BILLINGTON HOLDINGS PLC

Earnings Release • Sep 9, 2014

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RNS Number : 1328R

Billington Holdings PLC

09 September 2014

Press Release                                                                                 9 September 2014

Billington Holdings Plc

Billington Holdings Plc

('Billington', 'the Group' or 'the Company')

Interim Results

Billington Holdings Plc (AIM: BILN), one of the UK's leading structural steel and construction safety solutions specialists, today announces its interim results for the six months ended 30 June 2014.

	Unaudited six months to 30 June 2014	Unaudited six months to 30 June 2013	Percentage increase
Revenue	£23.20m	£17.16m	+35%
Adjusted EBITDA¹	£1.18m	£0.82m	+44%
Profit  before tax¹	£0.79m	£0.34m	+132%
Cash and cash equivalents	£2.80m	£0.42m	+567%
Earnings per share from continuing operations	4.9p	1.6p	+206%

¹ Adjusted for redundancy costs

Highlights

·      Strong results - underpinned by the Group's 'stability and return to profitability' initiative

·     Board remains confident of further progress and believes that the Group is well positioned to benefit from improving market conditions

- full year results anticipated to be ahead of current forecasts

- Board to consider dividend declaration when full year results are announced in March 2015

Commenting on the results, Steve Fareham, Chief Executive, said,

"This is a strong set of results, which continues our recent trend of improving performance. The figures are underpinned by our 'stability and return to profitability' initiative.  The first half of 2014 has seen real signs of improvement in the structural sector and we anticipate that our specialist divisions will demonstrate corresponding improvements in the second half.  It is expected that the result for the full year will be ahead of the current forecast. 

"Looking ahead, the Board is confident of further progress in the Company's trading performance; we believe that the strength of the Company's balance sheet, our strategy and our proven track record make Billington well positioned to benefit from improving market conditions and the new opportunities therein."

For further information please contact:

Billington Holdings Plc                                                                        Tel:      01226 340666

Peter Hems

Non-Executive Chairman

Steve Fareham

Chief Executive

Blytheweigh                                                                                        Tel:        020 7138 3204

Tim Blythe                                                                                             Mob:     07816 924626

Alex Shilov                                                                                            Mob:      07989 394027

W H Ireland Limited                                                                            Tel:        0161 819 8875

Katy Mitchell

Chief Executive's Statement

Introduction

I am pleased to report that Billington has posted a strong set of results for the six months to 30 June 2014, with revenues up 35 per cent and profit before tax increasing more than threefold year on year. The continuing progress in the Group's financial performance is underpinned by our 'stability and return to profitability' initiative.

Results

Profit before tax for the six months to 30 June 2014 was £0.8 million, after adjusting for redundancy costs (2013: £0.3 million, after adjusting for redundancy costs incurred in the period of £0.1 million). 

Group revenue for the period was £23 million (2013: £17 million), with the increase largely attributable to a number of larger projects being completed in the period along with a greater number and quantum of associated sub trade packages within our scope of works.

Businesses

Structural Steel

Based in Barnsley and Bristol, Billington Structures' primary activity is the design, fabrication and erection of structural steelwork for a wide variety of sectors, mostly to the UK construction industry. In the first half of 2014, we have successfully delivered projects into a broad range of market sectors. We have also added to our previously reported work in Scandinavia, with further projects having been secured and completed in the period.

Tubecon, our specialist tubular and complex steelwork division, has completed several major projects and is now seeking new opportunities while complementing our conventional product range.

We have several potential projects in the pipeline with our joint venture with Bourne Construction, BS2.

Recent improvements in the sector have yet to filter through to our Leeds based Peter Marshall Steel Stairs division but we do remain optimistic that projects will be secured in the second half of 2014.

Safety Solutions

Based in Tuxford, North Nottinghamshire, easi-edge's main business is to hire out our patented safety barriers to the UK steel and timber frame construction industries. Following the trading pattern of the previous financial year, the start of 2014 proved slower but, with the clear improvements seen in the structural steel market, our utilisation has grown steadily in the second quarter and forecasts for the third and fourth quarters look strong. We have seen further improvements in our work within the timber frame sector and when dealing directly with main contractors.     

Being the first specialist on a construction site, our innovative and sustainable site hoardings division, hoard-it, headquartered in Barnsley, has benefitted from the increase in UK construction activity and has supplied hoardings in many major cities including Edinburgh, Liverpool and London. New products have been introduced to develop onsite customer marketing activities.

Earnings per Share

Earnings per share from continuing operations stood at 4.9 pence in the period, compared with earnings per share of 1.6 pence for the corresponding period in 2013.

Liquidity and Capital Resources

The Group had a cash balance of £2.8 million at 30 June 2014 (2013: £417,000). The net cash flow from operating activities during the period amounted to an inflow of £0.2 million (2013: outflow of £0.6 million). Capital expenditure was £0.5 million in the period (2013: £0.1 million). The increase in asset purchases is primarily the result of extending the hire fleet of the Group's hoarding product in the period.

With confidence continuing to return in the economy as a whole, the Board considers that having a strong balance sheet with adequate available cash resources and funding facilities enables the Group to be well placed to take advantage of the apparent, albeit slow, economic recovery.

Pension

The Group's remaining final salary pension scheme is currently concluding its latest triennial valuation. Additional pension contributions of £0.1 million were paid to the scheme in the six months to June 2014 (2013: nil). The Group remains committed to the scheme and to achieving its overall objective of realising the buyout funding level.

Prospects and dividend

The first half of 2014 has seen real signs of improvement in the structural sector and we anticipate that our specialist divisions will demonstrate corresponding improvements in the second half.

CE marking, a key indicator of a product's compliance with EU legislation, was introduced to the structural steelwork industry this summer; Billington complies with CE marking and this will help to differentiate us further from our peers as we explore new opportunities. 

Looking ahead, the Board is confident of further progress in the Company's trading performance; we believe that the strength of the Company's balance sheet, our strategy and our proven track record make Billington well positioned to benefit from improving market conditions and the new opportunities therein. 

It is anticipated that the result for the full year will be ahead of the current forecast.  The Board has previously indicated its intention to recommence the payment of a dividend at the appropriate time.  With optimism within the wider UK economy continuing to improve and in view of the anticipated result for the full year, the Board has decided that it is appropriate to give an indication at this stage that it intends to give serious consideration to the declaration of a dividend when the full year results are announced in March 2015.  The final decision will depend on the anticipated cash requirements of the business as activity levels increase and capital expenditure plans on replacement of plant and equipment are clarified.

Board and Employees

I would like to take this opportunity to welcome Mark Smith to the Board as Chief Operating Officer.  Mark's expertise, enthusiasm and support are already being seen in all of our trading sectors.

Finally, I would like to thank my colleagues on the Board, all of our loyal employees and stakeholders for their continued support and dedication through what was a very challenging and long recession and I look forward to working together to continue growing our business.

Steve Fareham

Chief Executive Officer

8 September 2014   

Condensed consolidated interim income statement
Six months ended 30th June 2014
		Unaudited		Unaudited		Audited
		Six months		Six months		Twelve months
		to 30th June		to 30th June		to 31st December
		2014		2013		2013
		£000		£000		£000
Continuing operations
Revenue		23,200		17,156		37,571
(Decrease)/increase in work in progress		(1,886)		1,310		1,833
		21,314		18,466		39,404
Raw material and consumables		13,212		10,274		22,988
Other external charges		1,458		1,475		3,058
Staff costs		4,952		5,109		10,182
Redundancy		27		88		209
Depreciation		384		467		857
Other operating charges		515		791		1,373
		20,548		18,204		38,667
Group operating profit		766		262		737
Share of post tax profit in joint ventures		0		0		0
Total operating profit		766		262		737
Net finance cost		(7)		(10)		(17)
Profit before tax		759		252		720
Tax		(190)		(63)		(256)
Profit for the period from continuing operations and attributable to equity holders of the parent company		569		189		464
Earnings per share (basic and diluted) from continuing operations		4.9 p		1.6 p		4.0 p
Dividends per share		0.00 p		0.00 p		0.00 p
Earnings per ordinary share has been calculated on the basis of the result for the period after tax, divided by the weighted average number of ordinary shares in issue in the period, excluding those held in the ESOP Trust, of 11,580,808. The comparatives are calculated by reference to the weighted average number of ordinary shares in issue which were 11,580,808 for the period to 30 June 2013 and 11,580,808 for the year ended 31 December 2013.

Condensed consolidated interim balance sheet
As at 30th June 2014
	Unaudited		Unaudited		Audited
	30th June		30th June		31st December
	2014		2013		2013
	£000		£000		£000
Assets
Non current assets
Property, plant and equipment	7,698		7,670		7,629
Pension assets	653		384		653
Investment in joint ventures	0		0		0
Deferred tax asset	621		878		621
Total non current assets	8,972		8,932		8,903
Current assets
Inventories and work in progress	6,034		7,246		7,915
Trade and other receivables	5,785		3,973		4,411
Cash and cash equivalents	2,809		417		2,576
Total current assets	14,628		11,636		14,902
Total assets	23,600		20,568		23,805
Liabilities
Current liabilities
Current portion of long term borrowings	346		45		368
Trade and other payables	9,570		7,626		10,512
Current tax payable	229		63		39
Total current liabilities	10,145		7,734		10,919
Non current liabilities
Long term borrowings	0		346		0
Total non current liabilities	0		346		0
Total liabilities	10,145		8,080		10,919
Net assets	13,455		12,488		12,886
Equity
Share capital	1,293		1,293		1,293
Share premium	1,864		1,864		1,864
Capital redemption reserve	132		132		132
Other reserve	(909)		(909)		(909)
Accumulated profits	11,075		10,108		10,506
Total equity	13,455		12,488		12,886

Condensed consolidated interim statement of comprehensive income
Six months ended 30th June 2014
		Unaudited		Unaudited		Audited
		Six months		Six months		Twelve months
		to 30th June		to 30th June		to 31st December
		2014		2013		2013
		£000		£000		£000
Profit for the period		569		189		464
Other comprehensive income
	Remeasurement of net defined benefit surplus	0		0		163
	Movement on deferred tax relating to pension liability	0		0		(65)
	Current tax relating to pension liability	0		0		25
Other comprehensive income, net of tax		0		0		123
Total comprehensive income for the period attributable to equity holders of the parent company		569		189		587

Condensed consolidated interim statement of changes in equity (Unaudited)
	Share	Share	Capital	Other	Accumulated	Total
	capital	premium	redemption	reserve -	profits	equity
		account	reserve	ESOP
	£000	£000	£000	£000	£000	£000
At 1st January 2013	1,293	1,864	132	(909)	9,919	12,299
Transactions with owners	0	0	0	0	0	0
Profit for the six months to 30th June 2013	0	0	0	0	189	189
Total comprehensive income for the period	0	0	0	0	189	189
At 30th June 2013	1,293	1,864	132	(909)	10,108	12,488
At 1st July 2013	1,293	1,864	132	(909)	10,108	12,488
Transactions with owners
ESOP movement in period	0	0	0	0	0	0
Transactions with owners	0	0	0	0	0	0
Profit for the six months to 31st December 2013	0	0	0	0	275	275
Other comprehensive income
Actuarial gain recognised in the pension scheme	0	0	0	0	163	163
Income tax relating to components of other comprehensive income	0	0	0	0	(40)	(40)
Total comprehensive income for the period	0	0	0	0	398	398
At 31st December 2013	1,293	1,864	132	(909)	10,506	12,886
At 1st January 2014	1,293	1,864	132	(909)	10,506	12,886
Transactions with owners	0	0	0	0	0	0
Profit for the six months to 30th June 2014	0	0	0	0	569	569
Total comprehensive income for the period	0	0	0	0	569	569
At 30th June 2014	1,293	1,864	132	(909)	11,075	13,455

Condensed consolidated interim cash flow statement Six months ended 30th June 2014
		Unaudited		Unaudited		Audited
		Six months		Six months		Twelve months
		to 30th June		to 30th June		to 31st December
		2014		2013		2013
		£000		£000		£000
Cash flows from operating activities
Group profit after tax		569		189		464
Tax paid		0		0		0
Interest received		0		0		0
Depreciation on property, plant and equipment		384		467		857
Difference between pension charge and cash  contributions		(133)		0		(106)
Profit on sale of property, plant and equipment		(32)		(58)		(110)
Taxation charge recognised in income statement		190		63		256
Net finance expense		7		10		17
Decrease/(increase)in inventories and work in progress		1,881		(1,349)		(2,018)
(Increase)/decrease in trade and other receivables		(1,241)		245		(193)
(Decrease)/increase in trade and other payables		(942)		(120)		2,766
Net cash flow from operating activities		683		(553)		1,933
Cash flows from investing activities
Purchase of property, plant and equipment		(455)		(74)		(449)
Proceeds from sale of property, plant and equipment		34		64		142
Net cash flow from investing activities		(421)		(10)		(307)
Cash flows from financing activities
Interest paid		(7)		(10)		(17)
Repayment of bank and other loans		(22)		(22)		(45)
Net cash flow from financing activities		(29)		(32)		(62)
Net decrease in cash and cash equivalents		233		(595)		1,564
Cash and cash equivalents at beginning of period		2,576		1,012		1,012
Cash and cash equivalents at end of period		2,809		417		2,576

Notes to the interim accounts - as at 30 June 2014

Segmental Reporting

The continuing operations of Billington Holdings plc operate only in Structural Steel. The Structural Steel segment includes the activities of Billington Structures Limited, Peter Marshall Steel Stairs Limited and easi-edge Limited. The Group activities, comprising services and assets provided to Group companies and a small element of external property rentals and management charges, are considered incidental to the activities of Billington Structures Limited and have therefore not been shown as a separate operating segment but have been subsumed with Structural Steel.  All assets of the Group reside in the UK.

Basis of preparation

These consolidated interim financial statements are for the six months ended 30 June 2014.  They have been prepared with regard to the requirements of IFRS. The financial information set out in these consolidated interim financial statements does not constitute statutory accounts as defined in S434 of the Companies Act 2006.  They do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements of the Group for the year ended 31 December 2013 which contained an unqualified audit report and have been filed with the Registrar of Companies.  They did not contain statements under S498 of the Companies Act 2006.

These consolidated interim financial statements have been prepared under the historical cost convention. The accounting policies have been applied consistently throughout the Group for the purposes of preparation of these consolidated interim financial statements.  

Dividends

In the first half of 2014 Billington Holdings Plc has not declared a final dividend in respect of 2013 to its equity shareholders (2013: nil).  No interim dividend for 2014 has been declared (2013: nil).

These results were approved by the Board of Directors on 8 September 2014.

This information is provided by RNS

The company news service from the London Stock Exchange

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