TIDMSTT
RNS Number : 7932Z
Straight PLC
29 September 2009
?
29 September 2009
STRAIGHT PLC
Interim Results
for the six months ended 30 June 2009
Straight plc (AIM:STT.L), the Environmental Products and Services Group and the
UK's leading supplier of recycling containers, is pleased to announce its
interim results for the six months ended 30 June 2009.
Highlights:
* Revenue increased by 27% to GBP17.2m (H1 2008: GBP13.5m)
* Headline operating profits substantially increased to GBP0.9m (H1 2008:
GBP0.1m)
* Adjusted earnings per share increased to 6.1p (H1 2008: 0.9p)
* Cash balances increased to GBP2.3m (31 December 2008: GBP1.6m)
* Interim dividend increased 30% to 1.3p per share (H1 2008: 1.0p)
Commenting on the results, James Newman, Chairman of Straight said:
"These results represent an excellent performance in difficult economic
conditions. The Group's Trade Business remains strong and is now better placed
to withstand changes our markets might face.In addition, the Group's Retail
Business continues to trade in line with the Board's expectations and is
expected to grow profitably in 2010."
"To date, the second half of the year has continued in line with the Board's
forecast and, as a consequence, the Group anticipates that its full year
performance will be in line with market expectations."
Chief Executive, Jonathan Straight added:
"This excellent first half provides a solid foundation for the remainder of the
year. The Group is working to maximise opportunities in its core markets and is
continuing to broaden its product base which will allow it to leverage its
unique business model in new markets."
For further information contact:
+-----------------------------------------------+----------------------------+
| Straight plc | |
+-----------------------------------------------+----------------------------+
| James Newman, Chairman / Jonathan Straight, | 07850 672727 / 07977 |
| CEO | 002366 |
+-----------------------------------------------+----------------------------+
| | |
+-----------------------------------------------+----------------------------+
| Panmure Gordon | |
+-----------------------------------------------+----------------------------+
| Andrew Godber | 0207 459 3600 |
+-----------------------------------------------+----------------------------+
| | |
+-----------------------------------------------+----------------------------+
| Redleaf Communications | |
+-----------------------------------------------+----------------------------+
| Paul Dulieu / Sam Robbins | 020 7566 6700 |
+-----------------------------------------------+----------------------------+
| | |
+-----------------------------------------------+----------------------------+
Notes to Editors
* Straight plc is the UK's leading supplier of specialist kerbside recycling
containers as well as a key supplier of a broad range of waste and recycling
container solutions. Founded in 1993 by the current Chief Executive, Jonathan
Straight, the business has since supplied more than 12 million kerbside
recycling boxes to local authorities across the UK, securing its position as the
industry leader.
* In 2005, Straight acquired Blackwall Limited, the UK's largest supplier of home
composters and water butts. Through the Blackwall brand, Straight has delivered
more than 3.5 million compost bins and water butts.
* The business operates through two divisions. The core Trade Business supplying
products in bulk to local authorities, utilities, the waste industry, retailers
and other businesses and the Retail Business supplying a range of proprietary
environmentally friendly consumer products directly to the public, often in
partnership with a local authority or a utility.
* Straight operates a radical business model with all manufacture outsourced on an
international basis. Most production is local to the end market keeping freight
movements and associated emissions to a minimum.
* In February 2009, Straight added to its portfolio with the acquisition of
Harcostar Garden Products, a long established premium brand consisting of water
butts, compost bins, watering cans and accessories. This has gained new
distribution channels for the business in the UK and in Europe.
* Straight plc has established diverse overseas sales channels and is now
producing and selling water butts in Australia as well as strong initial sales
in the United States and Canada.
* Further information about the company and its products can be found at:
www.straight.co.uk
CHAIRMAN'S STATEMENT
I am delighted to report a much improved trading performance for the first half
of 2009. This improvement follows on from the strategic review carried out last
year and a record order book at the start of the year.
Results
Revenue for the period was GBP17.2m (H1 2008: GBP13.5m) an increase of 27% and
an excellent performance in difficult economic conditions.
Trade Business
The Group's Trade Business has exhibited strong growth with revenue for the six
months to 30 June 2009 of GBP16.5m (H1 2008: GBP12.1m), an increase of 36%. The
substantial investment made last year in new products has enabled the Group to
capitalise on its leading market share in the supply of food waste containers,
the biggest growth market in the sector.
In order to reduce its reliance on the UK Municipal sector, the Group has
developed new markets both at home and overseas. Substantial progress has been
made in the Garden and Hardware sectors and with waste management companies.
Gross margins for the period increased slightly from 17.4% to 17.5% despite the
dramatic increase in sales. This is testament to the Group's strong market
position and the quality of its commercial team.
Retail Business
The rationalisation of the Retail Business last autumn has resulted in a
complete turn-around in trading performance. Excluding depreciation and from a
lower sales base of GBP0.7m (H1 2008: GBP1.4m) this part of the Group made a
small profit compared to a substantial loss in the same period in the previous
year.
This business is now in a strong position to take advantage of WRAP's withdrawal
from the English home compost bin market and should make a more significant
contribution in 2010.
Central costs
Costs have been well controlled in the period with additional expenditure being
made only where there has been increased activity.
The strong sales performance of the Trade Business and the turnaround in
the Retail Business have meant that the headline operating profit for the Group
was GBP0.9m in the period (H1 2008: GBP0.1m), returning to profitability levels
last seen three years ago. After a small amount of interest received on its cash
balances, the Group recorded a profit before taxation of GBP1.0m. This is in
stark contrast to the previous year when a loss of GBP1.0m was reported
following a goodwill impairment charge of GBP1.0m.
Earnings per Share
Adjusted earnings per share for the period were 6.1p (H1 2008: 0.9p) with basic
earnings per share of 5.9p (H1 2008 loss: 8.3p).
Dividend
The Board remains confident in the underlying strength of the business and has
declared an interim dividend of 1.3p per share (H1 2008: 1.0p), which will be
payable on 18 December 2009 to shareholders on the register at 20 November 2009.
Acquisitions
In January 2009, the Group acquired the assets and trade of Harcostar Garden
Products for a cash consideration of GBP0.4m. This long established premium
brand has enhanced the Group's distribution in the UK Garden market as well as
helping to establish a foothold in Europe.
The acquisition has been an immediate success and has made a significant
contribution to Group profitability in the period.
Outlook
The Group's Trade Business remains strong and is now better placed to withstand
changes our markets might face.In addition, the Group's Retail Business
continues to trade in line with the Board's expectations and is expected to grow
profitably in 2010.
To date, the second half of the year has continued in line with the Board's
forecast and, as a consequence, the Group anticipates that its full year
performance will be in line with market expectations.
James H Newman
Chairman
29 September 2009
OPERATING REVIEW
The Group's performance this year to date has been much improved and exceeds
original expectations. This is a direct result of the bold investments in new
products made in the previous year and follows the tough decisions taken on
general restructuring, in particular concerning the Retail Business, during the
previous financial year.
Trade Business
Municipal Recycling Containers
Performance in the municipal sector has remained strong, being driven by an
increase in sales of food waste containers for use both in the kitchen and also
at the kerbside. The development of a broad range for this market, combined with
earlier investment in multiple moulds, has afforded us first mover advantage
with sufficient available capacity to meet current market demands.
The Steelybin metal four-wheeled waste and recycling container has been well
received and is now firmly established with repeat orders from a growing number
of customers. We believe that we are now second in the UK market from a standing
start less than two years ago and with activity gathering momentum.
Corporate Recycling
At the beginning of the year, the Group set out to develop sales outside of its
core municipal market in order to broaden the range of its activities and reduce
its dependence on public spending.
The launch of the EcosortTM range of office recycling containers has been
universally well received and substantial growth from facilities management
companies and the waste management industry is expected.
Garden and Hardware
Continuing the theme of broadening the Group's spread of activity, the
acquisition of Harcostar Garden Products in January 2009, has contributed to the
growth of non-municipal sales.
This business is profitable and is characterised by repeat orders based on
strong on-going customer relationships. The acquisition has brought the Group
additional synergy gains for its core range and a foothold in the European
garden market.Sales through builders' merchants have also grown, driven by
requirements in the Code for Sustainable Homes, where the provision of water
saving and home composting facilities helps developers achieve a higher level of
compliance.
Overseas Markets
Overseas growth has been spearheaded by Harcostar sales in Europe. Local
manufacture in Australia has helped to maintain our market position there and
the groundwork has been completed for manufacturing to commence in North
America, where sales of a number of our product ranges are anticipated.
Retail Business
The Group's strategy of focussing on strategically important customers and
proprietary products has succeeded in reducing fixed overheads. In addition,
the re-building of the Group's home delivery network has reduced
distribution
costs by almost 50%. These actions have increased gross margins
from 2% to 20% compared to the same period in 2008 and have transformed this
business, which made substantial losses in 2008.
Prospects for the Retail Business are promising. Since the government agency
WRAP announced that it would withdraw from the English home compost bin market
at the end of September 2009, more than one third of council districts have
signed up for the Straight home delivery programme.
Cash Generation
In the current economic climate the Board considers cash generation to be a key
priority. Cash balances increased by GBP0.8m in the first half, despite the
acquisition of Harcostar for GBP0.4m in cash.
Further new product investment is expected in the second half of the year and
the Group will continue to focus on cash generation in order to fund this.
Outlook
This excellent first half performance provides a solid foundation for the
remainder of the year. The Group is working to maximise opportunities in its
core markets and is continuing to broaden its product base which will allow it
to leverage its unique business model in new markets.
Jonathan M Straight
Chief Executive
29 September 2009
Unaudited Condensed Consolidated Income Statement
For the 6 months ended 30 June 2009
+---------------+----------+----------+----------+----------+
| | | Half | Half | Year |
| | | year to | year to | ended |
+---------------+----------+----------+----------+----------+
| | | 30 June | 30 June | 31 Dec |
| | | 2009 | 2008 | 2008 |
+---------------+----------+----------+----------+----------+
| | Note | GBP'000 | GBP'000 | GBP'000 |
+---------------+----------+----------+----------+----------+
| | | | | |
+---------------+----------+----------+----------+----------+
| Revenue | 2 | 17,159 | 13,485 | 25,437 |
+---------------+----------+----------+----------+----------+
| Cost of | | (14,128) | (11,357) | (21,075) |
| sales | | | | |
+---------------+----------+----------+----------+----------+
| | | ______ | ______ | _____ |
+---------------+----------+----------+----------+----------+
| Gross | 2 | 3,031 | 2,128 | 4,362 |
| profit | | | | |
+---------------+----------+----------+----------+----------+
| | | | | |
+---------------+----------+----------+----------+----------+
| Operating | | (2,082) | (2,064) | (3,949) |
| costs | | | | |
+---------------+----------+----------+----------+----------+
| | | ______ | ______ | _____ |
+---------------+----------+----------+----------+----------+
| Operating | | 949 | 64 | 413 |
| profit | | | | |
| before | | | | |
| impairment | | | | |
| of | | | | |
| goodwill | | | | |
+---------------+----------+----------+----------+----------+
| and | | | | |
| strategic | | | | |
| review of | | | | |
| the | | | | |
| business | | | | |
+---------------+----------+----------+----------+----------+
| | | | | |
+---------------+----------+----------+----------+----------+
| Strategic | | - | - | (396) |
| review of | | | | |
| the | | | | |
| business | | | | |
+---------------+----------+----------+----------+----------+
| Goodwill | 3 | - | (1,026) | (1,026) |
| impairment | | | | |
+---------------+----------+----------+----------+----------+
| | | _____ | _____ | _____ |
+---------------+----------+----------+----------+----------+
| Operating | | 949 | (962) | (1,009) |
| profit/(loss) | | | | |
+---------------+----------+----------+----------+----------+
| | | | | |
+---------------+----------+----------+----------+----------+
| Investment | | 2 | 26 | 37 |
| income | | | | |
+---------------+----------+----------+----------+----------+
| | | _____ | _____ | _____ |
+---------------+----------+----------+----------+----------+
| | | | | |
+---------------+----------+----------+----------+----------+
| Profit | | 951 | (936) | (972) |
| before | | | | |
| taxation | | | | |
+---------------+----------+----------+----------+----------+
| Income | 4 | (267) | (21) | (52) |
| tax | | | | |
| expense | | | | |
+---------------+----------+----------+----------+----------+
| | | _____ | _____ | _____ |
+---------------+----------+----------+----------+----------+
| Profit/(loss) | | 684 | (957) | (1,024) |
| for the | | | | |
| period | | | | |
| attributable | | | | |
| to the | | | | |
+---------------+----------+----------+----------+----------+
| equity | | _____ | _____ | _____ |
| holders | | | | |
| of the | | | | |
| Company | | | | |
+---------------+----------+----------+----------+----------+
| | | | | |
+---------------+----------+----------+----------+----------+
Earnings per share for profit attributable to the
equity holders of the Company during the period
+--------------------------------+-------+----------+--------+---------+
| Adjusted | 6 | 6.1p | 0.9p | 4.6p |
+--------------------------------+-------+----------+--------+---------+
| Basic | 6 | 5.9p | (8.3p) | (8.9p) |
+--------------------------------+-------+----------+--------+---------+
| Diluted Basic | 6 | 5.9p | (8.3p) | (8.9p) |
+--------------------------------+-------+----------+--------+---------+
Unaudited Condensed Consolidated Statement of Changes in Equity
For the 6 months ended 30 June 2009
+----------------------------------+----+----------+----------+----------+
| | | Half | Half | Year |
| | | year to | year to | ended |
+----------------------------------+----+----------+----------+----------+
| | | 30 June | 30 June | 31 Dec |
| | | 2009 | 2008 | 2008 |
+----------------------------------+----+----------+----------+----------+
| | | GBP'000 | GBP'000 | GBP'000 |
+----------------------------------+----+----------+----------+----------+
| | | | | |
+----------------------------------+----+----------+----------+----------+
| Balance at start of period | | 8,918 | 10,212 | 10,212 |
+----------------------------------+----+----------+----------+----------+
| | | | | |
+----------------------------------+----+----------+----------+----------+
| Profit/(loss) for the period | | | | |
| attributable to the equity | | | | |
+----------------------------------+----+----------+----------+----------+
| Holders of the Company | | 684 | (957) | (1,024) |
+----------------------------------+----+----------+----------+----------+
| Arising on grant of share | | 13 | 37 | 75 |
| options | | | | |
+----------------------------------+----+----------+----------+----------+
| Dividends paid | | (230) | (230) | (345) |
+----------------------------------+----+----------+----------+----------+
| | | ______ | ______ | ______ |
+----------------------------------+----+----------+----------+----------+
| | | | | |
+----------------------------------+----+----------+----------+----------+
| | | 9,385 | 9,062 | 8,918 |
+----------------------------------+----+----------+----------+----------+
| | | ______ | ______ | ______ |
+----------------------------------+----+----------+----------+----------+
| | | | | |
+----------------------------------+----+----------+----------+----------+
Unaudited Condensed Consolidated Balance Sheet
At 30 June 2009
+-----------------------------+--------+----------+---------+---------+
| | | 30 June | 30 | 31 Dec |
| | | | June | |
+-----------------------------+--------+----------+---------+---------+
| | | 2009 | 2008 | 2008 |
+-----------------------------+--------+----------+---------+---------+
| | | GBP'000 | GBP'000 | GBP'000 |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
| Assets | | | | |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
| Non current assets | | | | |
+-----------------------------+--------+----------+---------+---------+
| Property, plant and | | 3,016 | 2,135 | 2,776 |
| equipment | | | | |
+-----------------------------+--------+----------+---------+---------+
| Intangible assets | | 4,777 | 4,844 | 4,741 |
+-----------------------------+--------+----------+---------+---------+
| Investments | | 35 | 35 | 35 |
+-----------------------------+--------+----------+---------+---------+
| | | _____ | _____ | _____ |
+-----------------------------+--------+----------+---------+---------+
| | | 7,828 | 7,014 | 7,552 |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
| Current assets | | | | |
+-----------------------------+--------+----------+---------+---------+
| Inventories | | 1,508 | 1,594 | 1,533 |
+-----------------------------+--------+----------+---------+---------+
| Trade and other receivables | | 5,080 | 4,493 | 3,675 |
+-----------------------------+--------+----------+---------+---------+
| Cash and cash equivalents | | 2,342 | 2,843 | 1,580 |
+-----------------------------+--------+----------+---------+---------+
| | | _____ | _____ | _____ |
+-----------------------------+--------+----------+---------+---------+
| | | 8,930 | 8,930 | 6,788 |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
| | | _____ | _____ | _____ |
+-----------------------------+--------+----------+---------+---------+
| Total assets | | 16,758 | 15,944 | 14,340 |
+-----------------------------+--------+----------+---------+---------+
| | | _____ | _____ | _____ |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
| Liabilities | | | | |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
| Non current liabilities | | | | |
+-----------------------------+--------+----------+---------+---------+
| Deferred taxation | | (120) | (45) | (120) |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
| Current liabilities | | | | |
+-----------------------------+--------+----------+---------+---------+
| Trade and other payables | | (7,009) | (6,691) | (5,302) |
+-----------------------------+--------+----------+---------+---------+
| Income tax payable | | (244) | (146) | - |
+-----------------------------+--------+----------+---------+---------+
| | | _____ | _____ | _____ |
+-----------------------------+--------+----------+---------+---------+
| | | (7,253) | (6,837) | (5,302) |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
| | | _____ | _____ | _____ |
+-----------------------------+--------+----------+---------+---------+
| Total liabilities | | (7,373) | (6,882) | (5,422) |
+-----------------------------+--------+----------+---------+---------+
| | | _____ | _____ | _____ |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
| | | _____ | _____ | _____ |
+-----------------------------+--------+----------+---------+---------+
| Net assets | | 9,385 | 9,062 | 8,918 |
+-----------------------------+--------+----------+---------+---------+
| | | _____ | _____ | _____ |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
| Equity attributable to | | | | |
| equity holders of parent | | | | |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
| Issued share capital | | 115 | 115 | 115 |
+-----------------------------+--------+----------+---------+---------+
| Share premium | | 5,970 | 5,970 | 5,970 |
+-----------------------------+--------+----------+---------+---------+
| Merger reserve | | 744 | 744 | 744 |
+-----------------------------+--------+----------+---------+---------+
| Share option reserve | | 248 | 197 | 234 |
+-----------------------------+--------+----------+---------+---------+
| Retained earnings | | 2,308 | 2,036 | 1,855 |
+-----------------------------+--------+----------+---------+---------+
| | | _____ | _____ | _____ |
+-----------------------------+--------+----------+---------+---------+
| Total equity | | 9,385 | 9,062 | 8,918 |
+-----------------------------+--------+----------+---------+---------+
| | | _____ | _____ | _____ |
+-----------------------------+--------+----------+---------+---------+
| | | | | |
+-----------------------------+--------+----------+---------+---------+
Unaudited Condensed Consolidated Cash Flow Statement
For the 6 months ended 30 June 2009
+---------------------+-----+----------+----------+----------+
| | | Half | Half | Year |
| | | year to | year to | ended |
+---------------------+-----+----------+----------+----------+
| | | 30 June | 30 June | 31 Dec |
| | | 2009 | 2008 | 2008 |
+---------------------+-----+----------+----------+----------+
| | | GBP'000 | GBP'000 | GBP'000 |
+---------------------+-----+----------+----------+----------+
| | | | | |
+---------------------+-----+----------+----------+----------+
| Cash | | | | |
| flows | | | | |
| from | | | | |
| operating | | | | |
| activities | | | | |
+---------------------+-----+----------+----------+----------+
| | | | | |
+---------------------+-----+----------+----------+----------+
| Profit/(loss) | | 684 | (936) | (1,024) |
| after tax | | | | |
+---------------------+-----+----------+----------+----------+
| Adjustments | | | | |
| for | | | | |
+---------------------+-----+----------+----------+----------+
| | | 201 | 167 | 350 |
| depreciation | | | | |
+---------------------+-----+----------+----------+----------+
| profit | | - | (7) | (7) |
| on sale | | | | |
| of | | | | |
| property, | | | | |
| plant and | | | | |
| equipment | | | | |
+---------------------+-----+----------+----------+----------+
| | | - | 1,026 | 1,040 |
| goodwill | | | | |
| impairment | | | | |
+---------------------+-----+----------+----------+----------+
| | | 79 | 78 | 167 |
| intangibles | | | | |
| amortisation | | | | |
+---------------------+-----+----------+----------+----------+
| | | (2) | (26) | (37) |
| investment | | | | |
| income | | | | |
+---------------------+-----+----------+----------+----------+
| | | 267 | 21 | 52 |
| taxation | | | | |
| expense | | | | |
| recognised | | | | |
| in income | | | | |
| statement | | | | |
+---------------------+-----+----------+----------+----------+
| share | | 13 | 37 | 75 |
| option | | | | |
| costs | | | | |
| recognised | | | | |
| in income | | | | |
| statement | | | | |
+---------------------+-----+----------+----------+----------+
| | | 25 | 92 | 153 |
| decrease | | | | |
| in | | | | |
| inventories | | | | |
+---------------------+-----+----------+----------+----------+
| increase | | (1,426) | (940) | (99) |
| in trade | | | | |
| and | | | | |
| other | | | | |
| receivables | | | | |
+---------------------+-----+----------+----------+----------+
| increase in | | 1,706 | 2,729 | 1,361 |
| trade | | | | |
| payables | | | | |
+---------------------+-----+----------+----------+----------+
| | | ____ | ____ | ____ |
+---------------------+-----+----------+----------+----------+
| Cash | | 1,547 | 2,241 | 2,031 |
| generated | | | | |
| from | | | | |
| operations | | | | |
+---------------------+-----+----------+----------+----------+
| Income | | - | - | (125) |
| tax paid | | | | |
+---------------------+-----+----------+----------+----------+
| | | ____ | ____ | ____ |
+---------------------+-----+----------+----------+----------+
| Net cash | | 1,547 | 2,241 | 1,906 |
| generated | | | | |
| from | | | | |
| operating | | | | |
| activities | | | | |
+---------------------+-----+----------+----------+----------+
| | | | | |
+---------------------+-----+----------+----------+----------+
| | | | | |
+---------------------+-----+----------+----------+----------+
| Cash | | | | |
| flows | | | | |
| from | | | | |
| investing | | | | |
| activities | | | | |
+---------------------+-----+----------+----------+----------+
| | | | | |
+---------------------+-----+----------+----------+----------+
| Purchases | | (115) | (16) | (16) |
| of | | | | |
| intangibles | | | | |
+---------------------+-----+----------+----------+----------+
| Purchases | | (442) | (789) | (1,613) |
| of | | | | |
| property, | | | | |
| plant and | | | | |
| equipment | | | | |
+---------------------+-----+----------+----------+----------+
| Proceeds | | - | 7 | 7 |
| from | | | | |
| sale of | | | | |
| property, | | | | |
| plant and | | | | |
| equipment | | | | |
+---------------------+-----+----------+----------+----------+
| Interest | | 2 | 26 | 37 |
| received | | | | |
+---------------------+-----+----------+----------+----------+
| | | ____ | ____ | ____ |
+---------------------+-----+----------+----------+----------+
| Net cash | | (555) | (772) | (1,585) |
| used in | | | | |
| investing | | | | |
| activities | | | | |
+---------------------+-----+----------+----------+----------+
| | | | | |
+---------------------+-----+----------+----------+----------+
| | | | | |
+---------------------+-----+----------+----------+----------+
| Cash | | | | |
| flows | | | | |
| from | | | | |
| financing | | | | |
| activities | | | | |
+---------------------+-----+----------+----------+----------+
| | | | | |
+---------------------+-----+----------+----------+----------+
| Dividends | | (230) | (230) | (345) |
| paid | | | | |
+---------------------+-----+----------+----------+----------+
| | | ____ | ____ | ____ |
+---------------------+-----+----------+----------+----------+
| Net cash | | (230) | (230) | (345) |
| used in | | | | |
| financing | | | | |
| activities | | | | |
+---------------------+-----+----------+----------+----------+
| | | | | |
+---------------------+-----+----------+----------+----------+
| | | ____ | ____ | ____ |
+---------------------+-----+----------+----------+----------+
| Net | | 762 | 1,239 | (24) |
| increase/(decrease) | | | | |
| in cash and cash | | | | |
| equivalents | | | | |
+---------------------+-----+----------+----------+----------+
| | | | | |
+---------------------+-----+----------+----------+----------+
| Cash and | | 1,580 | 1,604 | 1,604 |
| cash | | | | |
| equivalents | | | | |
| at | | | | |
| beginning | | | | |
| of period | | | | |
+---------------------+-----+----------+----------+----------+
| | | ____ | ____ | ____ |
+---------------------+-----+----------+----------+----------+
| Cash and | | 2,342 | 2,843 | 1,580 |
| cash | | | | |
| equivalents | | | | |
| at end of | | | | |
| period | | | | |
+---------------------+-----+----------+----------+----------+
| | | ____ | ____ | ____ |
+---------------------+-----+----------+----------+----------+
| | | | | |
+---------------------+-----+----------+----------+----------+
| | | | | |
+---------------------+-----+----------+----------+----------+
Notes to the Interim Results Announcement
For the 6 months ended 30 June 2009
1. General information
Straight plc "the Group" supplies container solutions for source separated
waste in the UK and overseas.
The Company is registered in England under
company registration number 2923140 and its registered office is No 1
Whitehall Riverside, Leeds, LS1 4BN. As a consequence of its AIM listing, the
Group is required to prepare
statutory financial statements which comply
with accounting standards as adopted for use in the European Union
"EU"
in respect of its financial year ended 31 December 2009.
These consolidated interim financial statements have been approved for issue
by the Board of Directors on
29 September 2009.
The financial information set out in this interim report does not constitute
statutory accounts as defined by the
Companies Act 2006. The Group's
statutory financial statements for the year ended 31 December 2008 have
been
filed with the Registrar of Companies. The auditor's report on
those financial statements was unqualified and did
not contain a
statement under Section 237(2) of the Companies Act 1985.
These interim financial statements have been prepared on the same basis and
using the same accounting policies
as used in the full financial
statements for the year ended 31 December 2008.
2. Segmental information
The Group's activities are organised into two segments, its "Trade"
environmental container solutions business and
its "Retail" direct to
consumer environmental products business. These divisions are the basis on
which the Group
reports its primary segmental information.
+------------------------------+---+-------------+-------------+------------+
| | | Half year | Half year | Year ended |
| | | to | to | |
+------------------------------+---+-------------+-------------+------------+
| | | 30 June | 30 June | 31 Dec |
| | | 2009 | 2008 | 2008 |
+------------------------------+---+-------------+-------------+------------+
| | | GBP'000 | GBP'000 | GBP'000 |
+------------------------------+---+-------------+-------------+------------+
| | | | | |
+------------------------------+---+-------------+-------------+------------+
| Revenue | | | | |
+------------------------------+---+-------------+-------------+------------+
| Trade | | 16,436 | 12,082 | 23,158 |
+------------------------------+---+-------------+-------------+------------+
| Retail | | 723 | 1,403 | 2,279 |
+------------------------------+---+-------------+-------------+------------+
| | | _____ | _____ | _____ |
+------------------------------+---+-------------+-------------+------------+
| | | 17,159 | 13,485 | 25,437 |
+------------------------------+---+-------------+-------------+------------+
| | | _____ | _____ | _____ |
+------------------------------+---+-------------+-------------+------------+
| | | | | |
+------------------------------+---+-------------+-------------+------------+
| Gross profit | | | | |
+------------------------------+---+-------------+-------------+------------+
| Trade | | 2,883 | 2,099 | 4,261 |
+------------------------------+---+-------------+-------------+------------+
| Retail | | 148 | 29 | 101 |
+------------------------------+---+-------------+-------------+------------+
| | | _____ | _____ | _____ |
+------------------------------+---+-------------+-------------+------------+
| | | 3,031 | 2,128 | 4,362 |
+------------------------------+---+-------------+-------------+------------+
| | | | | |
+------------------------------+---+-------------+-------------+------------+
| Operating costs before | | | | |
| impairment of goodwill and | | | | |
| strategic review of the | | | | |
| business | | | | |
+------------------------------+---+-------------+-------------+------------+
| Trade | | (1,133) | (1,048) | (2,072) |
+------------------------------+---+-------------+-------------+------------+
| Retail | | (192) | (340) | (609) |
+------------------------------+---+-------------+-------------+------------+
| Central costs | | (757) | (676) | (1,268) |
+------------------------------+---+-------------+-------------+------------+
| | | _____ | _____ | _____ |
+------------------------------+---+-------------+-------------+------------+
| | | (2,082) | (2,064) | (3,949) |
+------------------------------+---+-------------+-------------+------------+
| | | | | |
+------------------------------+---+-------------+-------------+------------+
| Operating profit before | | | | |
| impairment of goodwill and | | | | |
| strategic review of the | | | | |
| business | | | | |
+------------------------------+---+-------------+-------------+------------+
| Trade | | 1,750 | 1,051 | 2,189 |
+------------------------------+---+-------------+-------------+------------+
| Retail | | (44) | (311) | (508) |
+------------------------------+---+-------------+-------------+------------+
| Central costs | | (757) | (676) | (1,268) |
+------------------------------+---+-------------+-------------+------------+
| | | _____ | _____ | _____ |
+------------------------------+---+-------------+-------------+------------+
| | | | | |
+------------------------------+---+-------------+-------------+------------+
| | | 949 | 64 | 413 |
+------------------------------+---+-------------+-------------+------------+
| | | _____ | _____ | _____ |
+------------------------------+---+-------------+-------------+------------+
3. Impairment of goodwill in Retail business
In 2008 the directors were of the view that the recoverable amount of the
goodwill associated with
the Retail Business included in the purchase of
Blackwall Ltd in 2005 was less than its carrying value brought
forward
at the beginning of that year. Consequently the goodwill impairment of
GBP1,026,000 was included in the
operating loss in that year. The
Retail business has made good progress since its rationalisation in 2008.
The
directors remain of the opinion that it still offers real long term
strategic value and that it differentiates the Group from
its
competitors. Accordingly it has been decided that no further impairment is to be
recorded.
4. Income tax expense
+---------------------------------+--+------------+------------+-----------+
| | | | | |
+---------------------------------+--+------------+------------+-----------+
| | | Half year | Half year | Year |
| | | to | to | ended |
+---------------------------------+--+------------+------------+-----------+
| | | 30 June | 30 June | 31 Dec |
| | | 2009 | 2008 | 2008 |
+---------------------------------+--+------------+------------+-----------+
| | | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------+--+------------+------------+-----------+
| | | | | |
+---------------------------------+--+------------+------------+-----------+
| Current tax | | 267 | 21 | (23) |
+---------------------------------+--+------------+------------+-----------+
| Deferred tax | | - | - | 75 |
+---------------------------------+--+------------+------------+-----------+
| | | ____ | ____ | ____ |
+---------------------------------+--+------------+------------+-----------+
| | | 267 | 21 | 52 |
+---------------------------------+--+------------+------------+-----------+
| | | ____ | ____ | ____ |
+---------------------------------+--+------------+------------+-----------+
5. Dividends
+---------------------------------+--+------------+------------+-----------+
| | | Half year | Half year | Year |
| | | to | to | ended |
+---------------------------------+--+------------+------------+-----------+
| | | 30 June | 30 June | 31 Dec |
| | | 2009 | 2008 | 2008 |
+---------------------------------+--+------------+------------+-----------+
| | | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------+--+------------+------------+-----------+
| | | | | |
+---------------------------------+--+------------+------------+-----------+
| Amounts recognised as equity | | 230 | 230 | 345 |
| distributions in the period | | | | |
+---------------------------------+--+------------+------------+-----------+
| | | _____ | _____ | ____ |
+---------------------------------+--+------------+------------+-----------+
| | | | | |
+---------------------------------+--+------------+------------+-----------+
| Date dividend paid | | 5.6.09 | 30.5.08 | 12.12.08 |
+---------------------------------+--+------------+------------+-----------+
| Amount paid per share | | 2.0p | 2.0p | 3.0p |
+---------------------------------+--+------------+------------+-----------+
The interim dividend declared of 1.3p per share has not been included as a
liability in these financial statements.
6. Earnings per share
+----------------------------+-------+------------+------------+------------+
| | | | | |
+----------------------------+-------+------------+------------+------------+
| | | Half year | Half year | Year |
| | | to | to | ended |
+----------------------------+-------+------------+------------+------------+
| | | 30 June | 30 June | 31 Dec |
| | | 2009 | 2008 | 2008 |
+----------------------------+-------+------------+------------+------------+
| | | GBP'000 | GBP'000 | GBP'000 |
+----------------------------+-------+------------+------------+------------+
| | | | | |
+----------------------------+-------+------------+------------+------------+
| Earnings | | | | |
+----------------------------+-------+------------+------------+------------+
| | | | | |
+----------------------------+-------+------------+------------+------------+
| Earnings for the purposes | | 684 | (957) | (1,024) |
| of basic earnings per | | | | |
| share being profit for the | | | | |
| period | | | | |
+----------------------------+-------+------------+------------+------------+
| attributable to the equity | | | | |
| holders of the | | | | |
+----------------------------+-------+------------+------------+------------+
| Company | | | | |
+----------------------------+-------+------------+------------+------------+
| | | | | |
+----------------------------+-------+------------+------------+------------+
| Strategic Review of the | | - | - | 396 |
| business | | | | |
+----------------------------+-------+------------+------------+------------+
| Impairment of goodwill in | | - | 1,026 | 1,026 |
| Retail business | | | | |
+----------------------------+-------+------------+------------+------------+
| Share scheme charges | | 13 | 37 | 75 |
+----------------------------+-------+------------+------------+------------+
| Deferred tax movement | | - | - | 60 |
+----------------------------+-------+------------+------------+------------+
| | | ____ | ____ | ____ |
+----------------------------+-------+------------+------------+------------+
| Earnings for the purposes | | 697 | 106 | 533 |
| of adjusted earnings per | | | | |
| share | | | | |
+----------------------------+-------+------------+------------+------------+
| being the adjusted profit | | | | |
| for the period | | | | |
| attributable to | | | | |
+----------------------------+-------+------------+------------+------------+
| the equity holders of the | | ____ | ____ | ____ |
| company | | | | |
+----------------------------+-------+------------+------------+------------+
| | | | | |
+----------------------------+-------+------------+------------+------------+
| Number of shares | | | | |
+----------------------------+-------+------------+------------+------------+
| | | | | |
+----------------------------+-------+------------+------------+------------+
| Weighted average number of | | 11,499,294 | 11,499,294 | 11,499,294 |
| ordinary shares for the | | | | |
+----------------------------+-------+------------+------------+------------+
| purposes of basic earnings | | | | |
| per share | | | | |
+----------------------------+-------+------------+------------+------------+
| | | | | |
+----------------------------+-------+------------+------------+------------+
| Dilutive effect of share | | - | - | - |
| options | | | | |
+----------------------------+-------+------------+------------+------------+
| | | _________ | _________ | _________ |
+----------------------------+-------+------------+------------+------------+
| | | 11,499,294 | 11,499,294 | 11,499,294 |
+----------------------------+-------+------------+------------+------------+
| | | _________ | _________ | _________ |
+----------------------------+-------+------------+------------+------------+
| | | | | |
+----------------------------+-------+------------+------------+------------+
| Earnings per ordinary | | | | |
| share | | | | |
+----------------------------+-------+------------+------------+------------+
| | | | | |
+----------------------------+-------+------------+------------+------------+
| Adjusted | | 6.1p | 0.9p | 4.6p |
+----------------------------+-------+------------+------------+------------+
| Basic | | 5.9p | (8.3)p | (8.9)p |
+----------------------------+-------+------------+------------+------------+
| Diluted | | 5.9p | (8.3)p | (8.9)p |
+----------------------------+-------+------------+------------+------------+
| | | | | |
+----------------------------+-------+------------+------------+------------+
7. This statement is being sent to the shareholders of the Company and will
be available at the Company's registered
office at No 1 Whitehall
Riverside, Leeds, LS1 4BN.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR DGGZLKRNGLZM
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