TIDMNICL
RNS Number : 1055E
Nichols PLC
26 February 2020
Date: Embargoed until 0700 Wednesday 26 February 2020
Contacts: Marnie Millard, Group Chief Executive Officer
Tim Croston, Group Chief Financial Officer
Andrew Milne, Group Chief Operating Officer
Nichols plc
Telephone: 01925 222 222
Website: www.nicholsplc.co.uk
Alex Brennan/ Hattie Steve Pearce/ Rachel Hayes
Dreyfus N+1 Singer
Hudson Sandler
Telephone: 020 7796 (Nominated Adviser and Broker)
4133
Email: nichols@hudsonsandler.com Telephone: 0207 496 3000
Website: www.n1singer.com
Nichols plc
2019 PRELIMINARY RESULT
Nichols plc ('Nichols' or the 'Group'), the soft drinks Group,
announces its Preliminary results for the year ended 31 December
2019 (the 'period').
*EBITDA is the statutory Year ended Year ended
profit before tax, interest, 31 Dec 2019 31 Dec 2018
depreciation and amortisation
GBPm GBPm
------------- ------------- ------
Group Revenue 147.0 142.0 +3.5%
------------- ------------- ------
Operating Profit 32.4 31.6 +2.5%
------------- ------------- ------
Operating Profit margin 22.1% 22.3%
------------- ------------- ------
EBITDA* 37.0 33.8 +9.5%
------------- ------------- ------
Profit Before Tax 32.4 31.8 +2.1%
------------- ------------- ------
PBT margin 22.1% 22.4%
------------- ------------- ------
Earnings Per Share (basic) 72.81p 69.23p +5.2%
------------- ------------- ------
Final dividend 28.0p 26.8p +4.5%
------------- ------------- ------
John Nichols, Non-Executive Chairman, said:
"I am pleased to report on a year of further progress during
which Nichols achieved continued revenue growth in both our
International and UK businesses. As a result, the Group delivered
year-on-year increases in profit before tax and earnings per share
and we are today proposing a final dividend of 28.0 pence per
share, resulting in a 6.0% increase in the full year dividend.
The Group's performance demonstrates the strength of our
diversified business model, which provides a strong platform to
deliver continued growth."
Chairman's Statement
I am pleased to announce another strong performance from Nichols
plc. During the year, the Group delivered further progress against
its strategic objectives, successfully increasing revenue, profit
and earnings per share. This performance was delivered against
challenging market conditions as has been widely reported
elsewhere.
Trading
Total Group revenue increased by 3.5% to GBP147.0m (2018:
GBP142.0m). Both our UK and International businesses contributed to
this positive performance.
UK sales grew by 2.5% to GBP117.5m (2018: GBP114.6m).
Within the UK business, Vimto brand sales performed well,
increasing by 0.8% against very strong prior year comparatives
(2018: +12.9%). This performance was primarily driven by the Still
category where sales of Vimto dilutes grew by 15% and continued to
gain market share.
Elsewhere in our UK business, Out of Home sales increased by
8.0% to GBP45.5m (2018: GBP42.2m) and now contribute 31% of Group
revenue. This increase was largely driven by the acquisition of one
of our post mix and coffee distributors (Adrian Mecklenburgh
Limited) and the growth of frozen beverages into the cinema
channel. The continued growth in Out of Home demonstrates our
diversified strategy and is a result of the significant investment
in this part of our business over recent years.
International sales grew by 7.5% to GBP29.5m (2018: GBP27.4m).
In our African markets, revenues were GBP13.0m compared to GBP13.6m
in the prior year. Sales to the Middle East grew by 20.6% to
GBP11.6m against softer prior year comparatives (2018: GBP9.6m). As
anticipated, this performance reflects a return to normal levels of
concentrate sales during the year. Within the region, we achieved
our best ever sales performance of the Vimto brand during Ramadan
2019.
Elsewhere in our International regions, there was good growth in
the USA, which is primarily a Stills market (+23.1% to GBP1.4m) and
Europe which is primarily a Carbonate market (+5.2% to
GBP3.3m).
Group Profit Before Tax was GBP32.4m for the year, an increase
of 2.1% compared to the prior year (2018: GBP31.8m).
Dividend
As a reflection of the Board's confidence in the Group's
long-term financial position and the performance in the year, we
are pleased to recommend a final dividend of 28.0 pence per share
(2018: 26.8 pence).
If approved by our shareholders, the total dividend for 2019
will be 40.4 pence per share (2018: 38.1 pence), an increase of
6.0% on the prior year. Subject to shareholder approval, the final
dividend will be paid on 1 May 2020 to shareholders registered on
20 March 2020; the ex-dividend date is 19 March 2020.
Summary
In summary, the Board is pleased with the Group's performance in
2019. Despite the market headwinds, the business has once again
delivered profitable sales growth, maintained its strong cash
generative model and as a Board, we are proposing a final dividend
of 28.0 pence per share, resulting in a 6.0% increase in the full
year dividend.
Outlook
Further to our trading announcement on 23 December 2019
regarding the new Sweetened Beverage Excise Tax in Saudi Arabia and
the UAE, we anticipate being in a position to update the market in
our Interim Results Announcement on 22 July 2020. At that point in
time, we will have the benefit of the data post the critical
Ramadan trading period.
Elsewhere across the Group, we are confident that our
diversified and profitable business model will support the
continued growth trend into 2020 and beyond.
John Nichols
Non-Executive Chairman
25 February 2020
Notes to Editors:
Nichols plc is an international soft drinks business with sales
in over 85 countries, selling products in both the Still and
Carbonate categories. The Group is home to the iconic Vimto brand
which is popular in the UK and around the world, particularly in
the Middle East and Africa. Other brands in its portfolio include
Feel Good, Starslush, ICEE, Levi Roots and Sunkist.
Chief Executive Officer's Statement
During 2019, we continued to evolve our strategy aimed at the
long-term, sustainable development of our business by delivering
growth opportunities across the Group. To support this, we launched
a series of initiatives to ensure our stakeholders share the
Board's exciting long-term vision for Nichols plc and have clarity
on our priorities over the coming years.
During 2019, the Group made further progress in the area of
sustainability, but we recognise that there is much more we can do.
In January 2020 we launched our revised Environmental, Social and
Governance agenda to our colleagues, which is focused on creating a
"Happier Future". Further details of our sustainability commitments
and vision are set out in our 2019 Annual Report. Not only are
these commitments the right thing to do, we firmly believe that the
"Happier Future" pillar of our strategy is critical to ensuring the
Group's sustainable growth for future generations.
Underpinning our strategy are the strengths of our unique
brands, a relentless focus on putting the customer front and centre
of everything we do, and our fantastic team. I would like to thank
our colleagues for all their hard work in delivering success
against some challenging trading conditions during the year. In
particular, I would like to show my appreciation to Tim Croston,
our outgoing Chief Financial Officer, for his significant
contribution to Nichols plc over his 15 years with the Group and to
wish him every success in his future ventures. As announced in
October 2019, Tim will step down from the Board by 30 June 2020 and
we are pleased to welcome David Rattigan as our new Chief Financial
Officer, who officially takes up the role on 2 March 2020.
Marnie Millard
Chief Executive Officer
25 February 2020
Chief Operating Officer's Report
2019 has again been a strong year for the whole Group with both
the UK and International regions contributing to the growth of the
business. This again highlights the strength of our diversified
business model, which gives us a strong platform to drive success
in the market place.
Total Group revenue grew by 3.5% to GBP147.0m. Sales of our
Still portfolio grew by 10.8% which was driven by the excellent
results in our Middle East region, reflecting an exceptional sales
performance during Ramadan 2019. Carbonates declined by 2.6% as a
result of the strong comparatives in our UK business from the
summer of 2018. Our gross profit grew by 7.9%, ahead of revenue
growth, with gross margin improving to 47.6% from 45.7% in 2018.
This pleasing result demonstrates the continued success of our
"Value over Volume" strategy.
All of the partners we work with across our entire business
continue to play an important role in helping us to achieve our
success and I would like to thank them all for their collaboration
and support during 2019.
UK Soft Drinks
(Statistics given below on the market are as measured by Nielsen
in the year to 28 December 2019.)
In 2019, volumes in the GBP8.7bn UK soft drinks market declined
by 2.4%. However, value sales grew by 0.8% against very strong
comparatives in the prior year (2018: +7.8%).
Within the soft drinks market, value growth was seen across
Cola, Energy, Iced Coffee and Fruit Carbonate categories. Fruit
drinks, Plain and Flavoured Water and Fruit Juice were all sectors
in decline in 2019.
Vimto grew in line with the total market, adding GBP0.8m to its
brand value (Nielsen data) in the twelve month period to a record
GBP90.3m.
The soft drinks category remains intensely competitive and
promotionally driven, but we continue to add value with our product
innovation under the sub brand Remix, growing at an impressive 30%
and adding GBP3.2m to the brand total year-on-year.
Vimto continues to outperform the market in Stills. Vimto Squash
achieved 8.7% growth versus a market decline of 1.4%, whilst Vimto
ready to drink has outperformed the market by 5.1 percentage
points.
All of our marketing campaigns in 2019 have been at the core of
driving the brand's growth. Our 'I see Vimto in you' campaign that
was launched successfully in the UK during 2018 was again used
throughout 2019. The teams received external recognition from the
industry for the success of the campaign by winning the Drum, Fab
and Prolific North Awards. Our consumers continue to love the
brand, as demonstrated by us achieving our highest ever household
penetration in the UK at 6.7m households (+500k households vs. 2018
as measured by Kantar).
Within the UK packaged sector, the exceptionally strong
performance of our dilutes portfolio has been the key driving force
of our success. We have achieved sales revenue growth of 15% in
2019. This has driven strong market share growth and has firmly
consolidated our position as the UK's No.2 squash brand.
Our continued focus on health has seen our 'No Added Sugar'
portfolio grow by 7% as consumer tastes and preferences continue to
evolve.
Innovation has once again played a crucial role in our success
and our Remix brand portfolio has delivered sales growth of 14%.
Offering new and exciting flavours is critical to bringing new
younger consumers into the brand to ensure Vimto's longevity in the
marketplace.
We continue to work in collaboration with all of our customers
across the UK grocery, foodservice, wholesale and discount
channels. We were proud to have been awarded The Grocer's 'Soft
Drinks Supplier of the Year Award', voted by our customers who
highlighted our strong category management approach, clear
long-term strategic focus and the high quality of our sales people.
We will continue to put our customers at the heart of what we do to
ensure we deliver long-term success together.
UK On-Trade
(As measured by CGA Total Out of Home, Licensed &
Foodservice in the 12 months to 31 October 2019.)
Soft drinks remain a hugely important part of Out of Home sales,
particularly when we look at the Licensed sector total drinks sales
mix. In Licensed outlets, soft drinks sales volume totals 750m
litres annually, representing a quarter share of total drinks sales
volume and nearly 15% of sales value.
When we look at the trends in comparison to other categories in
Licensed, the sales of soft drinks are in line with total drinks
sales and ahead of Beer, Cider & Wine. Soft drinks sales are
outperforming other categories, which have been greater impacted by
cautious consumer spending and a decline in eating out visits
compared to 2018.
In the UK, sales of soft drinks in Licensed & Foodservice
combined saw a drop in consumption during 2019 vs. 2018, as volume
declined 2.2% to 1.8 billion litres for the year. This was driven
by a 3.3% decline in Foodservice as well as the impact of the
number of Licensed & Foodservice outlets in the UK declining
1.8%.
Sales by value are up 1.3% year-on-year at GBP7.3bn for total
Out of Home. Value over volume sales have been driven through a
combination of premium sales in Licensed and taxation from the Soft
Drinks Industry Levy.
The Out of Home channel has delivered strong sales growth of 8%
in 2019. A key driver of this growth has been due to the launch of
our new ICEE Frozen Carbonated range, with leading edge equipment,
into the cinema channel. We have delivered a range of innovative
flavours, supported by a marketing campaign in venues and on cinema
screens.
Acquisitions have played a vital role in our success within Out
of Home in 2019. Having acquired The Noisy Drink Company North West
Limited in 2018, we made a further acquisition of one of our
distributor partners, Adrian Mecklenburgh Limited (AML), in
February 2019. AML sell both bag-in-box soft drinks and liquid
coffee via dispense equipment within the Kent region and also has
the rights to sell liquid coffee in partnership with Douwe Egberts
in both Kent and Central London. This now gives us the opportunity
to enter the fast growing coffee market with a strong branded
partner in key UK geographies.
A key pillar of our long-term strategy is to offer leading
brands across all of our markets and we are pleased to have secured
a new long-term partnership with Coca-Cola Europe Partners that
allows us to continue to offer our customers in the Out of Home
channel bag-in-box Coca-Cola.
We have also opened a new state of the art technical centre and
showroom in Swindon allowing our customers to see our world class
equipment and brands all under one roof. We have also created a new
technical apprenticeship scheme in conjunction with local
Governments, giving young people the opportunity to learn new
skills within our business.
Vimto International
Despite the backdrop of difficult trading conditions in the
Middle East region, in 2019 we have delivered one of our strongest
ever Ramadan campaigns; a fully integrated 360-degree marketing
campaign called '#Always Shining', coupled with outstanding
in-store execution, delivered 8% sales growth.
The '#Always Shining' campaign focused on the evolving role of
Middle Eastern women in their diverse roles from a warm, welcoming
family home to the busy world of work.
Innovation has played a pivotal role in our success across the
region in 2019. One example of this is the launch of a brand new
blue raspberry flavour in still 250ml PET plastic bottles and a
400ml carbonated range, which consumers have reacted very
positively to the flavour profile and the products have made a
significant contribution throughout the campaign.
Against some challenging trading conditions in Africa, we have
again opened new markets within the continent during the year. We
have partnered with Bakhresa, who are a well-established
distributor within Tanzania and launched a range of Vimto products
across the various trading channels. The products have been well
received by consumers during the season. Overall, sales within our
African region totalled GBP13.0m (2018: GBP13.6m), 3.8% behind the
prior year.
The momentum we have seen in the USA with our long-standing
partner, Ziyad, continues to progress well and with a strong focus
on in-store execution, double-digit sales growth was delivered
during the key summer trading period.
Across our European markets, we have focused on driving deeper
distribution, which has resulted in new business wins and strong
revenue growth.
Brand Licensing
Our brand licensing division ensure the iconic Vimto flavour is
enjoyed across a variety of ranges by our consumers and launched
some exciting new products during the year. A key highlight during
2019 was our Jelly Babies being awarded the 'Grocer Best Product
Award 2019'.
Andrew Milne
Chief Operating Officer
25 February 2020
Financial Review
Income Statement
Year ended 31 December Year ended 31 December
2019 2018
GBPm GBPm
----------------------- -----------------------
Revenue 147.0 142.0
----------------------- -----------------------
Gross Profit 70.0 64.9
----------------------- -----------------------
GP% 47.6% 45.7%
----------------------- -----------------------
Distribution expenses (7.4) (7.2)
----------------------- -----------------------
Operating expenses excluding
depreciation & amortisation (25.6) (23.8)
----------------------- -----------------------
EBITDA 37.0 33.8
----------------------- -----------------------
Depreciation & amortisation
excluding impact of
IFRS 16 (3.5) (2.2)
----------------------- -----------------------
Depreciation as a result (1.0) -
of IFRS 16
----------------------- -----------------------
Operating Profit 32.4 31.6
----------------------- -----------------------
Operating profit margin 22.1% 22.3%
----------------------- -----------------------
Finance income 0.2 0.2
----------------------- -----------------------
Finance expense (0.3) (0.1)
----------------------- -----------------------
Profit Before Tax 32.4 31.8
----------------------- -----------------------
PBT % 22.1% 22.4%
----------------------- -----------------------
Tax (5.6) (6.2)
----------------------- -----------------------
Profit after tax 26.8 25.5
----------------------- -----------------------
Revenue
Group revenue for the year was GBP147.0m, an increase of 3.5%
compared to 2018. Excluding the acquisition of Adrian Mecklenburgh
Limited (AML), like for like Group revenue was GBP144.0m, an
increase of 1.4% compared to 2018.
The year-on-year growth came entirely from the Still category,
where revenues increased by 10.8% to GBP71.7m (2018: GBP64.7m).
This growth was driven by the Vimto dilutes category in the UK
where sales were up 14.8% and shipments of Vimto concentrate to the
Middle East, which were 20.6% ahead of 2018, albeit against softer
prior year comparatives.
The Carbonate category sales were GBP75.3m, 2.6% down on the
prior year (2018: GBP77.4m) which was indicative of the industry
wide slow-down in 2019 in comparison to 2018, when we had the
record summer weather.
It is pleasing to report that both our UK and International
business delivered growth in the year, which again demonstrates the
value of our diversified business model.
Revenue FY 2019 FY 2018 Movement
GBPm GBPm
-------- -------- ---------
UK 117.5 114.6 +2.5%
-------- -------- ---------
International 29.5 27.4 +7.5%
-------- -------- ---------
Gross Profit
Gross Profit was GBP70.0m, an increase of 7.9% in comparison to
the prior year. The increase was relatively ahead of revenue
performance due to the strong growth in the Middle East. As a
result, Gross Margin improved to 47.6% from 45.7% in 2018.
Distribution Expenses
Distribution expenses totalled GBP7.4m which was a marginal
(2.6%) increase on the prior year and commensurate with UK revenue
growth, which incurs the majority of Nichols' distributions
costs.
Operating Expenses excluding Depreciation and Amortisation
Operating expenses excluding depreciation and amortisation were
GBP25.6m, an increase of GBP1.8m in comparison to 2018.
The significant cost increases during the year were:
-- GBP1.3m incremental overheads from the acquisition of AML
-- GBP1.0m net adverse forex cost in contrast to a gain in 2018
-- GBP0.4m incremental uplift in wages & salaries
A credit of GBP1.0m has been recognised within operating
expenses during the year, following a fair value assessment of the
deferred consideration payable as part of the acquisition of
AML.
Nichols plc adopted IFRS 16, Leases for the first time in 2019.
The Group adopted IFRS 16 using the modified retrospective
approach, without the restatement of comparative figures. This had
the effect of removing approximately GBP1.1m of lease charges from
operating expenses. However, the corresponding increase in
depreciation and finance charges negated any impact on Profit
Before Tax.
Earnings Before Interest, Tax, Depreciation and Amortisation
(EBITDA)
EBITDA for the year was GBP37.0m, an increase of 9.5% (GBP3.2m)
compared to the prior year.
As explained above, the adoption of IFRS 16 had the effect of
inflating EBITDA by GBP1.1m due to the removal of operating lease
charges. EBITDA on a like for like basis (i.e. excluding the impact
of IFRS 16) would have been GBP35.8m which would have been 5.9%
ahead of the prior year and still broadly in line with the Gross
Profit increase.
Depreciation and Amortisation
Like for like depreciation and amortisation has increased to
GBP3.5m from GBP2.2m in the prior year. The increase is mainly
caused by incremental depreciation of freezer equipment, which
supports the growth in our Out of Home business and additional
amortisation of intangibles associated with recent
acquisitions.
Additional depreciation as a result of adopting IFRS 16 is
approximately GBP1.0m for the year, which nets off against a
similar value of lease charges in prior years. Therefore, there is
no significant impact on Profit Before Tax from the adoption of
IFRS 16 and no cash impact.
Operating Profit
Operating Profit for the year was GBP32.4m, an increase of 2.5%
compared to 2018.
The operating margin was 22.1% which was similar to the prior
year (2018: 22.3%).
Finance Income and Expense
Finance income of GBP0.2m (2018: GBP0.2m) relates to the bank
interest received during the year on the Group's cash deposits.
The finance expense of GBP0.3m (2018: GBP0.1m) is made up of
GBP0.2m relating to IFRS16 interest charges and a GBP0.1m net
interest charge for the defined contribution pension scheme.
Profit Before Tax (PBT)
Profit Before Tax was GBP32.4m for the year, an increase of 2.1%
compared to the prior year (2018: GBP31.8m).
The margin return on sales was 22.1% compared to 22.4% in the
prior year.
Taxation
The effective rate of Corporation Tax for Nichols plc in 2019
was 17.2% (2018: 19.6%). This is lower than the standard rate of
19%.
Nichols plc repatriates all worldwide profit to the United
Kingdom.
Statement of Financial Position
The Group cash balance at the end of 2019 was GBP40.9m (2018:
GBP38.9m).
Nichols plc's business model continues to be very cash
generative, the operating profit cash conversion was 105% (2018:
91%). The cash conversion metric is calculated as 'net cash
generated from operating activities' as a percentage of 'profit for
the financial year'.
By exception, other points of note regarding the Statement of
Financial Position are as follows:
-- There has been a significant increase in the value of
property, plant and equipment during the year. The NBV at the
year-end was GBP21.7m compared to GBP14.6m in 2018. Increased
investment in freezer equipment to support the growth in our Out of
Home business (GBP4.0m) and leased assets capitalised (GBP4.6m) due
to the adoption of IFRS 16, as mentioned elsewhere, are the key
contributors to this increase.
-- The increase in goodwill of GBP4.1m is due to the acquisition
of AML referred to above. The total carrying value of goodwill at
the year end was GBP38.6m (2018: GBP34.5m).
-- Inventories of GBP8.3m were held at the year end (2018:
GBP7.2m), an increase of 16.7%. GBP0.3m of the increase is due to
the inclusion of stocks owned by AML following the acquisition.
-- Non-current liabilities - Trade and other payables. The
balance of GBP3.0m is largely the recognition of lease liabilities
as part of adopting IFRS 16 during the year.
-- It is pleasing to see the pension obligation has reduced to
GBP0.3m (2018: GBP2.8m). The reduction in the pension obligation is
due to a significant increase in the fair value of the scheme's
assets during the year.
KEY PERFORMANCE INDICATORS
The following Key Performance Indicators are used by management
to monitor the Group's profit performance:
Revenue Growth +3.5% (2018: +7.0%)
The increase in the current year's revenue as a percentage of
the prior year's value.
Gross Margin 47.6% (2018: 45.7%)
Gross Profit as a percentage of revenue. This KPI is monitored
at segment (Still and Carbonate) and product level.
Operating Profit Margin 22.1% (2018: 22.3%)
Group profit before financing income or expense as a percentage
of revenue. This is considered for the Group as a whole rather than
at product level.
EBITDA GBP37.0m (2018: GBP33.8m)
EBITDA is defined as profit before interest, tax, depreciation
and amortisation.
As mentioned above, Nichols has adopted IFRS16 during the year,
which has a positive effect on EBITDA, by adding back the expense
previously referred to as operating lease charges. Therefore, the
accounting change distorts the year on year comparison during this
year of transition. Without the IFRS 16 change, 2019 EBITDA would
have been GBP35.8m.
Tim Croston
Chief Financial Officer
25 February 2020
Consolidated income statement
Year ended 31 December 2019
2019 2018
Total Total
GBP'000 GBP'000
Revenue 146,985 142,037
Cost of sales (77,027) (77,170)
------------------------------ --------- -------------
Gross profit 69,958 64,867
Distribution expenses (7,423) (7,236)
Administrative expenses (30,096) (25,993)
------------------------------ --------- -------------
Operating profit 32,439 31,638
Finance income 235 192
Finance expense (252) (77)
Profit before taxation 32,422 31,753
Taxation (5,587) (6,238)
------------------------------ --------- -------------
Profit for the financial
year 26,835 25,515
------------------------------ --------- -------------
Earnings per share (basic) 72.81p 69.23p
Earnings per share (diluted) 72.77p 69.19p
All results relate to continuing operations.
Consolidated statement of comprehensive income
Year ended 31 December 2019
2019 2018
GBP'000 GBP'000
Profit for the financial year 26,835 25,515
Items that will not be reclassified
subsequently to profit or loss
Re-measurement of net defined
benefit liability 1,704 (412)
Deferred taxation on pension obligations
and employee benefits (297) (44)
Other comprehensive income/ (expense)
for the year 1,407 (456)
Total comprehensive income for
the year 28,242 25,059
Statement of financial position
Year ended 31 December 2019
Group Parent
2019 2018 2019 2018
ASSETS GBP'000 GBP'000 GBP'000 GBP'000
Non-current assets
Property, plant and equipment 21,742 14,572 7,098 4,430
Goodwill 38,585 34,451 2,504 2,504
Investments - - 16,566 16,566
Intangibles 8,065 7,748 1,316 1,316
Deferred tax assets 283 835 283 835
----------------------------------- -------- -------- -------- --------
Total non-current assets 68,675 57,606 27,767 25,651
Current assets
Inventories 8,361 7,164 4,402 3,894
Trade and other receivables 38,363 38,153 40,227 35,239
Cash and cash equivalents 40,944 38,896 20,094 20,070
----------------------------------- -------- -------- -------- --------
Total current assets 87,668 84,213 64,723 59,203
----------------------------------- -------- -------- -------- --------
Total assets 156,343 141,819 92,490 84,854
----------------------------------- -------- -------- -------- --------
LIABILITIES
Current liabilities
Trade and other payables 23,260 22,339 29,411 22,248
Current tax liabilities 2,675 2,814 99 391
Total current liabilities 25,935 25,153 29,510 22,639
Non-current liabilities
Other payables 3,028 - 1,791 -
Pension obligations and employee
benefits 253 2,755 253 2,755
Deferred tax liabilities 1,785 1,801 - -
-------- -------- -------- --------
Total non-current liabilities 5,066 4,556 2,044 2,755
Total liabilities 31,001 29,709 31,554 25,394
----------------------------------- -------- -------- -------- --------
Net assets 125,342 112,110 60,936 59,460
----------------------------------- -------- -------- -------- --------
EQUITY
Share capital 3,697 3,697 3,697 3,697
Share premium reserve 3,255 3,255 3,255 3,255
Capital redemption reserve 1,209 1,209 1,209 1,209
Other reserves 253 666 1,028 1,441
Retained earnings 116,928 103,283 51,747 49,858
Total equity 125,342 112,110 60,936 59,460
----------------------------------- -------- -------- -------- --------
Consolidated statement of cash flows
Year ended 31 December 2019
2019 2018
GBP'000 GBP'000 GBP'000 GBP'000
Cash flows from operating activities
Profit for the financial year 26,835 25,515
Adjustments for:
Depreciation and amortisation 4,541 2,179
Loss on sale of property, plant and
equipment 19 127
Finance income (235) (192)
Finance expense 252 77
Tax expense recognised in the income
statement 5,587 6,238
Change in inventories (925) (2,274)
Change in trade and other receivables 1,263 (3,347)
Change in trade and other payables (2,462) 1,197
Change in pension obligations (798) (578)
7,242 3,427
Cash generated from operating activities 34,077 28,942
Tax paid (5,888) (5,679)
--------- -----------
Net cash generated from operating
activities 28,189 23,263
Cash flows from investing activities
Finance income 235 192
Proceeds from sale of property, plant 11 -
and equipment
Acquisition of property, plant and
equipment (5,910) (3,857)
Acquisition of trade and assets - (143)
Acquisition of subsidiary (4,893) (3,814)
Net cash used in investing activities (10,557) (7,622)
Cash flows from financing activities
Payment of lease liabilities (1,118) -
Dividends paid (14,466) (12,803)
-------------------------------------------- ---------- --------- --------- -----------
Net cash used in financing activities (15,584) (12,803)
Net increase in cash and cash equivalents 2,048 2,838
Cash and cash equivalents at 1 January 38,896 36,058
-------------------------------------------- ---------- --------- --------- -----------
Cash and cash equivalents at 31 December 40,944 38,896
-------------------------------------------- ---------- --------- --------- -----------
Consolidated statement of changes in equity
Year ended 31 December 2019
Called Share Capital Other Retained Total
up share premium redemption reserves earnings equity
capital reserve reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 January 2018 3,697 3,255 1,209 134 91,027 99,322
Dividends - - - - (12,803) (12,803)
Movement in ESOT - - - 23 - 23
Credit to equity for
equity-settled share
based payments - - - 509 - 509
Transactions with owners - - - 532 (12,803) (12,271)
-------------------------- ---------- --------- ------------ ---------- ---------- ---------
Profit for the year - - - - 25,515 25,515
Other comprehensive
expense - - - - (456) (456)
-------------------------- ---------- --------- ------------ ---------- ---------- ---------
Total comprehensive
income - - - - 25,059 25,059
-------------------------- ---------- --------- ------------ ---------- ---------- ---------
At 1 January 2019 3,697 3,255 1,209 666 103,283 112,110
Dividends - - - - (14,466) (14,466)
Movement in ESOT - - - (214) - (214)
Debit to equity for
equity-settled share
based payments - - - (199) - (199)
Movement in deferred
tax - - - - (131) (131)
Transactions with owners - - - (413) (14,597) (15,010)
-------------------------- ---------- --------- ------------ ---------- ---------- ---------
Profit for the year - - - - 26,835 26,835
Other comprehensive
income - - - - 1,407 1,407
-------------------------- ---------- --------- ------------ ---------- ---------- ---------
Total comprehensive
income - - - - 28,242 28,242
-------------------------- ---------- --------- ------------ ---------- ---------- ---------
At 31 December 2019 3,697 3,255 1,209 253 116,928 125,342
-------------------------- ---------- --------- ------------ ---------- ---------- ---------
Nichols plc
NOTES TO THE PRELIMINARY FINANCIAL INFORMATION
Basis of preparation
The preliminary financial information does not constitute
statutory accounts for the financial years ended 31 December 2019
and 31 December 2018, but has been derived from those accounts.
With effect from 1 January 2019, the Group has implemented two new
accounting standards; IFRS 16, Leases and IFRIC 23, Uncertainty
Over Tax Treatments. All other accounting policies remained
unchanged from those set out in the 2018 annual report.
The adoption of IFRS 16 has resulted in the Group identifying
non-cancellable operating lease commitments relating to property
leases for operational sites and motor vehicles. The Group has
applied the modified retrospective transition approach to its
leases with effect from 1 January 2019, whereby the asset and
liability values recognised are equal to one another, with no
adjustment to opening reserves. The impact of adopting IFRS 16 on a
modified retrospective basis was therefore to recognise a
right-of-use asset and a lease liability of GBP3.1m at 1 January
2019.
IFRIC 23 provides guidance on the accounting for current and
deferred tax liabilities and assets in circumstances in which there
is uncertainty over income tax treatments. The Group elected to
apply IFRIC 23 retrospectively with the cumulative effect recorded
in retained earnings as at the date of initial application, being 1
January 2019. The adoption of IFRIC 23 has had no material effect
on transition.
Statutory accounts for 2018 have been delivered to the Registrar
of Companies and those for the financial year ended 31 December
2019 will be delivered following the Company's Annual General
Meeting. The auditors have reported on those accounts and their
reports were unqualified, did not draw attention to any matters by
way of emphasis, and did not contain a statement under 498(2) or
498(3) of the Companies Act 2006.
Earnings per share
The calculation of basic earnings per share is based on earnings
attributable to ordinary shareholders divided by the weighted
average number of shares in issue during the year. Shares held in
the Employee Share Ownership Trust and Employee Benefit Trust are
treated as cancelled for the purposes of this calculation.
The calculation of diluted earnings per share is based on the
basic earnings per share adjusted to allow for the assumed
conversion of all dilutive options.
Basic earnings per share is 72.81 pence (2018: 69.23 pence).
Segmental information
The Board analyses the Group's internal reports to enable an
assessment of performance and allocation of resources. The
operating segments are based on these reports.
The Board considers the business from a product perspective and
reviews the Group on the operating segments identified below. There
has been no change to the segments during the year. Based on the
nature of the products sold by the Group, the types of customers
and methods of distribution, management consider reporting
operating segments at the Still and Carbonate level to be
reasonable. Gross profit is the measure used to assess the
performance of each operating segment as identified as a KPI in the
annual report.
Revenue Gross Profit
2019 2018 2019 2018
GBP'000 GBP'000 GBP'000 GBP'000
Still 71,661 64,683 42,712 35,398
Carbonate 75,324 77,354 27,246 29,469
Total 146,985 142,037 69,958 64,867
There are no sales between the two operating segments, and all
revenue is earned from external customers.
The operating segments gross profit is reconciled to profit
before taxation as per the consolidated income statement.
The Group's assets are managed centrally by the Board and
consequently there is no reconciliation between the Group's assets
per the statement of financial position and the segment assets.
Annual report
The annual report will be mailed to shareholders and made
available on our website on or around 16 March 2020. Copies will be
available after that date from: The Secretary, Nichols plc, Laurel
House, Woodlands Park, Ashton Road, Newton-le-Willows, WA12
0HH.
Annual General Meeting
The Annual General Meeting will be held at Nichols plc, Laurel
House, Woodlands Park, Ashton Road, Newton-le-Willows, WA12 0HH on
Wednesday 29 April 2020 at 11.00am.
Copies of the announcement can be found on the Investor
Relations section of the Company's website:
www.nicholsplc.co.uk.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR TAMFTMTJTBRM
(END) Dow Jones Newswires
February 26, 2020 02:00 ET (07:00 GMT)
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