TIDMTYMN
RNS Number : 0219H
Tyman PLC
25 July 2023
TYMAN PLC
RESULTS FOR THE SIX MONTHSED 30 JUNE 2023
Tyman plc (TYMN.L) announces results for the six months ended 30
June 2023.
Summary Group Results
LFL(1)
GBPm unless stated H1 2023 H1 2022 Change vs 2022
---------------------------------- -------- -------- --------- ---------
Revenue 329.9 360.0 -8% -11%
Adjusted operating profit* 38.7 49.3 -22 % -24%
Adjusted operating margin* 11.7% 13.7% -200bps -200bps
Operating profit 27.8 40.8 -32%
Adjusted profit before taxation* 34.2 45.4 -25%
Profit before taxation 22.7 37.4 -39%
Adjusted EPS* 13.3p 17.6p -24%
Basic EPS 8.8p 14.6p -40%
Dividend per share 4.2p 4.2p -
Leverage (2) 1.2x 1.1x +0.1x
Return on capital employed* 11.5% 13.9% -240bps
---------------------------------- -------- -------- --------- ---------
* Alternative performance measures (APMs) provide additional
information to shareholders on the underlying performance of the
business and are used consistently through the statement. Further
details can be found on page 40.
(1) LFL = constant currency like-for-like (see APMs on page 40)
(2) Leverage is calculated in accordance with the debt covenant
methodology (see APMs on page 40)
Highlights:
-- Solid first half performance despite the challenging market
backdrop and against a strong comparative period
-- Expect full year adjusted operating profit at the top end of market expectations
-- Revenue decline reflected significant reduction in volumes
partially offset by the carryover benefit of pricing actions
-- Adjusted operating profit decline primarily reflected
negative operating leverage from significant reduction in
volumes
-- Increase in North America LFL adjusted operating margin of
70bps to 15.0%, with pricing carryover benefits more than
offsetting input cost inflation
-- 100% adjusted operating cash conversion, reflecting a GBP16
million reduction in inventory since the year end
-- Further progress on strategic initiatives, including our sustainability roadmap
-- Completed acquisition of Lawrence Industries shortly after
period end, expanding our market-leading portfolio of hardware for
the North American market; proportion of adjusted operating profits
generated in North America now more than 70% on a proforma
basis
Jason Ashton, Interim Chief Executive Officer, commented : "The
Group has remained focussed on delivering on its financial targets
and strategic priorities in the first half, resulting in a solid
performance despite the challenging market backdrop and against a
strong comparative period. The agility of our teams in managing
cost and reducing inventory, together with the success of the prior
year pricing actions in offsetting cost inflation, has limited the
decline in adjusted operating profit despite a significant
reduction in volumes. The operating margin expansion delivered by
the North America division in the period also represented notable
progress.
We were delighted to announce the acquisition of Lawrence
Industries in early July, which is highly complementary to our
market-leading North American window hardware portfolio and
immediately earnings enhancing, and I am pleased to welcome our new
colleagues at Lawrence Industries to Tyman.
Tyman remains well placed for growth as the North American
housing market backdrop improves and, assuming broadly unchanged
market conditions in the second half, we expect to deliver full
year adjusted operating profit at the top end of market
expectations, with a GBP2 - GBP3 million contribution from Lawrence
Industries being partially offset by adjusting to current exchange
rates*. "
(*) Company compiled analyst consensus of GBP80.8 million, with
a range of GBP77.6 million - GBP84.3 million. Details can be found
at:
https://www.tymanplc.com/investor-relations/analysts-consensus
25 July 2023
Enquiries
Tyman plc 020 7976 8000
Jason Ashton - Interim Chief Executive Officer investor.relations@tymanplc.com
Juliette Lowes - Interim Chief Financial Officer
Matt Jones - Head of Investor Relations
MHP 020 3128 8404
Reg Hoare / Rachel Farrington / Matthew Taylor tyman@mhpgroup.com
Analyst and investor presentation
Tyman will host an analyst and investor presentation at 9.00 a.m. today, Tuesday 25 July 2023,
which will be webcast live at: https://brrmedia.news/TYMN_HY23
Audio conference call details are:
Number +44 (0) 33 0551 0200
Password (if prompted) Quote 'Tyman H1 2023 Results' when prompted
Notes to editors
Tyman (TYMN: LSE) is a leading international supplier of
engineered fenestration components and access solutions to the
construction industry. The company designs and manufactures
products that enhance the comfort, sustainability, security, safety
and aesthetics of residential homes and commercial buildings.
Tyman's portfolio of leading brands serve their markets through
three divisions: Tyman North America, Tyman UK and Ireland and
Tyman International. Headquartered in London, the Group employs
approximately 3,400 people with facilities in 16 countries
worldwide. Further information is available at www.tymanplc.com
.
Overview of results
Performance in H1 2023
Tyman delivered a solid overall performance in the first half of
2023 against a strong comparative period and despite a continuation
of the weak markets experienced in the fourth quarter of 2022.
Revenue for the period declined by 8% to GBP329.9 million (2022:
GBP360.0 million), reflecting a like-for-like (LFL) decline of 11%
partially offset by 3% growth from foreign exchange movements. The
LFL decline reflected the impact of a significant reduction in
volumes due to underlying demand softness and customer destocking,
which more than offset the benefit from the carryover of pricing
actions in recovering input cost inflation.
Residential housebuilding and RMI activity across the Group's
major markets was impacted by the cost of living crisis caused by
the combination of elevated levels of consumer inflation and
interest rates. This contrasts with the first half of 2022, a
period which benefitted from a post-COVID rebound in RMI activity,
some of which was supported by government fiscal stimulus
programmes which are no longer in place. In addition to the
weakness in underlying market demand, volumes were also impacted by
customer destocking. The extent of such destocking is difficult to
quantify, although it is believed that this impact has moderated as
the period progressed.
The Group's results reflect the positive impact of prior year
pricing actions and the strength of the Group's brands that have
enabled pricing power to be maintained. It has also been pleasing
to see the reversal of the pricing lag that negatively impacted
operating margins in North America during 2021 and 2022. Commodity
cost inflation in general eased during the period, although prices
for certain raw materials remain high. In addition, labour markets
have remained competitive, especially in the US, resulting in wage
inflation remaining above long-term averages.
The Group continues to respond to the soft demand backdrop with
adjustments to production shifts, targeted headcount reductions,
reductions in temporary labour, natural labour attrition and tight
control of discretionary costs. These cost actions were not able to
offset a significant under-absorption of fixed costs, with
production volumes declining by more than sales volumes to further
reduce inventory levels, which decreased by GBP21.3 million during
the period. As a result, adjusted operating profit declined by 22%
on a reported basis (reflecting a LFL decline of 24% and a 2%
foreign exchange benefit).
Reflecting the progress on inventory reduction, adjusted
operating cash conversion improved to 100% (2022: 34%).
An interim dividend of 4.2 pence per share will be paid on 8
September 2023 to shareholders on the register at close of business
on 4 August 2023.
Health and safety
The health and safety of Tyman's employees remains the Group's
top priority, with progress in our safety excellence programme
being primarily measured by the lost time incident frequency rate
(LTIFR). This was 0.9 incidents per million hours worked in the
period, a 25% improvement compared to the prior year, giving
confidence that we can meet our ambitious goal of reducing the
LTIFR to less than one by the end of the year.
Strategic progress
The Group continued to progress its Focus, Define, Grow
strategy, all of which is underpinned by sustainability.
Within the Focus strategic pillar, the project to consolidate
two manufacturing sites into one in Owatonna, US has begun. The
multi-year programme to roll-out a new ERP template across North
America continued, with a further two sites successfully going live
in March. This programme will enable enhanced customer service
levels, greater efficiencies, and improved decision-making. The
European seals manufacturing optimisation programme was completed
with the transfer of production lines from Germany to the Newton
Aycliffe facility in the UK, and the consolidation of the UK
commercial access solutions business into a single site was also
completed.
During the period the Science Based Targets initiative validated
the Group's targets to reduce absolute scope 1 and scope 2 GHG
emissions by 46.2% by 2030 from a 2019 base year and reduce
absolute scope 3 GHG emissions from purchased goods and services by
27.5% within the same timeframe. 100% renewable electricity tariffs
will soon be extended to two sites in Mexico. Once in place, around
38% of the Group's electricity consumption will be derived from
certified 100% renewable electricity, addressing over a quarter of
the Group's scope 1 and 2 operational footprint.
Within the Define strategic pillar, leaders from across the
Group met with Tyman's major Chinese suppliers in June as part of
the ongoing Procurement Excellence initiative. After several
challenging COVID years, this event was welcomed by suppliers to be
able to meet with divisional Presidents and allowed all three
divisions to engage with suppliers on many topics, including
quality, cost, lead times and sustainability.
Activities to Grow market share continue to yield positive
results. In North America, further net customer wins were achieved
despite the challenging market backdrop , whilst the new
distribution centre in Arizona is enabling greater market
penetration in the western US. In International markets, further
progress was made in growing partnerships with system houses,
whilst there has been good success with recent new product launches
in the UK and share gains with distributors in this market.
Enabling customers to innovate through sustainability is a key
differentiator for the Group. In March, a conference was held with
our Iberian system house partners to discuss this topic in more
detail, including how to increase the recycled aluminium content in
products, and the Group's CHIC concealed hinges for tilt-and-turn
windows and Fulcra door hinges have now achieved Environmental
Product Declarations (EPD) certification.
As announced on 12 July 2023, Tyman acquired US-based Lawrence
Industries shortly after the period end for an initial
consideration of $57 million . Lawrence Industries designs,
manufactures and sells high-performance composite window hardware
in North America, and adds an exciting new product category to
Tyman's market-leading portfolio of window and door hardware for
the attractive North American market. Being a low-cost product
category, composite hardware is benefitting from the growing demand
for affordable housing in the US. The acquisition is immediately
earnings enhancing and, on a proforma basis, increases the
proportion of adjusted operating profits that Tyman generates in
North America to more than 70%.
Board changes
As announced on 6 April 2023, Jo Hallas decided to step down as
Chief Executive Officer (CEO) and Director of Tyman by mutual
agreement with the Board with immediate effect. Jason Ashton,
previously the Group's Chief Financial Officer (CFO), has been
acting as interim CEO since then and a process to recruit Jo's
successor is underway. As announced on 21 April 2023, Juliette
Lowes, who was previously Group Financial Controller, has assumed
the interim CFO role since that date. Juliette reports to the Board
but is not a statutory Board director.
After more than six years' service as a Non-executive Director,
Helen Clatworthy retired from the Board with effect from 21 July
2023. The Board would like to thank Helen for her significant
contribution to the Group; her leadership, experience and judgement
have been invaluable through a period of considerable change. Dr
Margaret Amos joined the Board as a Non-executive Director with
effect from 19 June 2023. She is a member of each of the
Remuneration and Nominations Committees and, from 21 July 2023, she
has assumed the role of Chair of the Audit & Risk Committee
from Helen Clatworthy.
Outlook
The positive long-term structural growth drivers for the Group
remain intact, including favourable housing market fundamentals,
increasing building regulation and a focus on sustainability. T he
Group remains focussed on taking market share, through executing
well with customers, launching innovative new products, and
expanding its channels to market. Activities to enhance supply
chain and manufacturing efficiency and resilience are expected to
structurally improve gross margin and working capital management.
As a result, the Group is well-placed for growth when the housing
market backdrop improves.
2023 is expected to see a return to more normal seasonality
compared to the trends experienced in recent years. The leading
indicators for our major markets continue to signal a challenging
market outlook in the second half of 2023, although visibility is
limited, and market conditions can change rapidly.
As we move into the second half, the impact of customer
destocking is expected to subside, production levels will normalise
with market demand, and commodity cost inflation is expected to
ease further. Profitability is expected to continue to benefit from
prior year pricing actions, whilst the benefits of previously
announced structural cost-saving initiatives will be realised in
the second half. The agility of our business model and flexibility
in our cost base will enable us to swiftly adapt to any potential
changes in demand. As a result, we expect full year adjusted
operating profit to be at the top end of market expectations, with
a GBP2 - GBP3 million contribution from Lawrence Industries being
partially offset by adjusting to current exchange rates.
Jason Ashton
Interim Chief Executive Officer
Tyman North America
GBPm except where stated H1 2023 H1 2022 Change LFL
--------------------------- -------- -------- ------- -------
Revenue 215.4 229.5 -6% -11%
Adjusted operating profit 32.4 32.6 -1% -6%
Adjusted operating profit
margin 15.0% 14.2% +80bps +70bps
--------------------------- -------- -------- ------- -------
Markets
The US residential housing market has remained subdued
throughout the first half of 2023. While long-term housing demand
fundamentals remain positive, they are currently constrained by
elevated interest rates and inflation. According to the US Census
Bureau, US housing starts declined by 15% in the first half, whilst
single family starts, to which the division has proportionally
higher exposure, declined by 21%. Residential housing permits, a
key leading indicator, declined by 19%, with single family permits
declining by 21%. According to LIRA (Leading Indicator of
Replacement Activity), the rate of growth in the annual spend on
repair and remodelling in the US slowed from 16% in the fourth
quarter of 2022 to 9.5% in the second quarter of 2023. The NAHB
Remodelling Market Index posted readings of 70 and 68 in the first
and second quarter of 2023 respectively, consistent with the level
posted at the end of 2022. Towards the end of the period there were
tentative signs of improvement in the US residential housing
market, but it remains too early to identify this as a positive
trend.
The US commercial market remained resilient in the first half of
2023, driven by education and commercial building investment,
whilst government legislation is providing some stimulus to the
public infrastructure market. In Canada, single detached housing
starts declined by 28% in the period, also impacted by elevated
inflation and interest rates.
Business performance and developments
Reported revenues declined by 6%, reflecting a LFL decrease of
11% offset by the positive impact of foreign exchange. LFL revenues
were impacted by a decline in volumes resulting from the
challenging market backdrop and customer destocking, which more
than offset the benefits from prior year pricing actions and net
customer wins. The rate of volume decline moderated towards the end
of the period.
The division made good progress with its strategic initiatives
aimed at driving share gains, reducing cost and complexity, and
improving operational resilience. Central to this is the
implementation of a new ERP system to enable more streamlined
ordering and logistics processes for customers and provide a more
consistent customer experience, drive further back-office
efficiencies, and improve the business's decision support
capabilities. This multi-year programme is progressing well with
two key sites successfully going live in March and another two
sites planned to go live in late 2023.
The new distribution site in Phoenix to service the western US
market is performing to plan, whilst the consolidation of two
manufacturing sites into one in Owatonna is also progressing to
schedule with product line transfers and process flow improvements
underway and planned capital investment in a new paint line
approved and on order.
During the period the business achieved incremental net customer
wins despite losing some low profitability business through
maintaining a disciplined approach to pricing. These business
losses were more than offset by wins gained from new products, such
as the entry-price point sliding patio door solution, together with
superior customer service levels. Additional new product launches
are expected to drive further incremental net customer wins in the
second half of 2023, including a next generation casement window
solution that incorporates magnetic elements in the handle to
improve its operation, and an entry level casement lock solution
for the Canadian market.
Input cost inflation has, in general, continued to ease during
2023, although certain commodity prices remain high and labour
inflation has continued at historically high levels. The labour
availability and retention challenges experienced in 2022 have
improved, and the resultant workforce stabilisation has helped to
drive a reduction in overtime and enabled a focus on continuous
improvement projects to improve efficiency and supply chain
resiliency and reduce inventory. There remain considerable
opportunities in this area.
The significant decline in volume in the period was the primary
driver of the 6% decline in LFL adjusted operating profit (1%
decrease in adjusted operating profit on a reported basis,
reflecting the impact of foreign exchange). The decline in
production output did, however, enable a reduction in inventory of
$24 million in the period. The natural lag in the recovery of input
cost inflation via pricing actions that impacted the division's
adjusted operating profit and margin in 2021 and 2022 has, as
expected, begun to reverse in 2023, resulting in a normalising
price-cost dynamic in the period. As a result, the division
delivered a LFL adjusted operating margin increase of 70bps to
15.0% despite the lower volumes.
Shortly after the period end Lawrence Industries was acquired.
Lawrence Industries designs, manufactures and sells
high-performance composite hardware for sliding and hung windows to
North American PVC window fabricators. Composite hardware provides
an attractive, high performance, low-cost product option, is a
beneficiary of the growing demand for affordable homes in North
America, and the combination of AmesburyTruth and Lawrence
Industries will provide a strong value proposition for customers.
Lawrence Industries will continue to trade under its own
well-respected brand name.
Outlook
The underlying fundamentals of the US housing market remain
strong, with years of supply lagging demand creating a significant
housing deficit. Nevertheless, short-term constraints on market
demand exist due to the historically high levels of inflation and
interest rates. The NAHB forecasts a 4% decline in private RMI
spending and a 21% decline in single family housing starts in
2023.
Against this backdrop, the division will maintain its focus on
gaining market share, notably in the western US and Canada, and
continue to develop its new product pipeline. The benefits of prior
year pricing actions will help mitigate the adverse impact of lower
volumes, whilst cost inflation should continue to ease during the
second half. Work to streamline the supply chain and return
operational efficiencies across the network to normalised levels
will remain a focus and, along with a GBP2 - GBP3 million
contribution from Lawrence Industries, is expected to result in
further improvements to the division's performance in the second
half.
Tyman UK & Ireland
GBPm except where stated H1 2023 H1 2022 Change LFL
--------------------------- -------- -------- -------- --------
Revenue 51.0 53.7 -5% -5%
Adjusted operating profit 5.8 7.7 -25% -25%
Adjusted operating
margin 11.4% 14.3% -290bps -290bps
--------------------------- -------- -------- -------- --------
Markets
Activity in the UK residential RMI market, to which the division
is predominantly exposed, remained subdued in the first half of
2023, impacted by the pressure on household incomes from elevated
levels of inflation and interest rates that have been a headwind
for the market for more than a year. This negative impact was
amplified by customer destocking following the higher-than-normal
inventory levels that had been built during the post-pandemic
market rebound and associated supply chain challenges. The latest
CPA forecast expects spending in the private RMI market to decline
by 11% in 2023, following a decrease of 4% in 2022.
Whilst the UK construction PMI (CPMI) has posted readings
slightly above the neutral 50 level during most of the first half,
the residential component of the CPMI has been below 50; indeed,
the June 2023 CPMI showed the residential housing component
deteriorating to its lowest level in 14 years, excluding the COVID
period. In contrast, the commercial and civil engineering
components of the CPMI have stayed above 50 and the CPA forecasts
these sectors to be broadly flat in 2023.
Business performance and developments
Revenue decreased by 5% in H1 2023 on a LFL and reported basis.
The benefit of prior year pricing actions was more than offset by a
decline in hardware volumes, reflecting the above-mentioned ongoing
challenges in the residential RMI market. In addition, there was a
fall in revenue in the commercial access solutions business, which
was impacted by supplier delays with its new automation
equipment.
Despite the challenging market conditions, the hardware business
has continued with its strategic initiatives and achieved share
gains in the period, notably with major distributors, where the
strength of the brands and the close customer collaboration
provided by the business are differentiators. The work that has
been taking place over the past 18 months to improve the division's
new product development processes and pipeline is also now starting
to deliver benefits, with revenues from new products in categories
such as friction stays, door closers, handles, cylinders, hinges
and letterplates running ahead of both plan and the prior year
during the first half, despite the tough market backdrop.
Input cost inflation, including that caused by adverse foreign
exchange movements, has continued to create a headwind during the
period, though to a lesser extent than experienced in 2022. Given
this, the hardware business has remained agile with regards to
pricing, with the combination of prior year general price increases
and surcharges largely offsetting raw material inflation and higher
air freight costs in the first half.
As part of the Group's sustainability roadmap, the hardware
business has continued its development of sustainable packaging
solutions and the elimination of hazardous substances from
products. Given the division sources much of its products from
Asia, the achievement of these goals relies on key Chinese
suppliers and formed a major topic of discussion at a recent Tyman
supplier conference in Ningbo to ensure the engagement, alignment
and support of suppliers in producing and delivering sustainable
solutions for customers.
Access 360, the division's commercial access solutions business,
completed the final steps in the consolidation of the three
heritage Access 360 sites (Profab, Howe Green and the Bilco
warehouse) into a single highly automated facility in Wolverhampton
during the period. The business experienced supplier delays with
the new automation equipment and paint line for the facility which
significantly impacted its operational and financial performance in
the first half; these challenges have now been worked through and
the business is set for an improved second half performance.
LFL and reported adjusted operating profit decreased by 25%.
This was primarily attributable to the supplier-related operational
challenges that affected Access 360's performance, as the hardware
business was able to largely offset the negative operating leverage
impact from lower hardware volumes with the benefits from prior
year pricing actions and tight cost control.
Outlook
As highlighted by the latest CPA forecast referenced above, the
UK residential RMI market is expected to remain challenging through
the remainder of 2023. Against this backdrop, the hardware business
will continue to focus on new product development, share gains and
enhancing its supply chain resilience to ensure customer service
levels are maintained, whilst continuing to tightly manage
discretionary costs. The alleviation of the operational challenges
experienced by Access 360 in the first half will further support an
improvement in the division's performance in the second half.
Tyman International
GBPm except where stated H1 2023 H1 2022 Change LFL
--------------------------- -------- -------- -------- --------
Revenue 63.5 76.8 -17% -18%
Adjusted operating profit 5.5 14.0 -61% -60%
Adjusted operating profit
margin 8.7% 18.3% -960bps -900bps
--------------------------- -------- -------- -------- --------
Markets
As expected, the decline in demand levels experienced in the
second half of 2022 across most of the division's key geographies
continued through the first half of 2023. Rising interest rates and
persistently high levels of inflation continue to have a negative
effect on consumer confidence across Europe, which accounts for
approximately 65% of divisional revenue. The Eurozone Construction
PMI remained in a range of 44.2 to 47.6 throughout the first half
of 2023, indicating a construction sector in contraction; within
this, the data for the division's largest market, Italy, was
slightly better than the Eurozone average but remained below the
neutral 50 level during the period.
Elsewhere, there continued to be favourable market conditions in
the Gulf Cooperation Council cluster of markets, but activity
levels remain disappointing in China and Latin America.
Business performance and developments
LFL revenues declined by 18% in the period against an
exceptionally strong comparative. The drivers of this were the
challenging market conditions, exacerbated by customer destocking,
especially in early 2023. These negative volume impacts more than
offset the benefit from the carryover of prior year pricing
actions. Reported revenues declined by 17%, reflecting the impact
of foreign exchange.
The strategic initiative to develop system house partnerships
continued to gain traction during the first half, notably in Europe
and the GCC. This channel now represents 18% of the division's
revenue (compared to 16% for the full year 2022) and is expected to
continue to grow faster than the market in these key geographies,
as they are driving innovation and sustainability in the industry.
Once a supplier is integrated into a system house's customised
solution it provides a stable recurring revenue stream. Tyman is
well placed to grow with this group of customers by working closely
with them to create innovative solutions, with systems deploying
newly developed Giesse hardware and Schlegel seal products starting
to be delivered to the market in 2023.
Sustainability continues to be a key differentiator for Tyman
across Europe, and in May two major product ranges, the CHIC
concealed hinges for tilt and turn windows and Fulcra door hinges,
achieved Environmental Product Declaration (EPD) certification,
creating additional revenue opportunities as EPD certification is a
prerequisite for an increasing number of tenders in the market. In
March, the division hosted a sustainability conference for its
Iberian system house partners to present Tyman's 2030
sustainability roadmap and discuss collaborative efforts for
sustainable solutions in the European aluminium fenestration
market.
Work to optimise the division's seals manufacturing business
following the closure of the German seals manufacturing plant and
the transfer of its production to the Newton Aycliffe facility in
the UK was completed in the first half. This consolidation will
deliver structural improvements to profitability and enhanced
customer service levels. Further process automation has been
implemented at the Budrio hardware manufacturing facility to
enhance safety, capacity and efficiency.
The division's pricing strategy remains agile and responsive to
market conditions, balancing volume and margin, but prior year
pricing actions were insufficient to fully recover input cost
inflation in the period. Combined with the significant decline in
sales and production and the consequential negative effect on fixed
cost absorption, this resulted in a LFL adjusted operating profit
decline of 60%, with the adjusted operating margin decreasing to
8.7%. On a reported basis, adjusted operating profit decreased by
61%, reflecting the impact of foreign exchange.
Outlook
Recent construction PMI data suggests that the market is likely
to remain challenging in the second half of the year, with consumer
confidence in most of the division's key markets continuing to be
impacted by rising interest rates and elevated levels of inflation.
Hence, whilst the division's LFL revenue performance in the second
half should benefit from ongoing share gains, an absence of
customer destocking and easier comparators, no recovery in market
demand is currently anticipated outside of the GCC cluster, which
is expected to maintain its recent growth trends.
Given this, the priorities remain to capture share growth
opportunities through new product launches and channel expansion
activities whilst continuing to tightly manage the cost base. The
division will also continue to take measures to increase the
variable element of its cost base and reduce its operating
leverage, including reviewing its footprin t outside of Europe.
FINANCIAL REVIEW
Income statement
Revenue and profit
Reported revenue in the period decreased by 8.4% to GBP329.9
million (H1 2022: GBP360.0 million) against a very strong
comparator, largely reflecting a decline in volumes of GBP73.8
million, driven by the weaker global macroeconomic conditions which
began to take effect in the second half of 2022, combined with the
impact of customer destocking. The volume shortfall was partially
offset by the benefit of the carryover of prior year price
increases of GBP22.7 million and surcharges of GBP8.8 million to
recover significant input cost inflation experienced across 2021
and 2022, for which there was a lag in recovery. Reported revenue
also benefitted from favourable foreign exchange movements of
GBP12.2 million. On a LFL basis, which excludes the foreign
exchange benefit, revenue decreased 11.4% compared to H1 2022.
Operating profit decreased by 31.9% to GBP27.8 million (H1 2022:
GBP40.8 million). The impact of the drop through of lower sales
volumes was c.GBP23.6 million. Production volumes were down more
than sales volumes in order to reduce inventory levels, and
although significant cost reductions were achieved in response to
lower demand, the net effect on fixed cost absorption and
productivity impacted profitability by c.GBP6.9 million. The
carryover of pricing actions of GBP31.5 million more than offset
in-period material, wages and salary, and other input cost
inflation of GBP11.5 million, with the significant lag experienced
over the last two years now reversed. Operating profit was also
impacted by adverse transactional foreign exchange movements,
adjusting items associated with restructuring and M&A activity,
and benefitted from favourable foreign exchange movements of GBP1.7
million. Adjusted operating profit, which excludes adjusting items
and amortisation of acquired intangibles, decreased by 21.5% to
GBP38.7 million (H1 2022: GBP49.3 million), and on a LFL basis,
excluding the benefit of foreign exchange decreased by 24.1%.
Operating margin decreased by 290 bps to 8.4% (H1 2022: 11.3%)
and adjusted operating profit margin decreased by 200 bps to 11.7%
(H1 2022: 13.7%).
Reported profit before taxation decreased by 39.3% to GBP22.7
million (H1 2022: GBP37.4 million), as a result of the lower
operating profit and an increase in net finance costs of GBP1.7
million. Adjusted profit before tax decreased by 24.6% to GBP34.2
million (H1 2022: GBP45.4 million), as a result of the lower
adjusted operating profit and higher net finance costs. On a LFL
basis, excluding the foreign exchange benefit, this decreased
27.2%.
Materials and input costs
GBPm except where stated FY 2022 Materials (1) Average (2) Spot (3)
-------------------------- ---------------------- ------------ ---------
Aluminium 21.5 -18.5% -23.9%
Polypropylene 45.2 -32.6% -26.7%
Stainless steel 80.2 -0.9% -17.0%
Zinc 33.5 -3.3% -9.8%
Far East components (4) 41.8 -5.3% -11.7%
-------------------------- ---------------------- ------------ ---------
(1) FY 2022 materials cost of sales for raw materials,
components and hardware for overall category. Only major materials
categories are presented
(2) Average H1 2023 tracker price compared with average H1 2022 tracker price
(3) Spot tracker price as at 30 June 2023 compared with spot tracker price at 30 June 2022
(4) Pricing on a representative basket of components sourced
from the Far East by the UK & Ireland division
Both spot and average prices across all major categories
moderated in H1 2023, following significant inflation over the
previous two years. However, as higher priced inventory carried
into the year was still being sold-through, the Group is yet to
realise the benefit of cost reductions. Previously implemented
price increases and surcharges are now recovering the gap
experienced over the last two years as result of the timing lag
driven by the magnitude and frequency of cost increases, as well as
customer pricing mechanisms.
Selling, general and administrative expenses
Selling, general and administrative expenses increased to GBP
79.9 million (H1 2022: GBP75.6 million), driven largely by salary
and other cost inflation, adjusting items associated with
restructuring and M&A activity, and foreign exchange of GBP1.9
million, partially offset by lower amortisation of acquired
intangibles and the effect of cost control measures implemented in
response to weaker demand. Adjusted selling, general and
administrative costs, which exclude the impact of adjusting items
and amortisation of acquired intangibles, increased to GBP69.0
million (H1 2022: GBP67.1 million). On a LFL basis, adjusted
selling, general and administrative expenses were flat against
2022.
Adjusting items
Certain items that are considered to be significant in nature
and / or quantum have been excluded from adjusted measures, such
that the effect of these items on the Group's results can be
understood and to enable an analysis of trends in the Group's
underlying trading performance.
GBPm H1 2023 H1 2022
----------------------------- -------- --------
Redundancy and restructuring (2.5) -
M&A and integration (0.6) -
(3.1) -
----------------------------- -------- --------
The redundancy and restructuring costs comprise costs associated
with the departure of the previous Chief Executive Officer, costs
related to a targeted reduction in workforce in North America, and
the final costs relating to the closure of the Hamburg facility and
consolidation of the three UK access solutions businesses into a
single site that commenced in the second half of 2022 and are now
substantially completed.
The M&A integration costs relate to transaction fees
incurred in the period in respect of the acquisition of Lawrence
Industries, which completed subsequent to the period end.
Finance costs
Net finance costs increased to GBP5.1 million (H1 2022: GBP3.4
million).
Interest payable on bank loans, private placement notes and
overdrafts increased to GBP4.5 million (H1 2022: GBP2.9 million),
reflecting a significantly higher weighted average interest rate,
partially offset by lower average net debt. The weighted average
interest rate increased to 4.6% (H1 2022: 2.8%), with the improved
coupon rates on the new USPP debt issued in April 2022 more than
offset by higher interest rates on the floating RCF debt, due to
the significant increase in global base interest rates.
Interest on lease liabilities of GBP1.3 million was broadly in
line with the previous period (H1 2022: GBP1.2 million). Interest
income from short term bank deposits amounted to GBP1.0 million (H1
2022: GBP0.2 million), reflecting higher interest rates. Finance
costs were also impacted by a loss on revaluation of derivative
instruments of GBP0.3 million (H1 2022: gain of GBP0.7 million),
and amortisation of capitalised borrowing costs of GBP0.3 million
(H1 2022: GBP0.2 million).
Taxation
The Group reported an income tax charge of GBP5.6 million (H1
2022: GBP9.0 million), comprising a current tax charge of GBP7.4
million (H1 2022: GBP11.0 million) and a deferred tax credit of
GBP1.8 million (H1 2022: credit of GBP2.0 million), representing an
effective tax rate of 24.7% (H1 2022: 24.1%). The increase in the
effective tax rate reflects a tax cost associated with the closure
of the facility in Hamburg. The adjusted effective tax rate, which
excludes the tax effect of adjusting items, including the cost
associated with the closure of the Hamburg facility was 24.4% (H1
2022: 24.4%). This is the Group's current best estimate of the
effective tax rate for the 2023 full year.
During the period, the Group paid corporation tax of GBP7.3
million (H1 2022:
GBP10.0 million). This reflects a cash tax rate on adjusted
profit before tax of 21.3% (H1 2022: 22.0%). The decrease is a
result of a refund of tax overpaid for the 2021 tax year received
in H1 2023.
Earnings per share
Basic earnings per share decreased by 39.7% to 8.8 pence (H1
2022: 14.6 pence), and adjusted earnings per share decreased by
24.4% to 13.3 pence (H1 2022: 17.6 pence), largely reflecting the
decrease in profit after tax. There is no material difference
between these calculations and the fully diluted earnings per share
calculations.
Cash generation, funding and liquidity
Cash and cash conversion
GBPm H1 2023 H1 2022
-------------------------------------- -------- --------
Net cash from operating activities 33.9 17.7
Add: Pension contributions 0.1 0.1
Add: Income tax paid 7.3 10.0
Less: Purchases of property, plant
and equipment (5.1) (9.0)
Less: Purchases of intangible assets (2.2) (2.1)
Add: Adjusting item cash costs 4.6 -
-------------------------------------- -------- --------
Adjusted operating cash flow* 38.6 16.7
Less: Pension contributions (0.1) (0.1)
Less: Income tax paid (7.3) (10.0)
Less: Net interest paid (4.6) (3.3)
Less: Adjusting item cash costs (4.6) -
-------------------------------------- -------- --------
Free cash flow* 22.0 3.3
-------------------------------------- -------- --------
* Alternative performance measures, details of which can be found on page 40.
Net cash from operating activities increased to GBP33.9 million
(H1 2022: GBP17.7 million), largely reflecting a significantly
lower working capital outflow of GBP2.6 million in H1 2023,
compared to GBP32.3 million in H1 2022, as a result of actions
taken to reduce inventory in the period, following a significant
build in H1 2022 to service demand following a period of supply
chain disruption. This was partially offset by lower profit before
tax and cash outflows on provisions made in 2022 associated with
restructuring activities. Adjusted operating cash flow in the
period increased to GBP38.6 million (H1 2022: GBP16.7 million),
reflecting the higher net cash from operating activities and lower
capital expenditure. Adjusted operating cash conversion in H1 2023
was much higher than normalised H1 levels at 99.8% (H1 2022:
33.8%), reflecting the lower working capital outflow.
Free cash flow in the period was GBP22.0 million, compared to
GBP3.3 million in H1 2022, as a result of a significantly higher
adjusted operating cash flow and lower income tax payments on
account, offset slightly by higher net interest paid.
Debt facilities
Bank and US private placement facilities available to the Group,
as at 30 June 2023, were as follows:
Facility Maturity Currency Committed Uncommitted
-------------- ----------- -------------- ---------- ------------
2022 Facility Dec 2026 Multicurrency GBP210.0m GBP100.0m
5.37 % USPP Nov 2024 US$ US$45.0m -
3.51 % USPP April 2029 US$ US$40.0m -
3.62 % USPP April 2032 US$ US$35.0m -
-------------- ----------- -------------- ---------- ------------
There have been no changes to the multi-currency revolving
credit facility and US private placement notes during the period,
details of which are outlined in the Annual Report and Accounts for
the year ended 31 December 2022.
There were no defaults in the period under the terms of loan
agreements.
Both the USPP notes and the RCF incorporate sustainability
performance targets which align with Tyman's sustainability roadmap
as outlined in the Annual Report and Accounts for the year ended 31
December 2022. These incentive mechanisms result in a modest
reduction or increase in the interest rate depending on performance
against these targets.
Liquidity
At 30 June 2023, the Group had gross debt of GBP246.4 million
(H1 2022: GBP268.7 million) and net debt of GBP167.8 million (H1
2022: GBP182.0 million). Adjusted net debt, which excludes lease
liabilities and capitalised borrowing costs was GBP112.7 million
(H1 2022: GBP125.7 million), with the decrease reflecting operating
cash generation, including the lower working capital, as well as
benefitting from foreign exchange movements.
The Group had cash balances of GBP78.6 million (H1 2022: GBP86.7
million), bank overdrafts of GBP27.8 million (H1 2022: GBP23.4
million) and committed but undrawn facilities of GBP132.3 million
(H1 2022: GBP140.5 million). This provides immediately available
liquidity of GBP183.1 million (H1 2022: GBP203.8 million). The
Group also has potential access to the uncommitted GBP100.0 million
accordion facility.
Covenant performance
Performance Headroom Headroom
At 30 June 2023 Test (1) (2) (2)
----------------- -------- ------------ --------- ---------
Leverage < 3.0x 1.2x GBP58.3m 60%
Interest Cover > 4.0x 14.6x GBP70.2m 73%
----------------- -------- ------------ --------- ---------
(1) Calculated covenant performance consistent with the Group's
banking covenant test (banking covenants exclude impact of IFRS
16). See APMs on page 44 for interest cover and page 46 for
leverage.
(2) The approximate amount by which adjusted EBITDA would need
to decline before the relevant covenant is breached.
At the half year, the Group retained significant headroom on its
banking covenants. Leverage at the period end was 1.2x (H1 2022:
1.1x), reflecting the lower covenant EBITDA, which is measured on
an LTM basis. Interest cover at the period end was 14.6x (H1 2022:
19.3x), largely reflecting the higher interest expense as well as
the lower covenant EBITDA.
Balance sheet - assets and liabilities
Working capital
GBPm FY 2022 Mvt FX H1 2023
----------------------- -------- ------- ------ --------
Inventories 153.1 (16.1) (5.2) 131.8
Trade receivables 67.5 19.8 (2.6) 84.7
Trade payables (55.8) 1.4 1.7 (52.7)
----------------------- -------- ------- ------ --------
Trade working capital 164.8 5.1 (6.1) 163.8
----------------------- -------- ------- ------ --------
Trade working capital at the half year, net of working capital
provisions, was GBP163.8 million (H1 2022: GBP170.3 million; FY
2022: GBP164.8 million). The trade working capital build to the
half year at average exchange rates was GBP5.1 million (H1 2022:
GBP30.3 million).
The decrease in inventory at average exchange rates was GBP16.1
million (H1 2022: increase of GBP20.9 million). This was driven by
initiatives implemented to bring inventory down to more normalised
levels, following a build driven by supply chain disruption through
2022. Trade receivables increased in the period due to the seasonal
increase in trading activity and the effect of carryover pricing,
and trade payables decreased as a result of lower inventory
purchasing.
Trade working capital decreased by GBP6.1 million due to foreign
exchange movements.
Capital expenditure
Gross capital expenditure decreased to GBP7.3 million (H1 2022:
GBP11.1 million) or 1.0x depreciation (H1 2022: 1.7x), due to H1
2022 having higher capital investment as a result of a catch up of
expenditure deferred from prior years. Capital expenditure for the
full year is now expected to be in the range of GBP17 - GBP22
million.
Balance sheet - equity
Shares in issue
At 30 June 2023, the total number of shares in issue was 196.8
million (H1 2022: 196.8 million) of which 0.5 million shares were
held in treasury (H1 2022: 0.5 million).
Employee Benefit Trust purchases
At 30 June 2023, the EBT held 2.0 million shares (H1 2022: 1.7
million). During the period, the EBT purchased 0.2 million shares
in Tyman plc at a total cost of GBP0.5 million (H1 2022: 2.0
million shares at a total cost of GBP6.6 million).
Dividends
An interim dividend of 4.2p per share (H1 2022: 4.2p) has been
declared. The ex-dividend date will be 3 August 2023 and the final
dividend will be paid on 8 September 2023 to shareholders on the
register at close of business on 4 August 2023.
Only dividends paid in the year have been charged against equity
in the H1 2023 financial statements. Dividend payments of GBP18.5
million were paid to shareholders during H1 2023 (H1 2022: GBP17.2
million).
Other financial matters
Return on capital employed (ROCE)
ROCE decreased by 240 bps to 11.5% (H1 2022: 13.9%) as a result
of the lower adjusted operating profit, higher average working
capital, and the impact of foreign exchange movements on capital
employed, offset by a reduction in the carrying value of intangible
assets through amortisation.
Currency
The principal foreign currencies that impact the Group's results
are the US dollar and the Euro. In H1 2023, Sterling was weaker
against both the US dollar and the Euro when compared with the
average exchange rates in H1 2022.
Translational exposure
Currency US$ Euro Other Total
---------------------------- -------- ------- ------ --------
% movement in average rate (5.1%) (3.9%) -
GBPm Revenue impact (1) 10.8 1.6 (2.0) 10.4
GBPm Profit impact (1)(2) 1.5 0.2 (0.3) 1.4
1c decrease impact (3) GBP195k GBP31k GBP6k GBP232k
---------------------------- -------- ------- ------ --------
(1) Calculated based on H1 2023 financial information
(2) Adjusted operating profit impact
(3) Defined as the approximate favourable translation impact of
a 1c decrease in the Sterling exchange rate of the respective
currency on the Group's adjusted operating profit
The net effect of currency translation caused revenue and
adjusted operating profit from ongoing operations to increase by
GBP10.4 million and GBP1.4 million respectively if current period
results are translated at H1 2022 exchange rates.
Transactional exposure
Divisions that purchase or sell products in currencies other
than their functional currency will potentially incur transactional
exposures. For purchases by the UK & Ireland division from the
Far East, these exposures are principally Sterling against the US
dollar or Chinese renminbi.
The Group's policy is to recover adverse transactional currency
movements through price increases or surcharges. Divisions
typically buy currency forward to cover expected future purchases
for up to six months. The objective is to achieve an element of
certainty in the cost of landed goods and to allow sufficient time
for any necessary price changes to be implemented.
The Group recognised a loss on foreign exchange derivatives in
H1 2023 of GBP0.3 million (H1 2022: gain of GBP0.7 million). The
Group's other transactional exposures generally benefit from the
existence of natural hedges and are immaterial.
Principal risks and uncertainties
The Board has reviewed the Group's principal risks and concluded
these remain consistent with those disclosed in the Annual Report
and Accounts for the year ended 31 December 2022. As part of this
review, the Board has considered the impact of the uncertain
macro-economic environment and the impact of geo-political
circumstances, including the ongoing effects of the war in
Ukraine.
Juliette Lowes
Interim Chief Financial Officer
Tyman plc
Condensed consolidated income statement
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2023 (unaudited) 2022 (unaudited) 2022 (audited)
Note GBPm GBPm GBPm
------------------------------------- ----- ------------------ ------------------ ----------------
Revenue 3 329.9 360.0 715.5
Cost of sales (222.0) (243.6) (493.2)
------------------------------------- ----- ------------------ ------------------ ----------------
Gross profit 107.9 116.4 222.3
Selling, general and administrative
expenses (79.9) (75.6) (151.2)
Net impairment losses on financial
assets (0.2) - (0.4)
------------------------------------- ----- ------------------ ------------------ ----------------
Operating profit 27.8 40.8 70.7
Analysed as:
------------------------------------- ----- ------------------ ------------------ ----------------
Adjusted(1) operating profit 3 38.7 49.3 94.6
Adjusting items 4 (3.1) - (6.3)
Amortisation of acquired intangible
assets 8 (7.8) (8.5) (17.6)
Operating profit 27.8 40.8 70.7
Finance income 1.0 0.9 1.0
Finance costs (6.1) (4.3) (10.3)
------------------------------------- ----- ------------------ ------------------ ----------------
Net finance costs (5.1) (3.4) (9.3)
------------------------------------- ----- ------------------ ------------------ ----------------
Profit before taxation 22.7 37.4 61.4
Income tax charge 5 (5.6) (9.0) (13.6)
Profit for the period attributable
to shareholders of the Company 17.1 28.4 47.8
------------------------------------- ----- ------------------ ------------------ ----------------
Basic earnings per share 6 8.8p 14.6p 24.6p
Diluted earnings per share 6 8.7p 14.5p 24.5p
------------------------------------- ----- ------------------ ------------------ ----------------
Non-GAAP alternative performance
measures(1)
Adjusted(1) operating profit 38.7 49.3 94.6
------------------------------------- ----- ------------------ ------------------ ----------------
Adjusted(1) profit before taxation 34.2 45.4 85.8
------------------------------------- ----- ------------------ ------------------ ----------------
Basic adjusted(1) earnings
per share 13.3p 17.6p 34.7p
------------------------------------- ----- ----------------
Diluted adjusted(1) earnings
per share 13.2p 17.6p 34.5p
------------------------------------- ----- ------------------ ------------------ ----------------
(1) See definitions and reconciliations on pages 40 to 50 for
non-GAAP Alternative Performance Measures.
Tyman plc
Condensed consolidated statement of comprehensive income
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2023 (unaudited) 2022 (unaudited)(1) 2022 (audited)
GBPm GBPm GBPm
------------------------------------------- ------------------ --------------------- ----------------
Profit for the period 17.1 28.4 47.8
------------------------------------------- ------------------ --------------------- ----------------
Other comprehensive (expense)/
income
Items that will not be reclassified
to profit or loss
Remeasurements of post-employment
benefit obligations (0.7) 0.1 -
Total items that will not be reclassified
to profit or loss (0.7) 0.1 -
------------------------------------------- ------------------ --------------------- ----------------
Items that may be reclassified
subsequently to profit or loss
Exchange differences on translation
of foreign operations (1) (25.3) 51.9 54.1
Change in fair value of net investment
hedge(1) 5.3 (10.1) (11.7)
Effective portion of changes in
value of fair value hedges (0.2) - 0.2
Total items that may be reclassified
to profit or loss (20.2) 41.8 42.6
------------------------------------------- ------------------ --------------------- ----------------
Other comprehensive (expense)/income
for the period (20.9) 41.9 42.6
------------------------------------------- ------------------ --------------------- ----------------
Total comprehensive (expense)/income
for the period attributable to
shareholders of the Company (3.8) 70.3 90.4
------------------------------------------- ------------------ --------------------- ----------------
(1) Comparatives have been represented for the six months ended
30 June 2022 to show separately the change in fair value of net
investment hedge for consistency with current year presentation.
Items in the statement above are disclosed net of tax.
Tyman plc
Condensed consolidated statement of changes in equity
Share Treasury Hedging Translation Retained Total
capital reserve reserve reserve earnings equity
GBPm GBPm GBPm GBPm GBPm GBPm
-------------------------------------- --------- --------- --------- ------------ ---------- --------
At 1 January 2022 (audited) 9.8 (2.6) - 49.2 426.0 482.4
Profit for the period - - - - 28.4 28.4
Other comprehensive income - - - 41.8 0.1 41.9
-------------------------------------- --------- --------- --------- ------------ ---------- --------
Total comprehensive income - - - 41.8 28.5 70.3
Transactions with owners
as their capacity as owners
Share-based payments(1) - - - - 1.0 1.0
Dividends paid - - - - (17.2) (17.2)
Issue of own shares from
Employee Benefit Trust - 0.5 - - (0.5) -
Purchase of own shares
for EBT - (6.6) - - - (6.6)
-------------------------------------- --------- --------- --------- ------------ ---------- --------
Total transactions with
owners - (6.1) - - (16.7) (22.8)
-------------------------------------- --------- --------- --------- ------------ ---------- --------
At 30 June 2022 (unaudited) 9.8 (8.7) - 91.0 437.8 529.9
Profit for the period - - - - 19.4 19.4
Other comprehensive income/(expense) - - 0.2 0.6 (0.1) 0.7
-------------------------------------- --------- --------- --------- ------------ ---------- --------
Total comprehensive income - - 0.2 0.6 19.3 20.1
Transactions with owners
as their capacity as owners
Share-based payments(1) - - - - (0.2) (0.2)
Dividends paid - - - - (8.2) (8.2)
Total transactions with
owners - - - - (8.4) (8.4)
-------------------------------------- --------- --------- --------- ------------ ---------- --------
At 31 December 2022 (audited) 9.8 (8.7) 0.2 91.6 448.7 541.6
Profit for the period - - - - 17.1 17.1
Other comprehensive (expense)/income - - (0.2) (20.0) (0.7) (20.9)
-------------------------------------- --------- --------- --------- ------------ ---------- --------
Total comprehensive (expense)/
income - - (0.2) (20.0) 16.4 (3.8)
Transactions with owners
as their capacity as owners
Share-based payments(1) - - - - 0.6 0.6
Dividends paid - - - - (18.5) (18.5)
Issue of own shares from
EBT - 2.1 - - (2.1) -
Purchase of own shares
for EBT - (0.5) - - - (0.5)
-------------------------------------- --------- --------- --------- ------------ ---------- --------
Total transactions with
owners - 1.6 - - (20.0) (18.4)
-------------------------------------- --------- --------- --------- ------------ ---------- --------
At 30 June 2023 (unaudited) 9.8 (7.1) - 71.6 445.1 519.4
-------------------------------------- --------- --------- --------- ------------ ---------- --------
(1) Share-based payments include a tax charge of GBPNil (six
months ended 30 June 2022: GBPNil; year ended 31 December 2022: tax
charge of GBP0.2 million) and a credit due to issuance of shares
under the deferred share bonus plan of GBP 0.1 million (six months
ended 30 June 2022: GBPNil; year ended 31 December 2022: tax credit
of GBP0.2 million
Tyman plc
Condensed consolidated balance sheet
30 June
2022
Restated(1)
30 June 31 December
2023 (unaudited) (unaudited) 2022 (audited)
Note GBPm GBPm GBPm
----------------------------------- ----- ------------------ -------------- ----------------
Assets
Non-current assets
Goodwill 7 383.8 397.8 399.3
Intangible assets 8 48.9 64.7 57.7
Property, plant and equipment 9 71.1 71.3 74.6
Right of use assets 53.4 53.2 57.3
Financial assets at fair value
through profit or loss 13 1.2 1.2 1.2
Derivative financial instruments 13 - 0.3 0.2
Deferred tax assets 1.5 4.4 1.7
----------------------------------- ----- ------------------ -------------- ----------------
559.9 592.9 592.0
Current assets
Inventories 131.8 169.9 153.1
Trade and other receivables 99.3 107.7 81.4
Cash and cash equivalents 14 78.6 86.7 74.6
----------------------------------- ----- ------------------ --------------
309.7 364.3 309.1
----------------------------------- ----- ------------------ -------------- ----------------
TOTAL ASSETS 869.6 957.2 901.1
----------------------------------- ----- ------------------ -------------- ----------------
Liabilities
Current liabilities
Trade and other payables (87.5) (130.3) (88.2)
Derivative financial instruments 13 (0.5) - (0.2)
Borrowings 10 (27.2) (23.4) (15.9)
Lease liabilities (6.7) (6.4) (6.8)
Current tax liabilities (1.7) (6.9) (1.8)
Provisions (1.0) (1.2) (5.0)
----------------------------------- ----- ------------------ -------------- ----------------
(124.6) (168.2) (117.9)
Non-current liabilities
Borrowings 10 (162.0) (188.4) (172.5)
Lease liabilities (50.5) (50.5) (54.9)
Deferred tax liabilities (4.7) (11.1) (6.9)
Retirement benefit obligations (4.9) (4.1) (4.3)
Provisions (3.5) (4.8) (2.9)
Other payables - (0.2) (0.1)
----------------------------------- ----- ------------------ -------------- ----------------
(225.6) (259.1) (241.6)
----------------
Total liabilities (350.2) (427.3) (359.5)
----------------------------------- ----- ------------------ -------------- ----------------
Net assets 519.4 529.9 541.6
----------------------------------- ----- ------------------ -------------- ----------------
Equity
Capital and reserves attributable
to owners of the Company
Share capital 11 9.8 9.8 9.8
Treasury reserve (7.1) (8.7) (8.7)
Hedging reserve - - 0.2
Translation reserve 71.6 91.0 91.6
Retained earnings 445.1 437.8 448.7
----------------
Total Equity 519.4 529.9 541.6
----------------------------------- ----- ------------------ -------------- ----------------
(1) See note 2.2 for details regarding reclassification
adjustment to the comparative balance sheet as at 30 June 2023.
Tyman plc
Condensed consolidated cash flow statement
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2023 (unaudited) 2022 (unaudited) 2022 (audited)
Note GBPm GBPm GBPm
-------------------------------------- ----- ------------------ ------------------ ----------------
Cash flow from operating activities
Profit before taxation 3 22.7 37.4 61.4
Adjustments 14 24.1 22.7 53.0
Changes in working capital:
Inventories 16.1 (20.9) (4.8)
Trade and other receivables (20.8) (20.4) 5.6
Trade and other payables 2.1 9.0 (32.2)
Provisions utilised (2.9) - (0.7)
Pension contributions (0.1) (0.1) (0.2)
Income tax paid (7.3) (10.0) (21.5)
Net cash from operating activities 33.9 17.7 60.6
-------------------------------------- ----- ------------------ ------------------ ----------------
Cash flow from investing activities
Purchases of property, plant
and equipment 9 (5.1) (9.0) (19.2)
Purchases of intangible assets 8 (2.2) (2.1) (4.9)
Proceeds on disposal of property,
plant and equipment - - 0.1
Interest received 1.1 0.1 0.9
Net cash used in investing
activities (6.2) (11.0) (23.1)
-------------------------------------- ----- ------------------ ------------------ ----------------
Cash flow from financing activities
Interest paid (5.7) (3.4) (9.5)
Dividends paid (18.5) (17.2) (25.4)
Purchase of own shares for Employee
Benefit Trust (0.4) (6.6) (6.6)
Refinancing costs paid (0.2) (0.2) (2.1)
Proceeds from drawdown of borrowings 22.5 82.3 122.3
Repayments of borrowings (26.6) (56.3) (113.0)
Principal element of lease payments (3.6) (3.3) (6.2)
Net cash used in financing
activities (32.5) (4.7) (40.5)
-------------------------------------- ----- ------------------ ------------------ ----------------
Net (decrease)/increase in
cash and cash equivalents and
bank overdrafts (4.8) 2.0 (3.0)
Exchange (loss)/gain on cash
and cash equivalents and bank
overdrafts (2.6) 3.2 3.1
Cash and cash equivalents and
bank overdrafts at beginning
of period 58.2 58.1 58.1
Cash and cash equivalents and
bank overdrafts at the end of
period 14 50.8 63.3 58.2
-------------------------------------- ----- ------------------ ------------------ ----------------
Tyman plc
Notes to the condensed consolidated financial statements
1. General information
Tyman plc is a leading international supplier of engineered
fenestration components and access solutions to the construction
industry. The Group designs and manufactures products that enhance
the comfort, sustainability, security, safety and aesthetics of
residential homes and commercial buildings. Tyman serves its
markets through three divisions. Headquartered in London, the Group
employs approximately 3,400 people with facilities in 16 countries
worldwide.
Tyman is a public limited company listed on the London Stock
Exchange, incorporated and domiciled in the United Kingdom. The
address of the Company's registered office is 29 Queen Anne's Gate,
London, SW1H 9BU.
These interim financial statements were approved for issue on 24
July 2023 and have been reviewed, not audited, by Deloitte, the
Group's auditors.
These interim financial statements do not comprise statutory
accounts within the meaning of Section 434 of the Companies Act
2006. Statutory accounts for the year ended 31 December 2022 were
approved by the Board of Directors on 2 March 2023 and delivered to
the Registrar of Companies. The report of the auditors on those
accounts was unqualified, did not contain an emphasis of matter
paragraph and did not contain any statement under Section 498 of
the Companies Act 2006.
The financial information for the year ended 31 December 2022 is
extracted from the Group's consolidated financial statements for
that year.
2. Accounting policies and basis of preparation
2.1 Basis of preparation
The condensed consolidated interim financial statements for the
half-year reporting period ended 30 June 2023 have been prepared in
accordance with the UK-adopted International Accounting Standard
34, 'Interim Financial Reporting' and the Disclosure guidance and
Transparency Rules sourcebook of the United Kingdom's Financial
Conduct Authority. The interim report does not include all of the
notes of the type normally included in an annual financial report.
Accordingly, this report should be read in conjunction with the
annual financial statements for the year ended 31 December 2022,
which has been prepared in accordance with UK-adopted international
accounting standards and with the requirements of the Companies Act
2006, and any public announcements made by Tyman plc during the
interim reporting period.
2.2 Changes in accounting policies and disclosures
2.2.1 New accounting standards effective in period
The accounting standards that became applicable in the period
did not impact the Group's accounting policies and did not require
retrospective adjustments.
2.2.2 New, revised and amended accounting standards not yet
effective
None of the standards which have been issued by the Financial
Reporting Council but are not yet effective are expected to have a
material impact on the Group.
2.2.3 Prior year restatement
As disclosed in the 2022 Annual Report and Accounts, following a
letter received from the Financial Reporting Council ("FRC") as
part of its regular review and assessment of the quality of
corporate reporting in the UK, the Group restated the
classification of two areas of the 2021 comparative balance sheet.
One of these areas, relating to the offsetting of deferred tax
assets and liabilities also affected the balance sheet as at 30
June 2022, and therefore the reclassification adjustment has been
applied to the interim comparative balance sheet.
The Group previously presented deferred tax assets and
liabilities gross on the balance sheet. Certain of these assets and
liabilities arose in the same tax jurisdiction and met the criteria
for offset in IAS 12. These balances have therefore been restated
to offset those that met the criteria. The effect of this was to
reduce deferred tax assets and deferred tax liabilities as at 30
June 2022 by GBP8.6 million.
This restatement did not affect the Group's income statement,
net assets, cash flows, KPIs or compliance with covenants.
The previously reported and restated financial statement line
items are summarised as follows:
30 June 2022
As previously Impact of
reported restatement Restated
GBPm GBPm GBPm
------------------------ --- ---------------- --------------- -----------
Deferred tax asset 13.0 (8.6) 4.4
Deferred tax liability (19.7) 8.6 (11.1)
Net assets 529.9 - 529.9
----------------------------- ---------------- --------------- -----------
Total assets 965.8 (8.6) 957.2
----------------------------- ---------------- --------------- -----------
Total liabilities (435.9) 8.6 (427.3)
----------------------------- ---------------- --------------- -----------
2.3 Going concern
The Group's business activities, financial performance and
position, together with factors likely to affect its future
development and performance are described in the overview of
results on pages 3 to 5. There have been no changes to the Group
principal risks and uncertainties from those outlined in the annual
report for the year ended 31 December 2022.
As at 30 June 2023, the Group had net cash and cash equivalents
of GBP50.8 million and an undrawn RCF available of GBP132.3
million, giving liquidity headroom of GBP183.1 million. The Group
also has potential access to an uncommitted accordion facility of
GBP100 million.
The Group is subject to leverage and interest cover covenants
tested in June and December and had significant headroom on both
covenants at 30 June 2023. The Group has GBP58.3 million of EBITDA
headroom on the leverage covenant (60%) and GBP70.2 million on the
interest cover covenant (73%).
The Group has performed an assessment of going concern through
reviewing covenant compliance and liquidity headroom based on
latest forecasts, which show the Group would retain significant
headroom throughout the going concern period.
Having considered the financial performance and position for the
period ended 30 June 2023, current trading, the latest forecast
financial information, and the Group's principal risks, the
Directors are satisfied that the Group has sufficient resources to
continue in operation for the foreseeable future, a period of not
less than 12 months from the date of this report. Accordingly, the
consolidated financial information has been prepared on a going
concern basis.
2.4 Accounting policies
The accounting policies adopted are consistent with those of the
previous financial year and corresponding interim reporting period.
Taxes on income in the interim periods are accrued using tax rates
that would be applicable to expected total annual profit or
loss.
2.5 Accounting judgements and estimates
The preparation of financial statements requires management to
exercise judgement in applying the Group's accounting policies. It
also requires the use of certain critical accounting estimates and
assumptions that affect the reported amounts of assets,
liabilities, income and expenses. Actual amounts may differ from
these estimates.
In preparing these interim financial statements, the significant
judgements made by management in applying the Group's accounting
policies and the key sources of estimation uncertainty were the
same as those applied to the consolidated financial statements for
the year ended 31 December 2022.
3. Segment reporting
3.1 Segment information
The reporting segments reflect the manner in which performance
is evaluated and resources are allocated. The Group operates
through three clearly defined divisions: Tyman North America, Tyman
UK & Ireland and Tyman International.
North America comprises all the Group's operations within the
US, Canada and Mexico. UK & Ireland comprises the Group's UK
& Ireland business and Tyman's Asia sourcing operation.
International comprises the Group's remaining businesses outside
the US, Canada, Mexico and the UK (although includes the two UK
seal manufacturing plants that are managed by the Tyman
International leadership team). Centrally incurred functional costs
that are directly attributable to a division are allocated or
recharged to the division. All other centrally incurred costs and
eliminations are disclosed as a separate line item in the segment
analysis.
In the opinion of the Board, there is no material difference
between the Group's operating segments and segments based on
geographical splits. Accordingly, the Board does not consider
geographically defined segments to be reportable.
The following tables present revenue and profit information for
the Group's reporting segments, which have been generated using the
Group's accounting policies, with no differences of measurement
applied.
3.2 Revenue
Six months ended Six months ended
30 June 2023 (unaudited) 30 June 2022 (unaudited)
GBPm GBPm
--------------- ------------------------------------------ ------------------------------------------
Segment Inter-segment External Segment Inter-segment External
revenue revenue revenue revenue revenue revenue
--------------- --------- ------------------- ---------- ----------- -------------- -------------
North America 216.5 (1.1) 215.4 230.8 (1.3) 229.5
UK & Ireland 51.1 (0.1) 51.0 53.8 (0.1) 53.7
International 64.5 (1.0) 63.5 78.2 (1.4) 76.8
Total revenue 332.1 (2.2) 329.9 362.8 (2.8) 360.0
--------------- --------- ------------------- ---------- ----------- -------------- -------------
Year ended
31 December 2022 (audited)
GBPm
--------------- -----------------------------------------------
Segment Inter-segment External
revenue revenue revenue
--------------- --------------- -------------- ---------
North America 474.9 (3.0) 471.9
UK & Ireland 103.5 (0.2) 103.3
International 143.4 (3.1) 140.3
Total revenue 721.8 (6.3) 715.5
--------------- --------------- -------------- ---------
Included within the International segment is revenue generated
from the UK seals plants of GBP13.0 million (six months ended 30
June 2022: GBP13.2 million; year ended 31 December 2022: GBP24.7
million).
3.3 Profit before taxation
Six months Six months
ended ended Year ended
30 June 2023 30 June 31 December
(unaudited) 2022 (unaudited) 2022 (audited)
Note GBPm GBPm GBPm
--------------------------- ----- -------------- ------------------ ----------------
North America 32.4 32.6 66.8
UK & Ireland 5.8 7.7 14.5
International 5.5 14.0 21.3
--------------------------- ----- -------------- ------------------ ----------------
Operating segment result 43.7 54.3 102.6
Centrally incurred costs (5.0) (5.0) (8.0)
--------------------------- ----- -------------- ------------------ ----------------
Adjusted operating profit 38.7 49.3 94.6
Adjusting items 4 (3.1) - (6.3)
Amortisation of acquired
intangible assets 8 (7.8) (8.5) (17.6)
Operating profit 27.8 40.8 70.7
Net finance costs (5.1) (3.4) (9.3)
Profit before taxation 22.7 37.4 61.4
--------------------------- ----- -------------- ------------------ ----------------
4. Adjusting items
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2023 (unaudited) 2022 (unaudited) 2022 (audited)
GBPm GBPm GBPm
------------------------------ ------------------ ------------------ ----------------
Redundancy and restructuring
costs (2.5) - (6.3)
M&A and integration costs (0.6) - -
Total Adjusting items (3.1) - (6.3)
------------------------------ ------------------ ------------------ ----------------
The redundancy and restructuring costs comprise costs associated
with the departure of the previous Chief Executive Officer, costs
related to a targeted reduction in workforce in North America, and
the final costs relating to the closure of the Hamburg facility and
consolidation of the three UK access solutions businesses into a
single site that commenced in the second half of 2022 and are now
substantially completed.
The M&A integration costs relate to transaction fees
incurred in the period in respect of the acquisition of Lawrence
Industries, which completed subsequent to the period end.
The redundancy and restructuring costs in 2022 relate to the
closure of the Hamburg facility and the consolidation of the three
UK access solutions businesses into a single site. The costs
included severance, onerous contracts, winding up costs, and
certain costs of preparing and running new facilities that were not
yet operational.
5. Taxation
The Group reported an income tax charge to the income statement
of GBP5.6 million (six months ended 30 June 2022: GBP9.0 million),
comprising a current tax charge of GBP7.4 million (six months ended
30 June 2022: GBP11.0 million) and a deferred tax credit of GBP1.8
million (six months ended 30 June 2022: credit of GBP2.0
million).
The tax charge has been calculated using an effective tax rate
of 24.7% (six months ended 30 June 2022: 24.1%) based on tax rates
substantively enacted at 30 June 2023. The adjusted effective tax
rate was 24.4% (six months ended 30 June 2022: 24.4%). This is the
Group's current best estimate of the effective tax rate for the
2023 full year.
Deferred tax balances have been calculated at the substantively
enacted rates they are expected to unwind at in their respective
territories.
Income tax recognised in the statement of other comprehensive
income was GBPNil (six months ended 30 June 2022: GBPNil).
During the period, the Group paid corporation tax of GBP7.3
million (six months ended 30 June 2022: GBP10.0 million). The
decrease is a result of a refund of tax overpaid for the 2021 tax
year, which was received in H1 2023.
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2023 (unaudited) 2022 (unaudited) 2022 (audited)
GBPm GBPm GBPm
------------------------------------ ------------------ ------------------ ----------------
Current taxation
Current tax on profit for the
period (7.7) (11.2) (19.1)
Prior year adjustments 0.3 0.2 1.5
Total current taxation (7.4) (11.0) (17.6)
------------------------------------ ------------------ ------------------ ----------------
Deferred taxation
Origination and reversal of
temporary differences 1.8 1.9 4.6
Tax rate change adjustment - - 0.1
Prior year adjustments - 0.1 (0.7)
Total deferred taxation 1.8 2.0 4.0
------------------------------------ ------------------ ------------------ ----------------
Income tax charge in the income
statement (5.6) (9.0) (13.6)
------------------------------------ ------------------ ------------------ ----------------
Income tax charge in the statement
of other comprehensive income - - (0.5)
------------------------------------ ------------------ ------------------ ----------------
Total current taxation (7.4) (11.0) (17.9)
Total deferred taxation 1.8 2.0 3.8
Total taxation (5.6) (9.0) (14.1)
------------------------------------ ------------------ ------------------ ----------------
6. Earnings per share
6.1 Basic and diluted earnings per share
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2023 (unaudited) 2022 (unaudited) 2022 (audited)
------------------------------ ------------------ ------------------ ----------------
Profit for the period (GBPm) 17.1 28.4 47.8
Basic earnings per share 8.8p 14.6p 24.6p
Diluted earnings per share 8.7p 14.5p 24.5p
------------------------------- ------------------ ------------------ ----------------
Basic earnings per share amounts are calculated by dividing net
profit for the period attributable to ordinary equity holders by
the weighted average number of ordinary shares outstanding during
the period.
Diluted earnings per share amounts are calculated by dividing
the net profit attributable to ordinary equity holders by the
weighted average number of ordinary shares outstanding during the
period plus the weighted average number of ordinary shares that
would be issued on the conversion of all the dilutive potential
ordinary shares into ordinary shares.
6.2 Weighted average number of shares
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2023 (unaudited) 2022 (unaudited) 2022 (audited)
m m m
------------------------------- ------------------ ------------------ ----------------
Weighted average number of
shares in issue 196.8 196.8 196.8
Treasury shares (0.5) (0.5) (0.5)
Employee Benefit Trust shares (2.0) (1.7) (2.1)
------------------------------- ------------------ ------------------ ----------------
Weighted average number of
shares - basic 194.3 194.6 194.2
Effect of dilutive potential
ordinary shares (1) 1.3 0.7 1.0
Weighted average number of
shares - diluted 195.6 195.3 195.2
------------------------------- ------------------ ------------------ ----------------
(1) LTIP awards and options
7. Goodwill
30 June 30 June 31 December
2023 (unaudited) 2022 (unaudited) 2022 (audited)
GBPm GBPm GBPm
---------------------------------- ------------------ ------------------ ----------------
Net book amount at the beginning
of the period 399.3 363.3 363.3
Exchange difference (15.5) 34.5 36.0
Net book amount at the end
of the period 383.8 397.8 399.3
----------------------------------- ------------------ ------------------ ----------------
Goodwill is monitored principally on an operating segment basis
and the net book value of goodwill is allocated by CGU as
follows:
31 December
2022
30 June 2023 30 June
(unaudited) 2022 (unaudited) (audited)
GBPm GBPm GBPm
---------------------------- --- -------------- ------------------ ------------
North America 287.9 301.9 302.7
UK & Ireland 60.2 60.2 60.2
International 35.7 35.7 36.4
Net book amount at the end
of the period 383.8 397.8 399.3
--------------------------------- -------------- ------------------ ------------
Impairment assessment
The Directors have considered whether there are any impairment
indicators at the interim and have concluded that there are no
indicators that would require the Group to perform a full
impairment test at 30 June 2023.
8. Intangible assets
31 December
2022
30 June 2023 30 June
(unaudited) 2022 (unaudited) (audited)
GBPm GBPm GBPm
---------------------------------- -------------- ------------------ ------------
Net book amount at the beginning
of the period 57.7 66.8 66.8
Additions 2.2 2.1 4.9
Amortisation charge for the
period (9.0) (9.2) (19.6)
Impairment charge - - (0.2)
Exchange difference (2.0) 5.0 5.8
Net book amount at the end
of the period 48.9 64.7 57.7
---------------------------------- -------------- ------------------ ------------
The amortisation charge for the period includes GBP7.8 million
relating to amortisation of acquired intangible assets (six months
ended 30 June 2022: GBP8.5 million; year ended 31 December 2022:
GBP17.6 million) and GBP1.2 million relating to amortisation of
other intangible assets (six months ended 30 June 2022: GBP0.7
million; year ended 31 December 2021: GBP2.0 million). The
amortisation charge for the period is included in selling, general
and administrative expenses in the income statement.
9. Property, plant and equipment
31 December
2022
30 June 30 June 2022
2023 (unaudited) (unaudited) (audited)
GBPm GBPm GBPm
---------------------------------- ------------------ ------------- ------------
Net book amount at the beginning
of the period 74.6 63.5 63.5
Additions 5.1 9.0 19.2
Disposals (0.2) - (0.3)
Depreciation charge for the
period (6.1) (5.9) (12.4)
Impairment charge for the
period - - (0.7)
Exchange difference (2.3) 4.7 5.3
Net book amount at the end
of the period 71.1 71.3 74.6
---------------------------------- ------------------ ------------- ------------
The depreciation charge for the period is included in selling,
general and administrative expenses in the income statement.
10. Borrowings
31 December
2022
30 June 30 June 2022
2023 (unaudited) (unaudited) (audited)
GBPm GBPm GBPm
------------- --- ------------------ ------------- ------------
Current (27.2) (23.4) (15.9)
Non-current (162.0) (188.4) (172.5)
(189.2) (211.8) (188.4)
----------------- ------------------ ------------- ------------
Current borrowings include the bank overdrafts. See
reconciliation in note 14.
Movements in borrowings (excluding lease liabilities) are
analysed as follows:
30 June 30 June 31 December
2023 (unaudited) 2022 (unaudited) 2022 (audited)
GBPm GBPm GBPm
--------------------------- ------------------ ------------------ ----------------
Balance at the beginning
of the period (188.4) (149.1) (149.1)
Refinancing costs paid 0.2 0.2 2.1
Drawdown of borrowings (22.5) (82.3) (122.3)
Repayments of borrowings 26.6 56.3 113.0
Amortisation of borrowing
costs (0.3) (0.2) (0.6)
Net interest accrued - - (0.4)
Overdraft facility (11.3) (23.4) (16.4)
Exchange difference 6.5 (13.3) (14.7)
Balance at the end of
the period (189.2) (211.8) (188.4)
---------------------------- ------------------ ------------------ ----------------
There have been no changes to the multi-currency revolving
credit facility and US private placement notes during the period,
details of which are outlined in the Annual Report and Accounts for
the year ended 31 December 2022.
There were no defaults in the period under the terms of loan
agreements. The Group has significant headroom in both the leverage
and interest cover covenants.
The Group has the following undrawn committed multi-currency
revolving credit facility:
30 June 2023 30 June 31 December
(unaudited) 2022 (unaudited) 2022 (audited)
GBPm GBPm GBPm
------------------------- ------------- ------------------ ----------------
Floating rate
Expiry beyond 12 months (132.3) (140.5) (135.1)
-------------------------- ------------- ------------------ ----------------
The Group also has access to an uncommitted GBP100.0 million
accordion facility and at 30 June 2023 held net cash and cash
equivalents of GBP50.8 million (30 June 2022: GBP63.3 million; 31
December 2022: GBP58.2 million).
11. Share capital
Number Ordinary
of shares shares
'000 GBPm
------------------------------ ----------- ---------
At 30 June 2022, 31 December
2022 and 30 June 2023 196.8 9.8
------------------------------- ----------- ---------
12. Dividends
30 June 30 June 31 December
2023 (unaudited) 2022 (unaudited) 2022 (audited)
GBPm GBPm GBPm
------------------------------------- ------------------ ------------------ ----------------
Amounts recognised as distributions
to owners in the period:
Final dividend. For the year
ended 31 December 2022 9.5p per
share (2021: 8.9p) 18.5 17.2 17.2
Interim dividend. For the year
ended 31 December 2022 of 4.2p
(2021: 4.0p) - - 8.2
Total amounts recognised as
distributions to owners in the
period 18.5 17.2 25.4
------------------------------------- ------------------ ------------------ ----------------
Amounts not recognised in the
financial statements:
Final dividend proposed. For
the year ended 31 December 2022
9.5p per share (2021: 8.9p) - - 18.4
Interim dividend proposed. For
the year ending 31 December 2023
4.2p per share (2022: 4.2p) 8.2 8.1 -
------------------------------------- ------------------ ------------------ ----------------
13. Financial risk management and financial instruments
13.1 Financial risk factors and fair value estimation
The Group is exposed to risks arising from the international
nature of its operations and the financial instruments which fund
them, in particular to foreign currency, interest rate and
liquidity risks. Full details of the Group's policies for managing
these risks are disclosed in the Group's annual financial
statements for the year ended 31 December 2022.
Since the date of that report there have been no significant
changes in:
-- the nature of the financial risks to which the Group is exposed;
-- the Group's contractual cash outflows and the committed
facilities available to fund them, or
-- difference between book value and fair value of any financial instruments.
There have been no new financial instruments entered into in the
current period, with the exception of foreign exchange
contracts.
Derivatives shown at fair value in the Group's balance sheet
therefore comprise level 2 cross-currency interest rate swaps fair
valued using forward interest rates extracted from observable yield
curves, and forward exchange contracts fair valued by
marking-to-market contracts at the period end rate. The effects of
discounting are generally insignificant for level 2
derivatives.
During the period the Group held no level 1 financial
instruments, there were no transfers between levels and no changes
were made to valuation techniques.
The Group's other financial instruments are measured at
amortised cost.
13.2 Level 2 and level 3 fair values
The Group has the following financial assets and liabilities
categorised at levels 2 and 3:
30 June 30 June 31 December
2023 (unaudited) 2022 (unaudited) 2022 (audited)
GBPm GBPm GBPm
---------------------------------- ------------------ ------------------ ----------------
Level 2
Derivative financial assets - 0.3 0.2
Derivative financial liabilities (0.5) - (0.2)
Level 3
Financial assets at fair value
through profit or loss 1.2 1.2 1.2
---------------------------------- ------------------ ------------------ ----------------
13.3 Fair value of financial assets and liabilities measured at
amortised cost
The fair values of borrowings are as follows:
31 December
2022
30 June 30 June 2022
2023 (unaudited) (unaudited) (audited)
GBPm GBPm GBPm
------------- --- ------------------ ------------- ------------
Current (27.2) (6.4) (15.9)
Non-current (163.1) (187.7) (173.6)
(190.3) (194.1) (189.5)
----------------- ------------------ ------------- ------------
The fair values of trade and other receivables, cash and cash
equivalents, and trade and other payables approximate their
carrying amounts.
14. Adjustments to cash flows from operating activities
The following non-cash and financing adjustments have been made
to profit before taxation to arrive at operating cash flow:
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2023 (unaudited) 2022 (unaudited) 2022 (audited)
Note GBPm GBPm GBPm
------------------------------ ----- ------------------ ------------------ ----------------
Net finance costs 5.1 3.4 9.3
Depreciation of PPE 9 6.1 5.9 12.4
Depreciation of right of
use assets 3.9 3.7 7.1
Amortisation of intangible
assets 8 9.0 9.2 19.6
Impairment of intangible
assets 8 - - 0.2
Impairment of PPE 9 - - 0.7
Impairment of ROU - - 0.2
Loss on disposal of PPE 0.1 - 0.1
Pension service costs and
administration costs 0.1 0.1 0.3
Non-cash provision movements (0.7) (0.3) 2.1
Share-based payments 0.5 0.7 1.0
24.1 22.7 53.0
------------------------------ ----- ------------------ ------------------ ----------------
14.1 Reconciliation of cash and cash equivalents and bank
overdrafts at the period end
Six months Six months
ended ended Year ended
30 June 2022 30 June 31 December
(unaudited) 2022 (unaudited) 2022 (audited)
GBPm GBPm GBPm
----------------------------- -------------- ------------------ ----------------
Cash at bank and on deposit 78.6 86.7 74.6
Bank overdrafts (27.8) (23.4) (16.4)
Cash and cash equivalents
and bank overdrafts at
the end of the period 50.8 63.3 58.2
------------------------------ -------------- ------------------ ----------------
15. Related party transactions
There were no material related party transactions requiring
disclosure, other than compensation of key management personnel
which will be disclosed in the Group's Annual Report and Accounts
for the year ending 31 December 2023.
16. Events after the balance sheet date
On 12 July 2023, the Group completed the acquisition of 100% of
the share capital of Barry G Lawrence, Inc., which trades as
Lawrence Industries. Lawrence designs, manufactures and sells
high-performance composite hardware for sliding and hung windows to
North American window fabricators, and is based in North Carolina,
USA.
Lawrence was acquired for initial consideration of $57.0 million
on a debt and cash free basis. Further contingent consideration of
up to $12.5 million will be payable based on achievement of
stretching growth targets in respect of the financial results for
the two years up to and including 31 December 2024. Consideration
was funded from existing debt facilities. For the financial year
ended 31 December 2022, Lawrence reported unaudited revenue of
approximately $20.0 million and profit before tax of approximately
$7.5 million, with gross assets as at 31 December 2022 of $3.4
million. The acquisition will report as part of Tyman's North
America division.
Due to the short time period between the acquisition and the
date of these interim financial statements, acquisition accounting
has not yet been completed. Business combination disclosures will
be provided in the financial statements for the year ending 31
December 2023.
Statement of Directors' responsibilities
Each of the Directors of Tyman plc confirms, to the best of his
or her knowledge, that:
-- the Interim Financial Statements have been prepared in
accordance with IAS 34 'Interim Financial Reporting' as adopted by
the UK and give a true and fair view of the assets, liabilities,
financial position and profit and loss of Tyman plc;
-- the interim report includes a fair review of the information required by:
-- DTR 4.2.7R of the Disclosure Guidance and Transparency Rules
sourcebook of the United Kingdom's Financial Conduct Authority,
being an indication of important events that have occurred during
the first six months of the financial year and their impact on the
interim financial statements; and a description of the principal
risks and uncertainties for the remaining six months of the year;
and
-- DTR 4.2.8R of the Disclosure Guidance and Transparency Rules
sourcebook of the United Kingdom's Financial Conduct Authority,
being related party transactions that have taken place in the first
six months of the current financial year and that have materially
affected the financial position or performance of the Group during
that period; and any changes in the related party transactions
described in the last annual report that could do so.
The Directors of Tyman plc are listed in the Group's Annual
Report and Accounts for the year ending 31 December 2022.
A list of the current Directors is maintained at the Tyman
website: www.tymanplc.com .
By order of the Board
Jason Ashton
Interim Chief Executive Officer
24 July 2023
INDEPENT REVIEW REPORT TO TYMAN PLC
Conclusion
We have been engaged by Tyman plc ("the company") to review the
condensed set of financial statements for Tyman plc and its
subsidiaries (the "Group") in the half-yearly financial report for
the six months ended 30 June 2023 which comprises the condensed
consolidated balance sheet as at 30 June 2023 and the condensed
consolidated income statement, condensed consolidated statement of
comprehensive income, condensed consolidated statement of changes
in equity and condensed consolidated cashflow statement for the
six-months period then ended and the related notes 1 to 16.
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 30
June 2023 is not prepared, in all material respects, in accordance
with United Kingdom adopted International Accounting Standard 34
and the Disclosure Guidance and Transparency Rules of the United
Kingdom's Financial Conduct Authority.
Basis for Conclusion
We conducted our review in accordance with International
Standard on Review Engagements (UK) 2410 "Review of Interim
Financial Information Performed by the Independent Auditor of the
Entity" issued by the Financial Reporting Council for use in the
United Kingdom (ISRE (UK) 2410). A review of interim financial
information consists of making inquiries, primarily of persons
responsible for financial and accounting matters, and applying
analytical and other review procedures. A review is substantially
less in scope than an audit conducted in accordance with
International Standards on Auditing (UK) and consequently does not
enable us to obtain assurance that we would become aware of all
significant matters that might be identified in an audit.
Accordingly, we do not express an audit opinion.
As disclosed in note 2, the annual financial statements of the
Group are prepared in accordance with United Kingdom adopted
international accounting standards. The condensed set of financial
statements included in this half-yearly financial report has been
prepared in accordance with United Kingdom adopted International
Accounting Standard 34, "Interim Financial Reporting".
Conclusion Relating to Going Concern
Based on our review procedures, which are less extensive than
those performed in an audit as described in the Basis for
Conclusion section of this report, nothing has come to our
attention to suggest that the directors have inappropriately
adopted the going concern basis of accounting or that the directors
have identified material uncertainties relating to going concern
that are not appropriately disclosed.
This Conclusion is based on the review procedures performed in
accordance with ISRE (UK) 2410; however future events or conditions
may cause the entity to cease to continue as a going concern.
Responsibilities of the directors
The directors are responsible for preparing the half-yearly
financial report in accordance with the Disclosure Guidance and
Transparency Rules of the United Kingdom's Financial Conduct
Authority.
In preparing the half-yearly financial report, the directors are
responsible for assessing the Group's ability to continue as a
going concern, disclosing as applicable, matters related to going
concern and using the going concern basis of accounting unless the
directors either intend to liquidate the company or to cease
operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the review of the financial
information
In reviewing the half-yearly financial report, we are
responsible for expressing to the company a conclusion on the
condensed set of financial statements in the half-yearly financial
report. Our Conclusion, including our Conclusion Relating to Going
Concern, are based on procedures that are less extensive than audit
procedures, as described in the Basis for Conclusion paragraph of
this report.
Use of our report
This report is made solely to the company in accordance with
ISRE (UK) 2410. Our work has been undertaken so that we might state
to the company those matters we are required to state to it in an
independent review report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility
to anyone other than the company, for our review work, for this
report, or for the conclusions we have formed.
Deloitte LLP
Statutory Auditor
London, UK
24 July 2023
Alternative Performance Measures
The Group uses adjusted figures as key performance measures in
addition to those reported under IFRS, as the Group believes these
measures enable management and stakeholders to assess the trading
performance of the businesses, as they exclude certain items that
are considered to be significant in nature and/or quantum, foreign
exchange movements and the impact of acquisitions and disposals.
The alternative performance measures ("APMs") are consistent with
those used by management internally in business planning,
performance analysis, and reporting to the Board and ExCo. Some of
these measures are used for the purpose of setting remuneration
targets. The key APMs that the Group uses include like-for-like
("LFL") performance measures, adjusted operating profit, adjusted
profit before tax, adjusted operating cash flow, and adjusted net
debt. Explanations of how APMs are calculated and how they are
reconciled to the most relevant IFRS statutory measure are set out
below.
Limitations of APMs
APMs should not be viewed in isolation and are designed to
provide supplementary information. These may not be comparable to
similarly labelled measures used by other companies. Other
limitations of the Group's adjusted measures are that they exclude
the amortisation of intangibles acquired in business combinations,
but do not similarly exclude the related revenue and profits, and
they exclude the cost of major restructuring programmes but do not
similarly exclude the financial benefits derived from these.
Like-for-like or LFL revenue and adjusted operating profit
Definition
The comparison of revenue or operating profit, as appropriate,
excluding the impact of any acquisitions made during the current
year and, for acquisitions made in the comparative year, excluding
from the current year result the impact of the equivalent current
year pre-acquisition period. For disposals, results are excluded
for the whole of the current and prior period. The prior period
comparative is retranslated at the current period average exchange
rate. The Group considers these amendments provide shareholders
with a comparable basis from which to understand the organic
trading performance in the year.
Purpose
This measure is used by management to evaluate the Group's
organic growth in revenue and adjusted operating profit, excluding
the impact of M&A and currency movements.
Reconciliation/calculation
Six months Six months
ended ended
30 June 2023 30 June
(unaudited) 2022 (unaudited)
GBPm GBPm(1)
----------------------------------- --- --- ------------------ --------------------
Reported revenue 329.9 360.0
Effect of exchange rates - 12.2
Like-for-like revenue 329.9 372.2
--------------------------------------------- ------------------ --------------------
Adjusted operating profit(2) 38.7 49.3
Effect of exchange rates - 1.7
--------------------------------------------- ------------------ --------------------
Like-for-like adjusted operating
profit 38.7 51.0
(1) As adjusted to restate at current average year exchange
rate.
(2) Refer to the consolidated income statement for
reconciliation of adjusted operating profit.
Adjusted operating profit and adjusted operating margin
Definition
Operating profit before amortisation of acquired intangible
assets, impairment of goodwill and acquired intangible assets, and
adjusting items.
Adjusted operating margin is calculated as adjusted operating
profit divided by revenue, expressed as a percentage.
Purpose
This measure is used to evaluate the trading operating
performance of the Group.
Adjusting items are excluded from this measure to provide an
understanding of the elements of financial performance during the
year to facilitate comparison with prior periods and to assess the
trends in financial performance.
Adjusting items include significant redundancy and restructuring
costs, transaction costs and integration costs associated with
merger and acquisition activity, impairment charges related to
material intangible asset upgrades, as well as credits relating to
profit on disposal of businesses, and property provision releases.
These items are not considered to be a part of the ordinary course
of the Group's business.
Amortisation of acquired intangible assets is excluded from this
measure as this is a significant non-cash fixed charge that is not
affected by the trading performance of the business.
Impairment of acquired intangible assets and goodwill is
excluded, as this can be a significant non-cash charge.
Reconciliation/calculation
Adjusted operating profit is reconciled on the face of the
income statement on page 20.
Six months Six months
ended ended
30 June 2023 30 June 2022
(unaudited) (unaudited)
GBPm GBPm
------------------------------ --------------- -------------
Adjusted operating profit 38.7 49.3
Revenue 329.9 360.0
------------------------------ --------------- -------------
Adjusted operating margin (%) 11.7% 13.7%
------------------------------ --------------- -------------
Adjusted profit before and after tax
Definition
Profit before amortisation of acquired intangible assets,
deferred tax on amortisation of acquired intangible assets,
impairment of acquired intangible assets, impairment of goodwill,
adjusting items, unwinding of discount on provisions, gains and
losses on the fair value of derivative financial instruments,
amortisation of borrowing costs, accelerated amortisation of
borrowing costs and the associated tax effect.
Purpose
This measure is used to evaluate the profit generated by the
Group through trading activities. The above items are excluded as
they are of a non-trading nature. This metric is used in assessing
the Directors' remuneration.
Reconciliation/calculation
Six months Six months
ended ended
30 June 2023 30 June
(unaudited) 2022 (unaudited)
GBPm GBPm
------------------------------------- --------------- ------------------
Profit before taxation 22.7 37.4
Adjusting items 3.1 -
Loss/(gain) on revaluation of fair
value hedge 0.3 (0.7)
Amortisation of borrowing costs 0.3 0.2
Amortisation of acquired intangible
assets 7.8 8.5
-------------------------------------- --------------- ------------------
Adjusted profit before taxation 34.2 45.4
-------------------------------------- --------------- ------------------
Income tax charge (5.6) (9.0)
Add back: Adjusted tax effect(1) (2.8) (2.1)
-------------------------------------- --------------- ------------------
Adjusted profit after taxation 25.8 34.3
-------------------------------------- --------------- ------------------
(1) Tax effect of adjusted items, amortisation of borrowing
costs, amortisation of acquired intangible assets, and gain or loss
on revaluation of fair value hedge.
Adjusted earnings per share
Definition
Adjusted profit after tax divided by the basic weighted average
number of ordinary shares in issue during the year, excluding those
held as treasury shares.
Purpose
This measure is used to determine the improvement in earnings
from trading activities per share for the Group's shareholders.
This metric is used in assessing the Directors' remuneration.
Reconciliation/calculation
Six months Six months
ended ended
30 June 30 June
2023 (unaudited) 2022 (unaudited)
------------------------------------------- --------------------- --------------------
Adjusted profit after tax 25.8 34.3
Weighted average number of shares- basic 194.6 194.6
Weighted average number of shares- diluted 195.6 195.3
Basic adjusted earnings per share 13.3p 17.6p
------------------------------------------------ -------------------- ----------------
Diluted adjusted earnings per share 13.2p 17.6p
------------------------------------------------ -------------------- ----------------
Covenant net interest
Definition
Covenant net interest is LTM interest payable on bank loans,
private placement notes and overdrafts and interest income from
short-term bank deposits.
Purpose
This measure is used in the covenant metric of interest
cover.
Reconciliation/calculation
Six months Six months
ended ended
30 June 30 June 2022
2023 (unaudited) (unaudited)
GBPm GBPm
------------------------------------------------- ----------------- -------------
Interest from loans 4.5 2.9
Interest income from short term deposits (1.0) (0.2)
Adjustment to align to LTM covenant net interest 3.1 2.7
------------------------------------------------- ----------------- -------------
Covenant net interest 6.6 5.4
------------------------------------------------- ----------------- -------------
Covenant EBITDA and covenant adjusted EBITDA
Definition
Covenant EBITDA is LTM adjusted operating profit with
depreciation, amortisation of computer software, and share-based
payments expenses added back, less RoU depreciation and interest
payable on lease liabilities.
Covenant adjusted EBITDA is LTM EBITDA plus the pre-acquisition
EBITDA of businesses acquired during the year covering the relevant
pre-acquisition period less the EBITDA of businesses disposed of
during the year.
Purpose
This measure is used as the numerator in calculating covenants
under the terms of the Group's revolving credit facility.
Reconciliation/calculation
Six months Six months
ended ended
30 June 2023 30 June 2022
(unaudited) (unaudited)
GBPm GBPm
---------------------------------------------- -------------- -------------
Adjusted operating profit 38.7 49.3
Depreciation of property, plant and equipment 6.1 5.9
Amortisation of computer software 1.2 0.7
Interest payable on lease liabilities (1.3) (1.2)
Share-based payments 0.5 0.7
Adjustment to align to LTM covenant EBITDA 51.4 49.6
Covenant EBITDA and covenant adjusted EBITDA 96.6 105.0
---------------------------------------------- -------------- -------------
Interest cover
Definition
Covenant adjusted EBITDA divided by the net interest payable on
bank loans, private placement notes and overdrafts and interest
income from short-term bank deposits.
Purpose
This measure is used to evaluate the profit available to service
the Group's interest costs. This is one of the covenants the Group
is subject to under the terms of its revolving credit facility.
Reconciliation/calculation
Six months Six months
ended ended
30 June 30 June 2022
2023 (unaudited) (unaudited)
GBPm GBPm
------------------------- ----------------- -------------
Covenant adjusted EBITDA 96.6 105.0
Covenant net interest 6.6 5.4
------------------------- ----------------- -------------
Interest cover (x) 14.6x 19.3x
------------------------- ----------------- -------------
Gross debt and adjusted gross debt
Definition
Gross debt is borrowings and lease liabilities. Adjusted gross
debt is gross debt, with capitalised borrowing costs added
back.
Purpose
This gives a measure of the gross amount owed to lenders,
without the effect of capitalised borrowing costs for which cash
outflow has already occurred.
Reconciliation/calculation
30 June 30 June 2022
2023 (unaudited) (unaudited)
GBPm GBPm
---------------------------- ----------------- -------------
Borrowings (189.2) (211.8)
Lease liabilities (57.2) (56.9)
---------------------------- ----------------- -------------
Gross debt (246.4) (268.7)
---------------------------- ----------------- -------------
Capitalised borrowing costs (2.1) (0.6)
---------------------------- ----------------- -------------
Adjusted gross debt (248.5) (269.3)
---------------------------- ----------------- -------------
Net debt
Definition
Long and short term borrowings, including lease liabilities and
bank overdraft, net of cash and cash equivalents.
Purpose
This gives a measure of the net amount of debt repayable by the
company.
Reconciliation/calculation
30 June 30 June 2022
2023 (unaudited) (unaudited)
GBPm GBPm
-------------------------- ----------------- -------------
Gross debt (246.4) (268.7)
Cash and cash equivalents 78.6 86.7
-------------------------- ----------------- -------------
Net debt (167.8) (182.0)
-------------------------- ----------------- -------------
Adjusted net debt and covenant adjusted net debt
Definition
Borrowings, plus capitalised borrowing costs and lease
liabilities, net of cash and cash equivalents, adjusted to reflect
the weighted average exchange rate as required per the covenant
agreement.
Purpose
This gives a measure of the gross amount owed to lenders,
without the effect of capitalised borrowing costs.
Reconciliation/calculation
30 June 30 June
2023 (unaudited) 2022 (unaudited)
GBPm GBPm
--------------------------------------------- ----------------- -----------------
Net debt (167.8) (182.0)
Lease liabilities 57.2 56.9
Capitalised borrowing costs (2.1) (0.6)
--------------------------------------------- ----------------- -----------------
Adjusted net debt (112.7) (125.7)
--------------------------------------------- ----------------- -----------------
Adjustment to weighted average exchange rate (2.3) 8.2
--------------------------------------------- ----------------- -----------------
Covenant adjusted net debt (115.0) (117.5)
--------------------------------------------- ----------------- -----------------
Leverage
Definition
Adjusted net debt translated at the average exchange rate for
the year, divided by covenant adjusted EBITDA as defined in the
lending agreements.
Purpose
This measure is used to evaluate the ability of the Group to
generate sufficient cash flows to cover its contractual debt
servicing obligations.
Reconciliation/calculation
30 June 30 June
2023 (unaudited) 2022 (unaudited)
GBPm GBPm
------------------------------------------------ ----------------- -----------------
Covenant adjusted net debt (at average exchange
rate) (115.0) (117.5)
Covenant adjusted EBITDA 96.6 105.0
------------------------------------------------ ----------------- -----------------
Leverage (x) 1.2x 1.1x
------------------------------------------------ ----------------- -----------------
Adjusted operating profit (LTM)
Definition
Adjusted operating profit aligned to the last twelve months.
Purpose
This measure is used in the ROCE calculation.
Reconciliation/calculation
Six months Six months
ended ended
30 June 30 June 2022
2023 (unaudited) (unaudited)
GBPm GBPm
-------------------------------- ----------------- -------------
Adjusted operating profit 38.7 49.3
Adjustment to LTM 45.2 42.2
-------------------------------- ----------------- -------------
Adjusted operating profit (LTM) 83.9 91.5
-------------------------------- ----------------- -------------
Return on Capital Employed (ROCE)
Definition
LTM adjusted operating profit as a percentage of the last
thirteen-month average capital employed.
Purpose
This measure is used to evaluate how efficiently the Group's
capital is being employed to improve profitability. This metric is
used in assessing the Directors' remuneration.
Reconciliation/calculation
Six months Six months
ended ended
30 June 2023 30 June
(unaudited) 2022 (unaudited)
GBPm GBPm
-------------------------------- ------------- -----------------
Adjusted operating profit (LTM) 83.9 91.5
Average capital employed 729.7 656.2
-------------------------------- ------------- -----------------
Return on capital employed (%) 11.5% 13.9%
-------------------------------- ------------- -----------------
Average capital employed
----------------------------- ------- ------ --- --------------------- --- ----
Inventories 131.8 169.9
Trade and other receivables 99.3 107.7
Intangible assets 48.9 64.7
Property, plant & equipment 71.1 71.3
Right-of-use asset 53.4 53.2
Goodwill 383.8 397.8
Deferred tax asset 1.5 4.4
Trade and other payables (87.5) (130.3)
Tax liabilities (1.7) (6.9)
Provisions - current (1.0) (1.2)
Provisions non - current (3.5) (4.8)
Deferred tax liabilities (4.7) (11.1)
Financial assets at
FV through P&L 1.2 1.2
--------------------------------------------------- --------------- ---------------
Total capital employed 692.6 715.9
--------------------------------------------------- --------------- ---------------
Adjustment to 13-month
average 37.1 (59.7)
--------------------------------------------------- --------------- ---------------
Average capital employed 729.7 656.2
--------------------------------------------------- --------------- ---------------
Adjusted operating cash flow and adjusted operating cash
conversion
Definition
Adjusted operating cash flow
Net cash generated from operations before income tax paid,
adjusting items cash settled in the year, pension contributions,
and after proceeds on disposal of property, plant and equipment,
payments to acquire property, plant and equipment and payments to
acquire intangible assets.
Adjusted operating cash conversion
Adjusted operating cash flow divided by adjusted operating
profit.
Purpose
These measures are used to evaluate the cash flow generated by
the business operations in order to pay down debt, return cash to
shareholders and invest in acquisitions.
Reconciliation/calculation
A reconciliation is included in the financial review on page
15.
Free cash flow
Definition
Adjusted operating cash flow after deducting pension
contributions, income tax paid, net interest paid and adjusted cash
costs settled in the year.
Purpose
This measure is used to evaluate the cash flow generated by the
business operations after expenditure incurred on maintaining
capital assets.
Reconciliation/calculation
See page 15 for reconciliation between adjusted operating cash
flow and free cash flow.
Adjusted selling, general and administrative expenses
Definition
Selling, general and administrative expenses before adjusting
items, amortisation of acquired intangible assets, impairment of
acquired intangible assets and impairment of acquired goodwill.
Purpose
This measure is used to evaluate the selling, general and
administrative expenses of the business excluding the effect of
adjusting items and amortisation of acquired intangible assets,
which is a significant charge that is not directly affected by
trading.
Reconciliation/calculation
Six months Six months
ended ended
30 June 2023 30 June
(unaudited) 2022 (unaudited)
GBPm GBPm
--------------------------------------------- ------------- -------------------
Selling, general and administrative expenses (79.9) (75.6)
Adjusting items 3.1 -
Amortisation of acquired intangible assets 7.8 8.5
Adjusted selling, general and administrative
expenses (69.0) (67.1)
--------------------------------------------- ------------- -------------------
Adjusted tax charge
Definition
Tax charge adjusted for the tax effect of adjusted items,
amortisation of borrowings costs, amortisation of acquired
intangible assets, gain or loss on revaluation of fair value hedge
and unwinding of discount on provisions.
Purpose
This measure is used to evaluate the tax charge arising on the
adjusted profit of the Group.
Reconciliation/calculation
Six months Six months
ended ended
30 June 30 June
2023 (unaudited) 2022 (unaudited)
GBPm GBPm
------------------------------ ----------------- -----------------
Tax charge (5.6) (9.0)
Tax effect of adjusting items (2.8) (2.1)
------------------------------ ----------------- -----------------
Adjusted tax charge (8.4) (11.1)
------------------------------ ----------------- -----------------
Adjusted effective tax rate
Definition
Adjusted tax charge divided by adjusted profit before tax.
Purpose
This measure is used to evaluate the tax charge relative to
profit arising on the adjusted trading activity of the Group.
Reconciliation/calculation
Six months Six months
ended ended
30 June 2023 30 June
(unaudited) 2022 (unaudited)
GBPm GBPm
-------------------------------- ------------- -----------------
Adjusted tax charge (8.4) (11.1)
Adjusted profit before tax 34.2 45.4
-------------------------------- ------------- -----------------
Adjusted effective tax rate (%) 24.4% 24.4%
-------------------------------- ------------- -----------------
DEFINITIONS AND GLOSSARY OF TERMS
APM Alternative Performance Measure
bps Basis points
CGU Cash generating unit
CHIC Concealed Hardware Innovative Components
CPA Construction Products Association
CPMI Construction Purchasing Managers' Index
EBITDA Earnings before Interest, Taxation, Depreciation
and Amortisation
EBT Employee Benefit Trust
EPD Environmental Product Declaration
EPS Earnings per share
ERP Enterprise Resource Planning
FRC Financial Reporting Council
GHG Greenhouse gases
GCC Gulf Cooperation Council
IFRS International Financial Reporting Standards
LFL Like-for-like
LIRA Leading Indicator of Replacement Activity
LTIFR Lost time incident frequency rate
LTM Last twelve months
LTIP Long term incentive plan
M&A Mergers and acquisitions
NAHB The National Association of Home Builders
PMI Purchasing Managers' Index
PPE Property, plant and equipment
RCF Revolving credit facility
RMI Renovation, maintenance and improvement
ROCE Return on capital employed
RoU Right of use
Tyman Any references to Tyman, the Group, or the
Company refer to Tyman plc and its subsidiaries
USPP US private placement
EXCHANGE RATES
The following foreign exchange rates have been used in the
financial information to translate amounts into Sterling:
Closing Rates: H1 2023 H1 2022 FY 2022
-------------------- -------- -------- --------
US Dollars 1.2663 1.2147 1.2097
Euros 1.1633 1.1624 1.1298
Australian Dollars 1.9070 1.7625 1.7743
Canadian Dollars 1.6777 1.5660 1.6386
Brazilian Real 6.1165 6.3258 6.3937
-------------------- -------- -------- --------
Average Rates: H1 2023 H1 2022 FY 2022
-------------------- -------- -------- --------
US Dollars 1.2334 1.2992 1.2370
Euros 1.1412 1.1877 1.1732
Australian Dollars 1.8256 1.8059 1.7795
Canadian Dollars 1.6621 1.6516 1.6078
Brazilian Real 6.2537 6.5993 6.3857
-------------------- -------- -------- --------
ROUNDINGS
Percentage numbers have been calculated using unrounded figures,
which may lead to small differences in some figures and percentages
quoted.
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