TIDMHSM
RNS Number : 1536F
Heath(Samuel) & Sons PLC
11 July 2019
HEATH (SAMUEL) & SONS PLC
11th JULY 2019
PRELIMINARY RESULTS FOR THE YEARED 31ST MARCH 2019
CHAIRMAN'S STATEMENT
It is pleasing to report the results for the year, in which
revenue was a little down, but underlying operating profits
improved.
Sales revenue was GBP13.89m (2018: GBP14.35m) and profit before
tax was GBP0.88m (2018: GBP1.18m). This was after the exceptional
item for Guaranteed Minimum Pension (GMP) Equalisation relating to
our pension fund which we have had to recognise this year. The
operating profit was better than last year at GBP1.38m (2018:
GBP1.34m) reflecting savings made through overheads.
As I am certain shareholders are aware, this year has been the
same as the one before with regard to trading conditions. The
uncertainty around Brexit has caused us all sorts of continuing
problems. These are perhaps surprisingly not led by uncertainty of
sales to business customers within the EU, but much more seriously
from our supplies from there. It is having, most importantly of
all, a very bad effect on our business, and our future prospects,
with our London and South Eastern customers within the UK.
It is therefore more difficult than ever to forecast where we
might be in twelve months' time. You can imagine that I do not
enjoy being so indecisive, but it is a unique situation we find
ourselves in. Perhaps I could add, as a company listed on the
London Stock Exchange since 1890, there must have been other times
equally difficult, which we managed to get through.
Having said that, overall business activity has held up well up
to the time of writing this statement. This has undoubtedly been
helped by our considerable investment in some excellent designs and
products, together with that in plant, machinery and IT systems in
order to manufacture them efficiently.
Our current profitability allows us to recommend, in addition to
the interim dividend of 5.5p per share which was paid 23(rd) March
219, a final dividend at the same level as last year, at 6.875p per
share, which will be paid on 16th August 2019 to shareholders
registered as at 19th July 2019.
Sam Heath
Chairman
10th July 2019
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014.
For further information:
Samuel Heath & Sons Plc
Simon Latham - Company Secretary +44 (0)121 766 4200
Cairn Financial Advisers LLP +44 (0)20 7213 0880
James Caithie/Jo Turner
CONSOLIDATED INCOME STATEMENT FOR THE YEARED 31st MARCH 2019
2019 2018
Note
GBP000 GBP000
Revenue 3 13,893 14,354
Cost of sales (7,125) (7,232)
Gross profit 6,768 7,122
Selling & distribution costs (3,474) (3,767)
Administrative expenses (1,915) (2,020)
Operating profit (a) 1,379 1,335
Finance income 13 30
Finance cost (211) (188)
Profit before taxation and exceptional
items 1,181 1,177
Exceptional item - GMP equalisation 7 (299) -
Profit before taxation 882 1,177
Taxation 4 (144) (197)
Profit for the year attributable
to owners of the parent company 738 980
Basic and diluted earnings per
ordinary share 6 29.1p 38.7p
============= ========
(a) Operating profit is calculated as profit before net finance costs,
exceptional items and taxation.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31st March 2019
2019 2018
GBP000 GBP000
Profit for the year 738 980
Items that will not be reclassified
to profit or loss:
Actuarial loss on defined benefit
pension scheme (933) (234)
Deferred taxation on actuarial
loss 159 40
Deferred taxation on revaluation
of assets - 44
------------- --------
(774) (150)
Total comprehensive income for
the year (36) 830
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CONSOLIDATED STATEMENT OF FINANCIAL POSITION AT 31st MARCH
2019
2019 2018
GBP000 GBP000
Non-current assets
Intangible assets 82 85
Property, plant and equipment 3,210 3,337
Deferred tax asset 1,048 853
--------- --------
4,340 4,276
Current assets
Inventories 3,989 3,930
Trade and other receivables 2,286 2,287
Cash and cash equivalents 3,153 2,366
--------- --------
9,428 8,583
Total assets 13,768 12,859
Current liabilities
Trade and other payables (1,789) (1,474)
Current tax payable (171) (175)
--------- --------
(1,960) (1,649)
Non-current liabilities
Retirement benefit scheme (7,420) (6,472)
Total liabilities (9,380) (8,121)
Net assets 4,388 4,738
--------- --------
Equity
Called up share capital 254 254
Capital redemption reserve 109 109
Revaluation reserve 1,277 1,357
Retained earnings 2,748 3,018
Equity shareholders' funds 4,388 4,738
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEARED 31st
MARCH 2019
Share Capital Revaluation Retained Total
capital redemption reserve earnings Equity
reserve
GBP000 GBP000 GBP000 GBP000 GBP000
Balance at 31st March 2017 254 109 1,389 2,609 4,361
-------- ----------- ----------- --------- -------
Total transactions with owners
Equity dividends paid - - - (453) (453)
-------- ----------- ----------- --------- -------
Profit for the year - - - 980 980
Reclassification of depreciation
on revaluation - - (76) 76 -
Other comprehensive income
for the year - - 44 (194) (150)
-------- ----------- ----------- --------- -------
Total comprehensive income
for the year - - (32) 862 830
Balance at 31st March 2018 254 109 1,357 3,018 4,738
Total transactions with owners
Equity dividends paid - - - (314) (314)
-------- ----------- ----------- --------- -------
Profit for the year - - - 738 738
Reclassification of depreciation
on revaluation (80) 80 -
Other comprehensive income
for the year - - - (774) (774)
-------- ----------- ----------- --------- -------
Total comprehensive income
for the year - - (80) 44 (36)
Balance at 31st March 2019 254 109 1,277 2,748 4,388
-------- ----------- ----------- --------- -------
CONSOLIDATED STATEMENT OF CASHFLOWS FOR THE YEARED 31st MARCH
2019
2019 2018
GBP000 GBP000
Cash flow from operating activities
Profit for the year before taxation 882 1,177
Adjustments for:
Depreciation 348 365
Amortisation 27 58
Profit on disposal of property, plant and equipment (16) (10)
Net finance (income)/cost 17 (30)
Defined benefit pension scheme expenses 530 237
Contributions to defined benefit pension scheme (516) (500)
Operating cash flow before movements in working
capital 1,272 1,297
Changes in working capital:
Increase in inventories (59) (141)
Decrease/ (increase) in trade and other receivables 6 (118)
Increase in trade and other payables 310 74
Cash generated from operations 1,529 1,112
Taxation paid (184) (157)
Net cash from operating activities 1,345 955
Cash flows from investing activities
Payments to acquire property, plant and equipment (239) (222)
Proceeds from the sale of property, plant and
equipment 35 41
Payments to acquire intangible assets (23) (64)
Finance (costs)/income (17) 30
(244) (215)
Cash flows from financing activities
Dividends paid (314) (453)
(314) (453)
Net increase in cash and cash equivalents 787 287
Cash and cash equivalents at beginning of year 2,366 2,079
Cash and cash equivalents at end of year 3,153 2,366
NOTES TO THE PRELIMINARY ANNOUNCEMENT
1. Basis of preparation
The Group has prepared its consolidated financial statements for
the year ended 31st March 2019 in accordance with International
Financial Reporting Standards as adopted by the European Union.
There was no impact on the reported results due to the adoption of
IFRS 9 and IFRS 15. The accounting policies applied are consistent
with those included in the financial statements of the Group for
the year ended 31st March 2018 except for changes required on the
adoption of IFRS 15 "Revenue from Contracts with Customers" and
IFRS 9 "Financial Instruments".
The financial information contained in this preliminary
announcement does not constitute the Group's statutory accounts
within the meaning of Section 434 of the Companies Act 2006.
The annual report and financial statements for the year ended
31st March 2019 were approved by the Board of Directors on 10th
July 2019 along with this preliminary announcement. The annual
report and financial statements will be delivered to the Registrar
of Companies after the Annual General Meeting.
The statutory accounts of Samuel Heath & Sons PLC for the
year ended 31 March 2018 have been delivered to the Registrar of
Companies. The auditor's reports on the statutory accounts for the
years ended 31st March 2019 and 31st March 2018 were unqualified
and did not contain a statement under section 498 of the Companies
Act 2006.
2. Critical accounting and key sources of estimation
Critical accounting estimates, assumptions and judgements
Estimates and judgements are continually evaluated and are based
on historical experience and other factors, including expectations
of future events that are believed to be reasonable under the
circumstances.
The Group makes estimates and assumptions concerning the future.
The resulting accounting estimates and assumptions will, by
definition, seldom equal the related actual results. The Group has
evaluated the estimates and assumptions that have been made in
relation to the carrying amounts of assets and liabilities in these
financial statements.
The key accounting judgements and sources of estimation
uncertainty with a significant risk of causing a material
adjustment to assets and liabilities in the next 12 months include
the following:
Pensions - movements in equity markets, interest rates and life
expectancy could materially affect the level of surpluses and
deficits in the defined benefit pension scheme.
Valuation of property, plant and equipment - the Group reviews
the value, useful economic lives and residual values attributed to
assets on an on-going basis to ensure they are appropriate. Changes
in market value, economic lives or residual values could impact the
carrying value and charges to the income statement in future
periods.
Provisions - using information available at the balance sheet
date, the Directors make judgements based on experience on the
level of provision required against assets, including inventory and
trade receivables. Further information received after the balance
sheet date may impact the level of provision required.
Deferred tax assets - deferred tax assets are recognised to the
extent that it is probable that taxable profit will be available
against which the losses can be utilised. Management judgement is
required to determine the amount of deferred tax assets that can be
recognised, based upon the likely timing and level of future
taxable profits.
3. Revenue by geographic
market
2019 2018
GBP000 GBP000
Overseas 6,027 6,013
Home 7,866 8,341
13,893 14,354
------- -------
4. Income taxes
2019 2018
GBP000 GBP000
Current taxes:
Current year 169 175
Adjustments in respect of prior periods (11) (1)
-------- --------
180 174
Deferred taxes:
Origination and reversal of temporary differences (36) 23
Total income taxes 144 197
-------- --------
Corporation tax is calculated at 19% (2018: 19%) of the
estimated assessable profit for the year.
Tax reconciliation
2019 2018
GBP000 GBP000
Profit for the year 882 1,177
-------- -------
Corporation tax charge thereon at 19% (2018:
19%) 168 224
Adjusted for the effects of:
Prior year adjustments 11 (1)
Research and development claim (7) (22)
Other adjustments (28) (4)
Total income taxes 144 197
-------- -------
Effective tax rate 16.3% 16.7%
-------- -------
5. Dividends
2019 2018
GBP000 GBP000
Final dividend for the year ended 31st March
2018 of 6.875 pence per share (2017: 6.875
pence per share) 174 174
Interim dividend for the year ended 31st
March 2017 of 5.50 pence per share - 139
Interim dividend for the year ended 31st
March 2019 of 5.50 pence per share (2018:
5.50 pence per share) 139 139
313 452
------ ------
In addition to the dividends paid during the year the directors
are recommending a final dividend for 2019 of 6.875 pence per share
amounting to GBP174,000. The proposed final dividend is subject to
approval at the Annual General Meeting and hence 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 GBP738,000 (2018:
GBP980,000) by the average number of ordinary shares in issue
during the year being 2,534,322 (2018: 2,534,322). The number of
shares used in the calculation is the same for both basic and
diluted earnings.
7. Exceptional item
The business has recognised the past service cost resulting from
Guaranteed Minimum Pension (GMP) equalisation as an exceptional
item on the basis that it is a one off cost of substance arising
from a legal case during the financial year.
GMP equalisation is the recognition that during the 1990s
benefits accrued differently for men and women based on their then
different retirement ages.
8. Notice of annual general meeting
Notice is hereby given that the 2019 Annual General Meeting of
the Company will be held at the registered office of the Company,
Leopold Street, Birmingham, on 9(th) August 2019 at 12.00 noon. The
final dividend of 6.875 pence, if approved, will be payable on
16(th) August 2019 to ordinary shareholders registered at close of
business on 19(th) July 2019.
9. Posting of accounts
The report and accounts are being posted to shareholders today
where requested, and are available on the Company's website, at
www.samuel-heath.com/investor-relations.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR SFUFMSFUSELW
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