TIDMHSM
RNS Number : 4496J
Heath(Samuel) & Sons PLC
17 July 2013
HEATH (Samuel) & SONS PLC
17th JULY 2013
PRELIMINARY RESULTS FOR THE YEAR ENDED 31ST MARCH 2013
CHAIRMAN'S STATEMENT
During the long period I have been reporting on our annual
results, the past trading year has been the most unpredictable.
This time last year business had improved quite a lot and I was
able to be cautiously optimistic. Then it all went backwards and at
the interim stage looked bleak. Fortunately at the end of February
orders increased and we ended the year very well.
All this has resulted in a profit before taxation only
fractionally up at GBP633,000 (2012: GBP632,000) on sales also
slightly up at GBP10,083,000 (2012: GBP9,782,000). This however
should be looked at together with an operating profit of GBP398,000
as against GBP556,000 in the previous year.
I feel that I should point out that for the financial year
ending 31(st) March 2014, the introduction of the revised
accounting standard in relation to Retirement Benefit Pension
Schemes (IAS19 Employee Benefits) will have a significant effect on
our profits reported in the Income Statement. At present, the
finance cost is the company's best estimate of the expected return
on the scheme assets, less the interest on the liabilities
calculated using the discount rate for the period. The net finance
cost will in future be calculated as the interest on the scheme
deficit using the discount rate. In addition, the administration
costs of the scheme, other than those relating to investment
management, will need to be expensed as they are incurred. If the
accounting standard had been adopted for the year ended 31(st)
March 2013, the profit before tax would have been reduced by
GBP183,000 to GBP450,000. The changes in the standard will not
affect the overall deficit but merely reclassify the disclosure of
the scheme's costs between the Income Statement and the
Consolidated Statement of Comprehensive Income.
We continue to produce new lines at an ever increasing rate, the
highlights being our Style Moderne bathroom taps and fittings and a
new swing free door closer in our Perko range. We also continue to
invest in new plant and IT programmes to manage our increasingly
wide range of products.
What then for the future? You can imagine from what I have said
above, that it is extremely difficult to predict. In view of our
experiences last year we have budgeted cautiously. Although trading
was very satisfactory in April and May, orders have since tailed
off. There is scarcely a market, in which we sell, which does not
have a problem. Parts of the U.K. for example are still suffering
badly.
Our assets remain strong and we therefore propose a same again
final dividend of 6.25p per share, making a total of 11.75p for the
year.
Sam Heath
Chairman
17(th) July 2013
For further information:
Samuel Heath & Sons Plc
John Park - Company Secretary 0121 772 2303
Zeus Capital Limited 0161 831 1512
Ross Andrews/Nick Cowles
CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 MARCH
2013
Note 2013 2012
GBP000 GBP000
Continuing operations
Revenue 10,083 9,782
Cost of sales (5,311) (4,936)
---------------- ----------
Gross profit 4,772 4,846
Distribution costs (2,870) (2,840)
Administrative expenses (1,504) (1,450)
Operating profit 398 556
Gain on sale of financial assets 132 16
Finance income 640 594
Finance costs (537) (534)
Profit before taxation 633 632
Taxation 4 (78) (117)
Profit for the year 555 515
================ ==========
Basic and diluted earnings per
ordinary share 6 21.9p 20.3p
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
2013 2012
GBP000 GBP000
Profit for year 555 515
Actuarial loss on defined benefit
pension scheme (1,743) (1,712)
Deferred taxation on actuarial
loss 372 365
(Loss)/gain on available for sale
financial assets (17) 28
Cash flow hedges (3) (2)
Other comprehensive income (1,391) (1,321)
Total comprehensive income for
the year (836) (806)
================ ==========
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AT 31 MARCH
2013
2013 2012
GBP000 GBP000
Non current assets
Intangible assets 370 260
Property, plant and equipment 1,838 1,948
Deferred tax asset 986 696
------- -------
3,194 2,904
------- -------
Current assets
Inventories 2,731 2,615
Trade and other receivables 1,909 1,873
Derivative financial instruments 1 -
Available for sale financial
assets 1,400 1,540
Cash and cash equivalents 219 477
------- -------
Total current assets 6,260 6,505
Total assets 9,454 9,409
------- -------
Current liabilities
Trade and other payables (949) (1,092)
Derivative financial instruments (4) -
Current tax payable (15) (62)
------- -------
Total current liabilities (968) (1,154)
------- -------
Non current liabilities
Retirement benefit scheme (4,290) (2,901)
Deferred tax liability (84) (108)
------- -------
Total non current liabilities (4,374) (3,009)
Total liabilities (5,342) (4,163)
Net assets 4,112 5,246
======= =======
Equity
Called up share capital 254 254
Capital redemption reserve 109 109
Retained earnings 3,749 4,883
------- -------
Equity shareholders' funds 4,112 5,246
======= =======
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED
31 MARCH 2013
Share Capital Retained Total
capital redemption earnings Equity
reserve
GBP000 GBP000 GBP000 GBP000
Balance at 31st March 2011 254 109 5,987 6,350
Equity dividends paid - - (298) (298)
Profit for year - - 515 515
Other comprehensive income
for the year - - (1,321) (1,321)
Balance at 31st March 2012 254 109 4,883 5,246
Equity dividends paid - - (298) (298)
Profit for year - - 555 555
Other comprehensive income
for the year - - (1,391) (1,391)
Balance at 31st March 2013 254 109 3,749 4,112
CONSOLIDATED STATEMENT OF CASHFLOWS FOR THE YEAR ENDED 31 MARCH
2013
Note 2013 2012
GBP000 GBP000
Net cash inflow from operating activities 7 72 390
Cash flow from investing activities
Purchases of property, plant and equipment (268) (235)
Proceeds from sale of property, plant and
equipment 6 46
Purchase of intangible assets (117) (60)
Purchase of available for sale financial
assets (421) (465)
Proceeds from sale of available for sale
financial assets 676 474
Interest received 92 72
Net cash outflow from investing activities (32) (168)
Net cash outflow from financing activities
Equity dividends paid 5 (298) (298)
Net cash outflow from financing activities (298) (298)
Decrease in cash and cash equivalents (258) (76)
Cash and cash equivalents at beginning
of period 477 553
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Cash and cash equivalents at end of period 219 477
====== ======
1 Adoption of new and revised Standards
The Group has adopted all of the new and revised Standards and
Interpretations issued by the International Accounting Standards
Board (IASB) and the International Financial Reporting
Interpretations Committee (IFRIC) of the IASB that are relevant to
its operations and effective for accounting periods beginning on
1st April 2012. The adoption of the following IFRSs has not
impacted upon the financial statements:
IFRS 3 - Business Combinations
IFRS 7 - Financial Instrument Disclosures
IFRS 7 - Amendments to IFRS7 Disclosures - Transfer of Financial
Assets
IAS 12 - Deferred Tax: Recovery of Underlying Assets
At the date of authorisation of these financial statements, the
following Standards and Interpretations which have not been applied
in these financial statements were in issue but not yet
effective:
IFRS 10 - Consolidated Financial Statements
IFRS 11 - Joint Arrangements
IFRS 12 - Disclosure of Interests in Other Entities
IFRS 13 - Fair Value Measurement
IAS 19 - Employee Benefits
IFRS 9 and IFRS 7 - Financial Instruments
IAS 32 - Financial Instruments (Presentation)
Amendments to IAS 1 - Presentation of items of Other
Comprehensive Income
Improvements to IAS 2011
2 Accounting policies
Basis of preparation of preliminary financial information
The financial statements, upon which this financial information
is based, have been prepared using accounting policies consistent
with International Financial Reporting Standards (IFRS).
This financial information does not constitute the Company's
statutory accounts as defined in Section 434 of the Companies Act
2006 and has been prepared on the basis of the accounting policies
set out in the financial statements for the year ended 31 March
2013. Statutory accounts for 2012 have been delivered to the
Registrar of Companies, and those for 2013 will be delivered in due
course following the company's Annual General Meeting. The auditors
have reported on the 2012 accounts and their report was
unqualified, did not include references to any matters by way of
emphasis without qualifying their report and did not contain
statements under Section 498 (2) or (3) of the Companies Act
2006.
The Annual Report and Financial Statements will be posted to
shareholders shortly and thereafter will be available from the
Company's registered office, and from the Company's website
www.samuel-heath.com.
The financial statements have been prepared under the historical
cost basis except for the valuation of Available for Sale Assets
which have been revalued to market value.
3 Critical accounting and key sources of estimation
Critical judgements in applying the entity's accounting
policies
In the process of applying the entity's accounting policies,
which are described above, the directors have made the following
judgements that have the most significant effect on the amounts
recognised in the financial statements.
Income taxes
The Group is subject to income taxes in the United Kingdom.
Judgment is required in determining the provision for income taxes.
There are many transactions and calculations for which the ultimate
tax determination is uncertain during the ordinary course of
business. The Group recognises liabilities for anticipated tax
audit issues based on estimates of whether additional taxes will be
due. Where the final tax outcome of these matters is different from
the amounts that were initially recorded, such differences will
impact the income tax and deferred tax provisions in the period in
which such determination is made.
The recoverable amounts of the Group's deferred tax assets have
been determined based on the Board's estimates of future taxable
profits and income and tax rates.
Key sources of estimation uncertainty
The key assumptions concerning the future, and other key sources
of estimation uncertainty at the balance sheet date, that have a
significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year,
are discussed below.
Valuation of intangible assets
Intangible assets are initially valued at their cost and then
evaluated periodically for impairment. For purposes of valuation an
intangible asset is considered impaired if its carrying value is
less than the expected net cash flow from the asset.
Valuation of inventories
Determining the valuation of inventories requires an estimation
of the obsolescence provision required to write down items to their
realisable value.
Retirement benefit scheme deficit
The valuation of expected returns on assets and the present
value of the liabilities of the scheme are determined by
assumptions and estimates made by the directors based on the
current information to hand. Therefore amounts are open to
fluctuations in the future due to unforeseen changes or additional
factors that come to light following the year end.
4. Income taxes
2013 2012
GBP000 GBP000
Current taxes 20 67
Deferred taxes 58 50
-------- --------
Total income taxes 78 117
-------- --------
Corporation tax is calculated at 20% (2012: 26%) of the
estimated assessable profit for the year.
Tax rate reconciliation
2013 2012
GBP000 GBP000
Profit for the year 633 632
-------- ---------
Corporation tax charge thereon at 20% (2012:
26%) 127 164
Adjusted for the effects of:
Depreciation in excess of capital allowances 7 13
Marginal relief - (20)
Prior year adjustments 1 1
Research and development claim (28) (16)
Capitalisation of research and development
expenditure (23) (16)
Loan relationships (13) 10
Other adjustments 7 (19)
-------- ---------
Total income taxes 78 117
-------- ---------
Effective tax rate 12.3% 18.5%
-------- ---------
5. Dividends
2013 2012
GBP 000 GBP 000
Final dividend for the year ended 31st March
2012 of 6.25 pence per share (2011: 6.25
pence per share) 158 158
Interim dividend for the year ended 31st
March 2013 of 5.50 pence per share (2012:
5.50 pence per share) 140 140
298 298
In addition to the dividends paid during the year the directors
are recommending a final dividend for 2013 of 6.25 pence per share
amounting to GBP158,000. The proposed final dividend is subject to
approval at the Annual General Meeting (see note 8) and has not
been included as a liability in these accounts.
6. Earnings per share
The basic and diluted earnings per share are calculated by
dividing the relevant profit after taxation of GBP555,000 (2012:
GBP515,000) by the average number of ordinary shares in issue
during the year being 2,534,322 (2012: 2,534,322). The number of
shares used in the calculation is the same for both basic and
diluted earnings.
7. Notes to the cash flow statement
2013 2012
GBP000 GBP000
Operating profit 398 556
Depreciation, amortisation and impairment 385 411
Gain on disposal of property, plant and equipment (6) (29)
Operating cash flows before movements in
working capital 777 938
Increase in inventories (116) (68)
(Increase)/decrease in receivables (29) 37
Decrease in payables (143) (74)
Pension contributions (350) (350)
Cash generated by operations 139 483
Income tax paid (67) (93)
Net cash flow from operating activities 72 390
====== ======
Cash and cash equivalents (which are presented as a single class
of assets on the face of the Statement of Financial Position)
comprise cash at bank and other short-term highly liquid
investments with a maturity of three months or less.
8. Notice of annual general meeting
Notice is hereby given that the 2013 Annual General Meeting of
the Company will be held at the registered office of the Company,
Leopold Street, Birmingham, on 16(th) August 2013 at 12.00 noon.
The final Ordinary Share dividend of 6.25 pence, if approved, will
be payable on 23rd August 2013 to ordinary shareholders registered
at close of business on 26th July 2013.
This information is provided by RNS
The company news service from the London Stock Exchange
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