spring and early summer months have also been disappointing. A new general
manager appointed in August 2010 is reviewing the company's cost base. Glendale
Recycling's in-vessel composting (IVC) plant at Exeter is now fully operational,
but suffers from feedstock revenues lower than those in the original business
model, and the Plymouth based green waste composting facility has had to close
as a result of redevelopment. The company has, however, re-won its contract
with Plymouth City Council to process their green waste which is now being
transported to Exeter. Glendale Golf has not recovered its sales to previous
levels as a result of both the recession and poor weather, and despite careful
management continues to incur losses. Glendale has reduced its overhead base
and growth aspirations in order to meet the challenge of difficult times. A
return to overall profitability is the prime aim of Glendale's senior
management.
Healthcare
Parkwood Healthcare's revenue for the period was reduced to GBP1.1 million
(2009: GBP2.4 million) as a result of the company having virtually wound up its
activity in its loss making patient transport business. The 'healthy living
agenda' forms a major part of Healthcare's new strategy and two existing health
trainer contracts, which commenced at the end of 2009, have been added to with
the award of a new health trainer contract for Leicester PCT which will commence
in October.
The new Coalition Government's White Paper, Equity and Excellence; Liberating
the NHS, suggests that the Local Involvement Networks (LINks) will become the
local 'Health Watch', commissioned by local authorities to create a strong local
infrastructure for patients. 'Health Watch England' will be established as the
new independent consumer champion within the Care Quality Commission. Parkwood
Healthcare holds three LINk contracts in London and now expects to build on this
service.
The nursing agency business has suffered a fall in revenues in the period as
there has been less demand for agency work with people being more inclined to
stay in post. Overall adjusted operating losses in Parkwood Healthcare reduced
to GBP0.04 million from GBP0.3 million in the same period last year.
Parkwood Consultancy Services
Parkwood Consultancy Services (PCS) finally signed what will be its last leisure
PFI contract to build a GBP27 million leisure centre for Bristol City Council in
April. At the same time equity in the special purpose company (SPC), Bristol
Active Limited, was sold to Equitix, a specialist fund which will also provide
the subordinated debt for the project. Kier Western are to construct the
facility with PCS undertaking all project management. Parkwood Leisure will
operate the centre which is scheduled to open in January 2012. The centre's
facilities will include a 'healthy living' suite operated by Parkwood
Healthcare.
Revenues for the period as a result of this and other transactions amounted to
GBP1.0 million (2009: GBP0.8 million). Augmented by the sale of equity in
Bristol Active, adjusted operating profits of GBP0.9 million were recorded
(2009: loss of GBP0.1 million). Investment income was negligible with the sale
at the end of 2009 of most leisure SPCs. Realm Services (DAC) Limited was
placed in administration following a contractual dispute with the Ministry of
Defence in 2009 which finally resulted in the termination of the contract to run
the Defence Animal Centre in February this year.
The company now manages some GBP22 million of lifecycle funds for various SPCs
on which it takes the risk. PCS is also still actively engaged in project
management. A cemeteries and crematorium project with North Somerset District
Council which was scheduled for completion during the period is now expected to
close in September. Environmental consultancy services, in landscaping,
arboriculture and environmental management continue with PCS providing the
support for the Group's requirement to comply with the Carbon Reduction
Commitment Scheme.
Investment funding and strategy
Ongoing investment in machinery and leisure centre facilities requires funding
as usual and Parkwood intends to seek new asset finance in the autumn; lease
finance for vehicles having already become more available. The Group will seek
to renew its GBP2.5 million overdraft facility in December 2010, but is
expecting to be mainly cash positive for the year.
The focus on cash management over the last eighteen months and the sale of the
subordinated debt and equity in the leisure SPCs at the end of 2009 provides
Parkwood with security and reduced risk. Consolidation and stability are at the
heart of the Group's strategy for the immediate future.
A W Hewitt
Executive Chairman
27 August 2010
Financial Review
Trading performance
The results for the six months ended 30 June 2010 demonstrate an improvement in
the Group's performance. Whilst revenue remained broadly flat at GBP58.0
million, the Group reported a profit after tax of GBP0.7 million compared to a
loss of GBP0.9 million (restated) in the six months ended 30 June 2009.
EBITDA was GBP3.3 million (2009: GBP1.7 million restated). After non-cash
charges for depreciation, amortisation and impairments, an operating profit of
GBP1.2 million was recorded (2009: GBP0.7 million loss restated). Excluding
amortisation and impairments, the adjusted operating profit was GBP1.8 million
(2009: GBP0.2 million loss restated).
After net finance costs of GBP0.2 million, profit before tax was GBP1.0 million
(2009: GBP0.9 million loss restated).
Revenue and adjusted operating profit are analysed by division in the table
below.
Leisure continued its strong growth trend and increased its revenue by 7% to
GBP32.1 million. Adjusted operating profit grew by 17% to GBP2.4 million.
Glendale's revenue fell by 5% to GBP24.6 million but its adjusted operating loss
reduced by GBP0.4 million. The improvement in Glendale's loss was driven by a
strong performance in the core Grounds and Countryside businesses which saw
profits increase by GBP0.7 million. The Golf, Recycling and Horticulture
businesses reported
a combined adjusted operating loss of GBP1.2 million (2009: GBP0.9 million)
although progress has been made towards reducing the financial burden these
businesses place on the rest of the Group.
Parkwood Consultancy Services recorded an adjusted operating profit of GBP0.9
million which was mainly attributable to the successful closure of the Bristol
PFI contract in April.
Following the cessation of the loss making Staffordshire patient transport
contract, Healthcare's revenue has fallen by GBP1.3 million but its adjusted
operating loss has reduced by GBP0.2 million to almost breakeven.
Cash and borrowings
The improved trading performance enabled the Group to make an early repayment of
all its bank loans totalling GBP3.3 million in April. In addition, there was a
net reduction of GBP0.5 million in the Group's hire purchase obligations which
now stand at GBP3.8 million.
The average daily cash balance during the period was GBP2.6 million and the
Group's GBP2.5 million overdraft facility was only utilised for 7 days to a
maximum of GBP1.2 million.
At 30 June 2010, the Group held net positive cash balances of GBP0.6 million.
With no bank loans, reduced hire purchase borrowings and positive cash balances,
the Group is well placed to weather the challenging economic climate.
+---------------+---------+---------------+---------+---------------+---------+---------------+
| | (Unaudited) | Restated | Restated |
| | Six months to | (Unaudited) | (Unaudited) |
| | 30 June 2010 | Six months to | Year to 31 |
| | | 30 June 2009 | December 2009 |
+---------------+-------------------------+-------------------------+-------------------------+
| | | Adjusted | | Adjusted | | Adjusted |
| | | operating | | operating | | operating |
| | Revenue | profit/(loss) | Revenue | profit/(loss) | Revenue | profit/(loss) |
+---------------+---------+---------------+---------+---------------+---------+---------------+
| | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 |
+---------------+---------+---------------+---------+---------------+---------+---------------+
| | | | | | | |
+---------------+---------+---------------+---------+---------------+---------+---------------+
| Leisure | 32,088 | 2,401 | 29,891 | 2,054 | 61,425 | 4,225 |
+---------------+---------+---------------+---------+---------------+---------+---------------+
| Glendale | 24,610 | (515) | 25,919 | (944) | 51,117 | (1,339) |
+---------------+---------+---------------+---------+---------------+---------+---------------+
| Healthcare | 1,144 | (44) | 2,444 | (290) | 3,792 | (337) |
+---------------+---------+---------------+---------+---------------+---------+---------------+
| PCS | 1,017 | 895 | 752 | (113) | 1,317 | (286) |
+---------------+---------+---------------+---------+---------------+---------+---------------+
| Other | 686 | (888) | 1,163 | (891) | 1,760 | (2,024) |
+---------------+---------+---------------+---------+---------------+---------+---------------+
| Inter-segment | (1,511) | - | (1,846) | - | (3,451) | - |
| revenue | | | | | | |
+---------------+---------+---------------+---------+---------------+---------+---------------+
| | 58,034 | 1,849 | 58,323 | (184) | 115,960 | 239 |
+---------------+---------+---------------+---------+---------------+---------+---------------+
Accounting adjustments
Historically the Group has capitalised fixed assets which have been funded,
either directly or indirectly by local authorities.
IFRIC 12, 'Service Concession Arrangements', became effective during the period
and requires that such assets should not be capitalised. IFRIC 12 also requires
that the net cost of replacing assets during a service concession arrangement is
accrued for evenly over the life of the contract. The requirements of IFRIC 12
affect certain contracts operated by the Leisure division.
The Group's balance sheet as at 31 December 2009 has therefore been restated.
At this date, assets with a net book value of GBP2.2 million and a creditor of
GBP0.7 million, representing funding not yet amortised, have been derecognised
from the balance sheet through a prior period adjustment. In addition, an asset
of GBP1.1 million has been recognised representing future funding that will be
received. The net impact is a GBP0.3 million reduction to net assets.
Additionally, Glendale Liverpool Limited has been deconsolidated as explained in
note 2.2, there was no material impact to the financial statements.
Principal risks and uncertainties
The Group's Annual Report for the year ended 31 December 2009 set out the
principal risks and uncertainties affecting the Group and its separate
businesses. The Directors consider that these risks and uncertainties remained
current throughout the six months to 30 June 2010 and will remain so for the
second half of the year together with the announcement of significant cuts to
the budgets of both central and local government following the election in May
2010.
Mike Quayle
Group Finance Director
27 August 2010
+------------------------------------------+-+-------------+-------------+-------------+
| | | | Year |
| | | Six Months | ended |
| | | ended 30 | 31 |
| | | June | December |
+------------------------------------------+-+---------------------------+-------------+
| | | | Restated | Restated |
+------------------------------------------+-+-------------+-------------+-------------+
| | | (Unaudited) | (Unaudited) | (Unaudited) |
+------------------------------------------+-+-------------+-------------+-------------+
| | | 2010 | 2009 | 2009 |
+------------------------------------------+-+-------------+-------------+-------------+
| | | GBP000 | GBP000 | GBP000 |
+------------------------------------------+-+-------------+-------------+-------------+
| Continuing operations | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Revenue | | 58,034 | 58,323 | 115,960 |
+------------------------------------------+-+-------------+-------------+-------------+
| Cost of sales | | (38,779) | (40,049) | (79,059) |
+------------------------------------------+-+-------------+-------------+-------------+
| Gross profit | | 19,255 | 18,274 | 36,901 |
+------------------------------------------+-+-------------+-------------+-------------+
| Administration expenses | | (18,024) | (18,956) | (37,375) |
+------------------------------------------+-+-------------+-------------+-------------+
| Operating profit/(loss) | | 1,231 | (682) | (474) |
| | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| EBITDA | | 3,282 | 1,682 | 3,662 |
+------------------------------------------+-+-------------+-------------+-------------+
| Depreciation | | (1,433) | (1,866) | (3,423) |
+------------------------------------------+-+-------------+-------------+-------------+
| Operating profit/(loss) before | | 1,849 | (184) | 239 |
| amortisation and impairment | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Amortisation | | (31) | (37) | (62) |
+------------------------------------------+-+-------------+-------------+-------------+
| Impairment charges | | (587) | (461) | (651) |
+------------------------------------------+-+-------------+-------------+-------------+
| Operating profit/(loss) | | 1,231 | (682) | (474) |
+------------------------------------------+-+-------------+-------------+-------------+
| | | 36 | 152 | 193 |
| Finance income | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Finance costs | | (241) | (247) | (622) |
+------------------------------------------+-+-------------+-------------+-------------+
| Share of results of joint venture after | | - | (96) | (94) |
| taxation | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Profit/(loss) before taxation from | | 1,026 | (873) | (997) |
| continuing operations | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Income tax expense | | (326) | (200) | (72) |
+------------------------------------------+-+-------------+-------------+-------------+
| Profit/(loss) for the period from | | 700 | (1,073) | (1,069) |
| continuing operations | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Discontinued operations | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Gain on disposal of SPCs | | - | - | 5,620 |
+------------------------------------------+-+-------------+-------------+-------------+
| Loss on impairment of Realm | | - | - | (2,700) |
+------------------------------------------+-+-------------+-------------+-------------+
| Profit for the period from discontinued | | - | 223 | 176 |
| operations | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Total profit for the period from | | - | 223 | 3,096 |
| discontinued operations | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Profit/(loss) for the period | | 700 | (850) | 2,027 |
| attributable to equity shareholders | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Basic and diluted earnings/(loss) per | | Pence | Pence | Pence |
| share | | | | |
| | | per | per | per |
| | | share | share | share |
+------------------------------------------+-+-------------+-------------+-------------+
| From continuing operations | | 3.9 | (6.0) | (5.9) |
+------------------------------------------+-+-------------+-------------+-------------+
| From discontinued operations | | - | 1.2 | 17.2 |
+------------------------------------------+-+-------------+-------------+-------------+
| Total | | 3.9 | (4.8) | 11.3 |
+------------------------------------------+-+-------------+-------------+-------------+
+------------------------------------------+-+-------------+-------------+-------------+
| | | Six months | Year |
| | | ended 30 | ended |
| | | June | 31 |
| | | | December |
+------------------------------------------+-+---------------------------+-------------+
| | | | Restated | Restated |
| | | (Unaudited) | (Unaudited) | (Unaudited) |
| | | 2010 | 2009 | 2009 |
| | | GBP000 | GBP000 | GBP000 |
+------------------------------------------+-+-------------+-------------+-------------+
| Profit/(loss) for the period | | 700 | (850) | 2,027 |
| attributable to equity shareholders | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Other comprehensive income/(losses) | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Continuing operations | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Actuarial loss on defined benefit | | - | - | (1,933) |
| pension scheme | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Change in derivative valuations - cash | | 48 | 21 | 62 |
| flow hedges | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Income tax relating to components of | | (14) | (6) | 524 |
| other comprehensive income | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Discontinued operations | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Actuarial loss on defined benefit | | - | - | (200) |
| pension scheme | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Change in derivative valuations - cash | | - | 1,284 | 441 |
| flow hedges | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Income tax relating to components of | | - | (360) | (67) |
| other comprehensive income | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Reclassification adjustment - disposal | | - | - | 3,442 |
| of cash flow hedges | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Other comprehensive income for the | | 34 | 939 | 2,269 |
| period, net of tax | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
| Total comprehensive income for the | | 734 | 89 | 4,296 |
| period | | | | |
+------------------------------------------+-+-------------+-------------+-------------+
All recognised income and expense is attributable to the equity holders of the
parent company.
+-----------------------------------------------+--+-------------+-------------+
| | | | Restated |
+-----------------------------------------------+--+-------------+-------------+
| | | (Unaudited) | (Unaudited) |
+-----------------------------------------------+--+-------------+-------------+
| | | 30 | 31 |
| | | June | December |
| | | 2010 | 2009 |
+-----------------------------------------------+--+-------------+-------------+
| | | GBP000 | GBP000 |
+-----------------------------------------------+--+-------------+-------------+
| Non current assets | | | |
+-----------------------------------------------+--+-------------+-------------+
| Goodwill | | 1,444 | 1,868 |
+-----------------------------------------------+--+-------------+-------------+
| Intangible assets | | 154 | 185 |
+-----------------------------------------------+--+-------------+-------------+
| Property, plant and equipment | | 11,299 | 11,891 |
+-----------------------------------------------+--+-------------+-------------+
| Investments | | 441 | 447 |
+-----------------------------------------------+--+-------------+-------------+
| Trade and other receivables | | 1,963 | 1,244 |
+-----------------------------------------------+--+-------------+-------------+
| Deferred tax asset | | 1,293 | 1,375 |
+-----------------------------------------------+--+-------------+-------------+
| | | 16,594 | 17,010 |
+-----------------------------------------------+--+-------------+-------------+
| | | | |
+-----------------------------------------------+--+-------------+-------------+
| Current assets | | | |
+-----------------------------------------------+--+-------------+-------------+
| Inventories | | 2,334 | 2,878 |
+-----------------------------------------------+--+-------------+-------------+
| Trade and other receivables | | 12,529 | 13,236 |
+-----------------------------------------------+--+-------------+-------------+
| Cash and cash equivalents | | 618 | 4,904 |
+-----------------------------------------------+--+-------------+-------------+
| | | 15,481 | 21,018 |
+-----------------------------------------------+--+-------------+-------------+
| | | | |
+-----------------------------------------------+--+-------------+-------------+
| Total assets | | 32,075 | 38,028 |
+-----------------------------------------------+--+-------------+-------------+
| | | | |
+-----------------------------------------------+--+-------------+-------------+
| Current liabilities | | | |
+-----------------------------------------------+--+-------------+-------------+
| Trade and other payables | | 19,151 | 21,959 |
+-----------------------------------------------+--+-------------+-------------+
| Income tax payable | | 263 | 33 |
+-----------------------------------------------+--+-------------+-------------+
| Obligations under finance leases | | 1,231 | 1,503 |
+-----------------------------------------------+--+-------------+-------------+
| Borrowings | | - | 2,639 |
+-----------------------------------------------+--+-------------+-------------+
| | | 20,645 | 26,134 |
+-----------------------------------------------+--+-------------+-------------+
| | | | |
+-----------------------------------------------+--+-------------+-------------+
| Non current liabilities | | | |
+-----------------------------------------------+--+-------------+-------------+
| Borrowings | | - | 705 |
+-----------------------------------------------+--+-------------+-------------+
| Retirement benefit obligations | | 2,323 | 2,440 |
+-----------------------------------------------+--+-------------+-------------+
| Long term provisions | | 371 | 293 |
+-----------------------------------------------+--+-------------+-------------+
| Obligations under finance leases | | 2,569 | 2,771 |
+-----------------------------------------------+--+-------------+-------------+
| Derivative financial instruments | | - | 48 |
+-----------------------------------------------+--+-------------+-------------+
| Deferred tax liability | | 49 | 26 |
+-----------------------------------------------+--+-------------+-------------+
| | | 5,312 | 6,283 |
+-----------------------------------------------+--+-------------+-------------+
| | | | |
+-----------------------------------------------+--+-------------+-------------+
| Total liabilities | | 25,957 | 32,417 |
+-----------------------------------------------+--+-------------+-------------+
| | | | |
+-----------------------------------------------+--+-------------+-------------+
| Net assets | | 6,118 | 5,611 |
+-----------------------------------------------+--+-------------+-------------+
| | | | |
+-----------------------------------------------+--+-------------+-------------+
| | | | |
+-----------------------------------------------+--+-------------+-------------+
| Equity | | | |
+-----------------------------------------------+--+-------------+-------------+
| Share capital | | 186 | 187 |
+-----------------------------------------------+--+-------------+-------------+
| Share premium account | | 2,227 | 2,227 |
+-----------------------------------------------+--+-------------+-------------+
| Investment in own shares | | (417) | (417) |
+-----------------------------------------------+--+-------------+-------------+
| Capital redemption reserve | | 411 | 410 |
+-----------------------------------------------+--+-------------+-------------+
| Hedging reserve | | - | (34) |
+-----------------------------------------------+--+-------------+-------------+
| Retained earnings | | 3,711 | 3,238 |
+-----------------------------------------------+--+-------------+-------------+
| Equity attributable to the equity holders of | | 6,118 | 5,611 |
| the parent | | | |
+-----------------------------------------------+--+-------------+-------------+
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| | Share | Share | Investment | Capital | Hedging | Reval | Retained | Total |
| | capital | premium | in own | redemption | reserve | -uation | earnings | |
| | | | shares | reserve | | reserve | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Balance at 1 | 187 | 2,227 | (417) | 410 | (34) | - | 3,532 | 5,905 |
| January 2010 | | | | | | | | |
| as originally | | | | | | | | |
| reported | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Prior period | - | - | - | - | - | - | (294) | (294) |
| adjustments | | | | | | | | |
| (note 2.1) | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Balance at 1 | 187 | 2,227 | (417) | 410 | (34) | - | 3,238 | 5,611 |
| January 2010 | | | | | | | | |
| as restated | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Profit for the | - | - | - | - | - | - | 700 | 700 |
| period | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Other | | | | | | | | |
| comprehensive | | | | | | | | |
| income: | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Changes in | - | - | - | - | 48 | - | - | 48 |
| derivative | | | | | | | | |
| valuations - | | | | | | | | |
| Cash flow | | | | | | | | |
| hedges | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Income tax | - | - | - | - | (14) | - | - | (14) |
| relating to | | | | | | | | |
| components of | | | | | | | | |
| other | | | | | | | | |
| comprehensive | | | | | | | | |
| income | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Total | - | - | - | - | 34 | - | 700 | 734 |
| comprehensive | | | | | | | | |
| income for the | | | | | | | | |
| period | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Purchase of | - | - | (18) | - | - | - | - | (18) |
| treasury | | | | | | | | |
| shares (note | | | | | | | | |
| 10) | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Cancellation | (1) | - | 18 | 1 | - | - | (18) | - |
| of treasury | | | | | | | | |
| shares (note | | | | | | | | |
| 10) | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Share based | - | - | - | - | - | - | 7 | 7 |
| payments | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Dividends | - | - | - | - | - | - | (216) | (216) |
| (note 5) | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Balance at 30 | 186 | 2,227 | (417) | 411 | - | - | 3,711 | 6,118 |
| June 2010 | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Balance at 1 | 189 | 2,227 | (729) | 408 | 443 | 819 | 2,688 | 6,045 |
| January 2009 | | | | | | | | |
| as originally | | | | | | | | |
| reported | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Prior period | - | - | - | - | (4,282) | - | (429) | (4,711) |
| adjustments | | | | | | | | |
| (note 2.1) | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Balance at 1 | 189 | 2,227 | (729) | 408 | (3,839) | 819 | 2,259 | 1,334 |
| January 2009 | | | | | | | | |
| as restated | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Loss for the | - | - | - | - | - | - | (850) | (850) |
| period | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Other | | | | | | | | |
| comprehensive | | | | | | | | |
| income: | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Changes in | - | - | - | - | 21 | - | - | 21 |
| derivative | | | | | | | | |
| valuations - | | | | | | | | |
| Cash flow | | | | | | | | |
| hedges | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Changes in | - | - | - | - | 1,284 | - | - | 1,284 |
| derivative | | | | | | | | |
| valuations - | | | | | | | | |
| Cash flow | | | | | | | | |
| hedges | | | | | | | | |
| (discontinued) | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Income tax | - | - | - | - | (6) | - | - | (6) |
| relating to | | | | | | | | |
| components of | | | | | | | | |
| other | | | | | | | | |
| comprehensive | | | | | | | | |
| income | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Income tax | - | - | - | - | (360) | - | - | (360) |
| relating to | | | | | | | | |
| components of | | | | | | | | |
| other | | | | | | | | |
| comprehensive | | | | | | | | |
| income | | | | | | | | |
| (discontinued) | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Total | - | - | - | - | 939 | - | (850) | 89 |
| comprehensive | | | | | | | | |
| income for the | | | | | | | | |
| period | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Cancellation | (2) | - | 253 | 2 | - | - | (253) | - |
| of treasury | | | | | | | | |
| shares | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Transfer to | - | - | - | - | - | (36) | 36 | - |
| retained | | | | | | | | |
| earnings | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| Balance at 30 | 187 | 2,227 | (476) | 410 | (2,900) | 783 | 1,192 | 1,423 |
| June 2009 | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
| | | | | | | | | |
+----------------+---------+---------+------------+------------+---------+---------+----------+---------+
+-------------------------------------------+-+-------------+-------------+-------------+
| | | | Restated | Restated |
| | | Six | | Year |
| | | months | Six | ended |
| | | ended | months | 31 |
| | | 30 | ended | December |
| | | June | 30 June | 2009 |
| | | 2010 | 2009 | |
+-------------------------------------------+-+-------------+-------------+-------------+
| | | (Unaudited) | (Unaudited) | (Unaudited) |
+-------------------------------------------+-+-------------+-------------+-------------+
| | | GBP000 | GBP000 | GBP000 |
+-------------------------------------------+-+-------------+-------------+-------------+
| Net cash flow from operating activities | | 1,017 | 2,059 | 8,575 |
+-------------------------------------------+-+-------------+-------------+-------------+
| | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Cash flow from investing activities | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Interest received | | 36 | 138 | 195 |
+-------------------------------------------+-+-------------+-------------+-------------+
| Proceeds on disposal of property, plant | | 243 | 26 | 108 |
| and equipment | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Purchase of property, plant and equipment | | (804) | (557) | (910) |
+-------------------------------------------+-+-------------+-------------+-------------+
| Lifecycle and client funded capital | | (316) | (136) | (404) |
| expenditure | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Lifecycle and client funding received for | | 235 | 199 | 609 |
| capital expenditure | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Subordinated debt repaid | | 6 | 8 | 9 |
+-------------------------------------------+-+-------------+-------------+-------------+
| Net proceeds from sale of SPCs | | - | - | 4,154 |
+-------------------------------------------+-+-------------+-------------+-------------+
| Cash disposed of on sale of SPCs | | - | - | (2,230) |
+-------------------------------------------+-+-------------+-------------+-------------+
| Cash eliminated on Realm deconsolidation | | - | - | (818) |
+-------------------------------------------+-+-------------+-------------+-------------+
| Acquisition of subsidiary (net of cash | | - | - | (104) |
| acquired) | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Purchase of investment | | - | - | (393) |
+-------------------------------------------+-+-------------+-------------+-------------+
| Cash flows used in investing activities | | - | (58) | (165) |
| (discontinued) | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Net cash (used in)/generated by investing | | (600) | (380) | 51 |
| activities | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Cash flow from financing activities | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Interest paid | | (95) | (259) | (641) |
+-------------------------------------------+-+-------------+-------------+-------------+
| Dividends paid | | (216) | - | - |
+-------------------------------------------+-+-------------+-------------+-------------+
| Acquisition of treasury shares | | (18) | - | - |
+-------------------------------------------+-+-------------+-------------+-------------+
| Repayment of obligations under finance | | (1,030) | (813) | (1,753) |
| leases | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Repayment of bank loans | | (3,344) | (473) | (1,115) |
+-------------------------------------------+-+-------------+-------------+-------------+
| Cash flows from financing activities | | - | (1,286) | (2,561) |
| (discontinued) | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Net cash used in financing activities | | (4,703) | (2,831) | (6,070) |
+-------------------------------------------+-+-------------+-------------+-------------+
| | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Net (decrease)/increase in cash and cash | | (4,286) | (1,152) | 2,556 |
| equivalents | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Cash and cash equivalents at beginning of | | 4,904 | 2,348 | 2,348 |
| the period | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Cash and cash equivalents at the end of | | 618 | 1,196 | 4,904 |
| the period | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Comprising: | | | | |
+-------------------------------------------+-+-------------+-------------+-------------+
| Cash - continuing | | 618 | 1,821 | 5,604 |
+-------------------------------------------+-+-------------+-------------+-------------+
| Overdraft - discontinued | | - | (625) | (700) |
+-------------------------------------------+-+-------------+-------------+-------------+
| | | 618 | 1,196 | 4,904 |
+-------------------------------------------+-+-------------+-------------+-------------+
1. General information
Parkwood Holdings plc and its subsidiaries' (together the Group) principal
activities include leisure management, grounds management, arboriculture,
horticulture, green waste recycling, healthcare provision and consultancy
services. Parkwood Holdings plc is a public limited company incorporated and
domiciled in the United Kingdom. The address of Parkwood Holdings plc's
registered office is Parkwood House, Cuerden Park, Berkeley Drive, Bamber
Bridge, Preston, PR5 6BY.
The financial information for the year ended 31 December 2009 set out in this
interim report does not constitute statutory accounts as defined by Section 434
of the Companies Act 2006. The Group's statutory financial statements for the
year ended 31 December 2009 have been filed with the Registrar of Companies.
The financial information in respect of the year ended 31 December 2009 has been
produced using extracts from the audited statutory accounts prepared under IFRSs
for this period as restated for the prior period adjustments described in note
2.1 which are unaudited. The auditors' report on the Consolidated Financial
Statements for the year ended 31 December 2009 was unqualified and did not
contain statements under section 498 (2), (3) or (4) of the Companies Act 2006.
2. Accounting policies and basis of preparation
The condensed unaudited interim consolidated financial statements were approved
by the Board on 27 August 2010 and have not been audited by the Group's auditors
or reviewed in accordance with Bullitins issued by the APB. This consolidated
interim financial information for the six months ended 30 June 2010 has been
prepared in accordance with IAS 34, 'Interim financial reporting'. It does not
include all of the information required in annual financial statements in
accordance with IFRSs and should be read in conjunction with the consolidated
financial statements for the year ended 31 December 2009.
Taxes on income in the interim periods are accrued using the tax rate that would
be applicable to expected total annual earnings.
These condensed interim consolidated financial statements have been prepared in
accordance with the accounting policies adopted in the last annual financial
statements for the year to 31 December 2009 except for the adoption in the
period of IFRIC 12 'Service Concession Arrangements'. Significant effects on
the current period and prior periods arising from the first-time adoption of
this new interpretation are described below.
Other amendments and interpretations which are also effective for the first time
in the current period but have had no impact on the reported results or
financial position of the Group are:
- IFRS 3 'Business Combinations' (revised 2008);
- IAS 27 'Consolidated and separate financial statements' (revised 2008); and
- 'Improvements to IFRS 2009'.
The Group's overdraft facility expires in December 2010 and is expected to be
renewed on similar terms. After making reasonable enquiries and reviewing cash
flow forecasts, the directors have a reasonable expectation that the Group will
have adequate resources to continue in operational existence for the foreseeable
future. Accordingly they continue to adopt the going concern basis in preparing
the interim financial statements. The accounting policies have been applied
consistently throughout the Group for the purposes of preparation of these
interim consolidated financial statements.
2.1. Prior period adjustments
In addition to the prior period adjustments recognised in the financial
statements for the year ended 31 December 2009, the Group has recognised further
prior period adjustments as noted below.
2.1.1. IFRIC 12 'Service concession arrangements'
IFRIC 12 requires assets which are purchased by an operator of a service
concession arrangement for use by the public in return for a fee from a public
body or for the right to charge the public to use the assets, to be derecognised
from property, plant and equipment if the public body to some extent:
- controls or regulates what services the operator must provide with those
assets, to whom it must provide them and at what price; and
2. Accounting policies and basis of preparation (continued)
- controls through ownership, beneficial entitlement or otherwise any
significant residual interest in the asset at the end of the arrangement.
Instead, the cost of purchasing assets during the contract is accrued for evenly
over the life of the
contract in accordance with IAS 37 'Provisions contingent liabilities and
contingent assets'. If spend on assets is higher than the cumulative provision,
a financial asset is held on the balance sheet, being the spend in excess of the
cumulative provision.
Provisions are assessed on a contract by contract basis using management's
judgement of the expected future spend as at the balance sheet date.
As a result, assets with a net book value of GBP2.2 million have been
derecognised from the Group's balance sheet, a creditor representing lifecycle
income received to date of GBP0.7 million has been derecognised and a financial
asset of GBP1.1 million has been recognised as at 31 December 2009. Under the
Group's previous revenue recognition policy, monies received for lifecycle spend
on assets were not recognised as revenue. Under the new policy, monies received
are recognised as revenue and a corresponding amount is recognised as an
expense, resulting in a nil impact on gross profit.
The following summarises the impact on the Group's results in prior periods:
+------------------------------------------------+-------------+-------------+
| | Six | Year |
| | months | ended |
| | ended | 31 |
| | 30 June | December |
| | | (Unaudited) |
| | (Unaudited) | |
| | 2009 | 2009 |
+------------------------------------------------+-------------+-------------+
| | GBP000 | GBP000 |
+------------------------------------------------+-------------+-------------+
| Revenue | 136 | 404 |
+------------------------------------------------+-------------+-------------+
| Cost of sales - depreciation | 77 | 132 |
+------------------------------------------------+-------------+-------------+
| Cost of sales - other | (404) | (949) |
+------------------------------------------------+-------------+-------------+
| Administration expenses - depreciation | 155 | 364 |
+------------------------------------------------+-------------+-------------+
| Administration expenses - other | (6) | (16) |
+------------------------------------------------+-------------+-------------+
| Profit before taxation | (42) | (65) |
+------------------------------------------------+-------------+-------------+
| Taxation | 12 | 18 |
+------------------------------------------------+-------------+-------------+
| Profit after taxation | (30) | (47) |
+------------------------------------------------+-------------+-------------+
In addition to the prior period adjustment reported in 2009, net assets as at 31
December 2008 have been reduced by GBP243,000 as a result of the adoption of the
new policy. In the current period a depreciation charge of GBP251,000 would
have been recognised in the income statement relating to assets which have been
derecognised as a result of adopting IFRIC 12. Additional revenue of GBP312,000
has been recognised in the six months to 30 June 2010 under the new accounting
policy, representing income received for spend on lifecycle, a corresponding
expense has been recognised in cost of sales of GBP312,000. A charge of
GBP296,000 has been recognised to provide for the expense relevant to the period
for the estimated future spend on council owned assets. The net effect on
income in the six months to June 2010 is a reduction in profit before tax for
continuing operations of GBP45,000.
2.1.2. Glendale Liverpool Limited
Glendale Liverpool Limited is a joint venture company set up to operate a
grounds management contract in Liverpool. After review, it has been concluded
that the Group does not have control as defined by IAS 17 'Consolidated and
separate financial statements' and accordingly Glendale Liverpool Limited should
not be consolidated in the Group financial statements. The impact of
deconsolidating Glendale Liverpool Limited is to reduce revenue in the six
months to 30 June 2009 by GBP1.1 million and in the year ended 31 December 2009
by GBP2.4 million. There is no impact on profit and no material impact on the
statement of financial position as a result of this restatement.
3. Business segments
During the six month period to 30 June 2010 there have been no changes from
prior periods in the measurement methods used to determine operating segments
and reported segment profit or loss. Adjusted operating profit is operating
profit prior to amortisation and impairment charges.
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| (Unaudited) | Total | Inter-company | External | Adjusted | Depreciation | Gross | Net |
| | revenue | revenue | revenue | operating | | assets | assets/ |
| | | | | profit/(loss) | | | (liabilities) |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Six months ended | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 |
| 30 June 2010 | | | | | | | |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Leisure | 32,088 | 592 | 31,496 | 2,401 | 202 | 13,983 | 8,001 |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Glendale core | 20,994 | 209 | 20,785 | 638 | 835 | 12,861 | 187 |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Golf | 1,706 | - | 1,706 | (320) | 125 | 2,645 | (796) |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Recycling | 324 | 55 | 269 | (423) | 148 | 1,929 | (53) |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Horticulture | 1,586 | 297 | 1,289 | (410) | 58 | 1,701 | (1,503) |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Healthcare | 1,144 | - | 1,144 | (44) | 9 | (1,113) | (1,023) |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| PCS | 1,017 | 244 | 773 | 895 | 9 | 1,722 | 1,209 |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| All other | 686 | 114 | 572 | (888) | 47 | (1,653) | 96 |
| segments | | | | | | | |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Total group | 59,545 | 1,511 | 58,034 | 1,849 | 1,433 | 32,075 | 6,118 |
| (continuing) | | | | | | | |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| (Unaudited) | Total | Inter-company | External | Adjusted | Depreciation | Gross | Net |
| Six months ended | revenue | revenue | revenue | operating | | assets | assets/ |
| 30 June 2009 | | | | profit/(loss) | | | (liabilities) |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| (restated) | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Leisure | 29,891 | 1,290 | 28,601 | 2,054 | 229 | 14,794 | 5,850 |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Glendale core | 21,547 | 80 | 21,467 | (33) | 1,234 | 10,512 | 1,998 |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Golf | 2,132 | - | 2,132 | (276) | 153 | 3,381 | (376) |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Recycling | 491 | - | 491 | (529) | 63 | 1,007 | 525 |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Horticulture | 1,749 | - | 1,749 | (106) | 44 | 3,525 | (451) |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Healthcare | 2,444 | - | 2,444 | (290) | 70 | (699) | (994) |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| PCS | 752 | 476 | 276 | (113) | 12 | 8,671 | 2,143 |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| All other | 1,163 | - | 1,163 | (891) | 61 | (2,084) | (7,272) |
| segments | | | | | | | |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Total group | 60,169 | 1,846 | 58,323 | (184) | 1,866 | 39,107 | 1,423 |
| (continuing) | | | | | | | |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| (Unaudited) | Total | Inter-company | External | Adjusted | Depreciation | Gross | Net |
| Year ended 31 | revenue | revenue | revenue | operating | | assets | assets/ |
| December 2009 | | | | profit/(loss) | | | (liabilities) |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| (restated) | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Leisure | 61,425 | 2,038 | 59,387 | 4,225 | 426 | 13,997 | 5,931 |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Glendale core | 43,024 | 189 | 42,835 | 938 | 2,120 | 13,337 | 644 |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Golf | 4,259 | - | 4,259 | (381) | 352 | 2,780 | (562) |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Recycling | 830 | 20 | 810 | (632) | 127 | 2,773 | 415 |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Horticulture | 3,004 | 326 | 2,678 | (1,264) | 140 | 2,021 | (1,091) |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Healthcare | 3,792 | - | 3,792 | (337) | 108 | (1,185) | (964) |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| PCS | 1,317 | 766 | 551 | (286) | 23 | 1,506 | 380 |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| All other | 1,760 | 112 | 1,648 | (2,024) | 127 | 2,799 | 858 |
| segments | | | | | | | |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
| Total group | 119,411 | 3,451 | 115,960 | 239 | 3,423 | 38,028 | 5,611 |
| (continuing) | | | | | | | |
+-------------------+----------+---------------+----------+---------------+--------------+---------+---------------+
The above disclosures are derived directly from the income statement and
statement of financial position and as a result no reconciliation has been
provided.
4. Tax
A tax charge based on the anticipated annual rate for the period of GBP0.3
million (2009: GBP0.2 million) has been provided for in the interim period to 30
June 2010.
5. Dividends
An interim dividend of 1.2 pence per ordinary share was paid in respect of the
year end 31 December 2009 on 1 April 2010. The total amount paid and charged to
equity was GBP0.2 million. No dividends were paid or charged to equity during
2009.
6. Earnings/(loss) per share
Earnings/(loss) per share relate to continuing operations and have been
calculated on earnings/(losses) for the period divided by the weighted average
number of ordinary shares in issue of 17.99 million (December 2009: 18.03
million; June 2009 18.03 million). The share options in issue at 30 June 2010
are not dilutive as the option prices are all greater than the average share
price for the six months to 30 June 2010 and therefore the basic earnings per
share is not affected by share options outstanding.
7. Discontinued operations
The results of Glendale Facilities Management Limited are reported as a
discontinued operation. In prior periods the results below also include those
from the SPCs disposed of in December 2009 and Realm.
+-------------------------------------------+-------------+-------------+-------------+
| | Restated | Year |
| | | ended |
+-------------------------------------------+---------------------------+-------------+
| | Six months | 31 |
| | ended 30 June | December |
| | | 2009 |
| | | (Unaudited) |
+-------------------------------------------+---------------------------+ +
| | 2010 | | 2009 |
| | (Unaudited) | | (Unaudited) |
+-------------------------------------------+-------------+-------------+-------------+
| | GBP000 | GBP000 | GBP000 |
+-------------------------------------------+-------------+-------------+-------------+
| Profit for the year from discontinued | | | |
| operations | | | |
+-------------------------------------------+-------------+-------------+-------------+
| Revenue | - | 3,488 | 6,617 |
+-------------------------------------------+-------------+-------------+-------------+
| Expenses | - | (3,307) | (6,555) |
+-------------------------------------------+-------------+-------------+-------------+
| Share of results of joint ventures after | - | (19) | 68 |
| taxation | | | |
+-------------------------------------------+-------------+-------------+-------------+
| Profit before tax | - | 162 | 130 |
+-------------------------------------------+-------------+-------------+-------------+
| Taxation | - | 61 | 46 |
+-------------------------------------------+-------------+-------------+-------------+
| Profit after taxation for the period from | - | 223 | 176 |
| discontinued operations | | | |
+-------------------------------------------+-------------+-------------+-------------+
+-------------------------------------------+-------------+-------------+-------------+
| | Restated | Year |
| | | ended |
+-------------------------------------------+---------------------------+-------------+
| | Six months | 31 |
| | ended 30 June | December |
| | | 2009 |
| | | (Unaudited) |
+-------------------------------------------+---------------------------+ +
| | 2010 | | 2009 |
| | (Unaudited) | | (Unaudited) |
+-------------------------------------------+-------------+-------------+-------------+
| | GBP000 | GBP000 | GBP000 |
+-------------------------------------------+-------------+-------------+-------------+
| Cash flows from discontinued operations | | | |
+-------------------------------------------+-------------+-------------+-------------+
| Net cash flows from operating activities | - | 1,162 | 3,126 |
+-------------------------------------------+-------------+-------------+-------------+
| Net cash flows from investing activities | - | (58) | (165) |
+-------------------------------------------+-------------+-------------+-------------+
| Net cash flows from financing activities | - | (1,286) | (2,561) |
+-------------------------------------------+-------------+-------------+-------------+
| Net cash flows from discontinued | - | (182) | 400 |
| operations | | | |
+-------------------------------------------+-------------+-------------+-------------+
The results of discontinued operations for the six months ended 30 June 2010 are
not material and have not been disclosed separately.
8. Property, plant and equipment
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| (Unaudited) | Land | Assets | Vehicles | Plant | Fixtures | Total |
| | and | under | | and | and | |
| | buildings | construction | | equipment | fittings | |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Six months ended 30 June | | | | | | |
| 2010 | | | | | | |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Opening net book amount | 3,854 | 2,027 | 460 | 4,200 | 3,541 | 14,082 |
| at 1 January 2010 as | | | | | | |
| previously reported | | | | | | |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Prior period adjustment | - | - | (10) | (1,638) | (543) | (2,191) |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Opening net book amount | 3,854 | 2,027 | 450 | 2,562 | 2,998 | 11,891 |
| at 1 January 2010 | | | | | | |
| restated | | | | | | |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Additions | 56 | 42 | 201 | 701 | 110 | 1,110 |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Reclassifications | 1,767 | (1,767) | (2) | (1) | 3 | - |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Disposals | - | - | (2) | (21) | (84) | (107) |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Depreciation | (225) | - | (148) | (823) | (237) | (1,433) |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Impairments | (160) | - | - | - | (2) | (162) |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Closing net book amount | 5,292 | 302 | 499 | 2,418 | 2,788 | 11,299 |
| at 30 June 2010 | | | | | | |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| | | | | | | |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Year ended 31 December | | | | | | |
| 2009 | | | | | | |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Opening net book amount | 13,546 | 597 | 719 | 4,758 | 2,320 | 21,940 |
| at 1 January 2009 as | | | | | | |
| previously reported | | | | | | |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Prior period adjustment | - | - | - | (1,757) | (498) | (2,255) |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Opening net book amount | 13,546 | 597 | 719 | 3,001 | 1,822 | 19,685 |
| at 1 January 2009 | | | | | | |
| restated | | | | | | |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Additions | 70 | 79 | 125 | 1,328 | 192 | 1,794 |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Acquired with | - | 1,733 | - | - | - | 1,733 |
| subsidiaries | | | | | | |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Reclassifications | 315 | (326) | - | (8) | 19 | - |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Disposals | - | (56) | (62) | (21) | (9) | (148) |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Depreciation | (577) | - | (332) | (1,737) | (777) | (3,423) |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Impairments | (190) | - | - | - | - | (190) |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Discontinued operations | (9,310) | - | - | (1) | 1,751 | (7,560) |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| Closing net book amount | 3,854 | 2,027 | 450 | 2,562 | 2,998 | 11,891 |
| at 31 December 2009 | | | | | | |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
| | | | | | | |
+---------------------------+-----------+--------------+----------+-----------+----------+---------+
9. Net cash from operating activities
+------------------------------------------+-------------+-------------+-------------+
| | | Restated | Restated |
| | Six | | |
| | months | Six | Year |
| | ended | months | ended |
| | 30 | ended | 31 |
| | June | 30 June | December |
| | 2010 | 2009 | 2009 |
+------------------------------------------+-------------+-------------+-------------+
| | (Unaudited) | (Unaudited) | (Unaudited) |
+------------------------------------------+-------------+-------------+-------------+
| | GBP000 | GBP000 | GBP000 |
+------------------------------------------+-------------+-------------+-------------+
| Continuing operations | | | |
+------------------------------------------+-------------+-------------+-------------+
| Operating profit/(loss) | 1,231 | (682) | (474) |
+------------------------------------------+-------------+-------------+-------------+
| | | | |
+------------------------------------------+-------------+-------------+-------------+
| Depreciation of property, plant and | 1,433 | 1,866 | 3,423 |
| equipment | | | |
+------------------------------------------+-------------+-------------+-------------+
| (Profit)/loss on sale of property, plant | (112) | 4 | 77 |
| and equipment | | | |
+------------------------------------------+-------------+-------------+-------------+
| Impairment of goodwill and assets | 587 | 461 | 651 |
+------------------------------------------+-------------+-------------+-------------+
| Amortisation of intangible assets | 31 | 37 | 62 |
+------------------------------------------+-------------+-------------+-------------+
| Costs charged/(credited) in respect of | 7 | 14 | (8) |
| share remuneration | | | |
+------------------------------------------+-------------+-------------+-------------+
| Increase in provisions | 115 | 250 | 87 |
+------------------------------------------+-------------+-------------+-------------+
| Operating cash flows before movements in | 3,292 | 1,950 | 3,818 |
| working capital | | | |
+------------------------------------------+-------------+-------------+-------------+
| | | | |
+------------------------------------------+-------------+-------------+-------------+
| Decrease in inventories | 544 | 152 | 866 |
+------------------------------------------+-------------+-------------+-------------+
| (Increase)/decrease in receivables | (2,214) | (696) | 4,095 |
+------------------------------------------+-------------+-------------+-------------+
| Decrease in payables | (626) | (252) | (3,248) |
+------------------------------------------+-------------+-------------+-------------+
| Cash generated by operations | 996 | 1,154 | 5,531 |
+------------------------------------------+-------------+-------------+-------------+
| Income taxes refunded/(paid) | 21 | (257) | (82) |
+------------------------------------------+-------------+-------------+-------------+
| Net cash generated from operating | 1,017 | 897 | 5,449 |
| activities | | | |
+------------------------------------------+-------------+-------------+-------------+
| | | | |
+------------------------------------------+-------------+-------------+-------------+
| | | | |
+------------------------------------------+-------------+-------------+-------------+
| Discontinued operations | | | |
+------------------------------------------+-------------+-------------+-------------+
| Operating profit | - | 1,122 | 2,479 |
+------------------------------------------+-------------+-------------+-------------+
| | | | |
+------------------------------------------+-------------+-------------+-------------+
| Depreciation of property, plant and | - | 320 | 424 |
| equipment | | | |
+------------------------------------------+-------------+-------------+-------------+
| Loss on sale of property, plant and | - | - | 109 |
| equipment | | | |
+------------------------------------------+-------------+-------------+-------------+
| Impairment of assets | - | - | 60 |
+------------------------------------------+-------------+-------------+-------------+
| Amortisation of intangible assets | - | 206 | 241 |
+------------------------------------------+-------------+-------------+-------------+
| Decrease in provisions | - | (46) | (30) |
+------------------------------------------+-------------+-------------+-------------+
| Operating cash flows before movements in | - | 1,602 | 3,283 |
| working capital | | | |
+------------------------------------------+-------------+-------------+-------------+
| | | | |
+------------------------------------------+-------------+-------------+-------------+
| (Increase)/decrease in inventories | - | (150) | 6 |
+------------------------------------------+-------------+-------------+-------------+
| Increase in receivables | - | (539) | (1,693) |
+------------------------------------------+-------------+-------------+-------------+
| Increase in payables | - | 249 | 166 |
+------------------------------------------+-------------+-------------+-------------+
| Cash generated from operating activities | - | 1,162 | 1,762 |
+------------------------------------------+-------------+-------------+-------------+
| Income taxes refunded | | - | 1,364 |
+------------------------------------------+-------------+-------------+-------------+
| Net cash generated from operating | - | 1,162 | 3,126 |
| activities | | | |
+------------------------------------------+-------------+-------------+-------------+
| | | | |
+------------------------------------------+-------------+-------------+-------------+
| Total cash generated from operations | 1,017 | 2,059 | 8,575 |
+------------------------------------------+-------------+-------------+-------------+
The results of discontinued operations for the 6 months ended 30 June 2010 are
not material and have not been disclosed separately.
10. Investment in own shares
On 8 January 2010, the Company purchased 50,000 ordinary 1p shares to hold in
treasury at a price of 33p per share. On 28 January 2010, the Company cancelled
50,000 treasury shares leaving no shares held in treasury. On 22 June 2010, the
Company purchased a further 2,500 ordinary 1p shares at a price of 36.75p for
cancellation leaving no shares held in treasury at 30 June 2010. No further
acquisitions or cancellations have been made by the Company since 30 June 2010.
11. Related parties
Transactions between the Company and its subsidiaries, which are related
parties, have been eliminated on consolidation and are not disclosed in this
note.
There has been no change to the nature of the related party transactions in the
first six months of the financial year that has materially affected the
financial position or performance of the Group.
Cautionary Statement
This interim management report has been prepared solely to provide additional
information to shareholders to assess the Group's strategies and the potential
for those strategies to succeed. The interim management report should not be
relied on by any other party or for any other purpose.
Responsibility Statement
We confirm that to the best of our knowledge:
· The condensed set of financial statements, which has been prepared in
accordance with the applicable set of accounting standards, give a true and fair
view of assets, liabilities, financial position and the undertakings included in
the consolidation as a whole;
· The interim management report includes a fair review of the information
required by DTR 4.2.7R (indication of important events during the first six
months and description of principle risks and uncertainties for the remaining
six months of the year); and
· The interim management report includes a fair review of the information
required by DTR 4.2.8R (disclosure of related parties' transactions and changes
therein).
By order of the board
C Stockdale
Company Secretary
27 August 2010
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR EQLFLBVFZBBD
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