LATHAM (JAMES) PLC

Interim / Quarterly Report • Nov 26, 2015

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RNS Number : 9972G

Latham(James) PLC

26 November 2015

James Latham plc

("James Latham" or the "Company")

HALF YEARLY RESULTS FOR THE PERIOD ENDED 30 SEPTEMBER 2015 

Chairman's statement

I am pleased to report good results for the six months to 30 September 2015.

Results

The results are better than the same period last year.  Revenue for the six months to 30 September 2015 was £96.2m, up 8.0 per cent on £89.1m for the same period last year.  The operating profit was £6.5m, 20.4 per cent up on £5.4m last year.  Finance costs were £227,000 (2014: £263,000), reflecting reduced interest charges on the lower pension scheme deficit.  Profit before tax was £6.3m, up 21.2 per cent on last year's £5.2m.  Earnings per ordinary share were 25.8p (2014: 20.5p) an increase of 25.9 per cent.

As at 30 September 2015 shareholder funds had increased to £67.8m (2014: £63.3m) with cash and cash equivalents of £12.4m (2014: £12.6m).

Interim dividend

The Board has declared an increased interim dividend of 4.0p per Ordinary Share (2014: 3.7p), which is covered 6.5 times (2014: 5.5 times).  The dividend is payable on 29 January 2016 to ordinary shareholders on the Company's Register at close of business on 8 January 2016.  The ex-dividend date will be 7 January 2016.

Six months trading to 30 September 2015

In trading conditions which have been different for the various markets that we serve, group revenue has grown by £7.1m, as a result of higher sales volumes and product mix, which offset lower prices.  This growth was both in panel products and timber, with increased sales in decorative panels, doors, Accoya® and WoodEx, our engineered wood sections.

Trading margins for the six months to 30 September 2015 are similar to the previous year, with an improvement in panels and a small decline in timber.  Overheads have been controlled, with higher warehouse and distribution costs reflecting higher volumes handled and the extended working day at a number of depots.  Bad debts have been significantly lower than previous periods.  We continue to take advantage of cash settlement discounts from suppliers where this represents a good return.

Current and future trading

Management information shows growing revenue for October and the first half of November, at slightly improved margins.  Market conditions continue to be difficult in some areas, while improving in others. We are in a good position with our wide range of customers and we are trading comfortably in line with market expectations.  We are progressing with our plans to relocate our two oldest depots. We are close to agreeing heads of terms on the new Yate site and are in negotiations for the new Wigston site.

Future management

From 1 January 2016 I will become non-executive Chairman of James Latham PLC rather than executive Chairman and Nick Latham will take up the majority of my executive duties. I will continue as a director of the Programme for the Endorsement of Forest Certification (PEFC).

Peter Latham

Chairman

26 November 2015

Enquiries

James Latham plc	Tel:  01442 849 100
Peter Latham, Chairman
David Dunmow, Finance Director
Northland Capital Partners Limited  Nominated Adviser and Broker	Tel:  020 7382 1100
Matthew Johnson / Edward Hutton

JAMES LATHAM PLC
CONSOLIDATED INCOME STATEMENT
For the six months to 30 September 2015
	Six months to 30 Sept. 2015 unaudited	Six months to 30 Sept. 2014 unaudited	Year to 31 March 2015 audited
	£000	£000	£000
Revenue	96,209	89,120	174,855
Cost of sales (including warehouse costs)	(78,975)	(73,281)	(143,978)
Gross profit	17,234	15,839	30,877
Selling and distribution costs	(7,674)	(7,031)	(14,082)
Administrative expenses	(3,102)	(3,392)	(6,237)
Other operating income	3	3	6
Operating profit	6,461	5,419	10,564
Finance income	25	21	46
Finance costs	(227)	(263)	(503)
Profit before tax	6,259	5,177	10,107
Tax expense	(1,257)	(1,209)	(2,285)
Profit after tax attributable to owners of the parent company	5,002	3,968	7,822
Earnings  per ordinary share (basic)	25.8p	20.5p	40.3p
Earnings  per ordinary share (diluted)	25.5p	20.3p	40.0p
All results relate to continuing operations.

JAMES LATHAM PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six months to 30 September 2015
	Six months to 30 Sept. 2015 unaudited	Six months to 30 Sept. 2014 unaudited	Year to 31 March 2015 audited
	£000	£000	£000
Profit after tax	5,002	3,968	7,822
Other Comprehensive income
Actuarial gains/(losses) on defined benefit pension scheme	2,766	3,492	(1,849)
Deferred tax relating to components of other comprehensive income	(491)	(661)	434
Other comprehensive income for the period, net of tax	2,275	2,831	(1,415)
Total comprehensive income, attributable to owners of the parent company	7,277	6,799	6,407

JAMES LATHAM PLC
CONSOLIDATED BALANCE SHEET
At 30 September 2015
	As at 30 Sept. 2015 unaudited	As at 30 Sept. 2014 unaudited	As at 31 March 2015 audited
	£000	£000	£000
ASSETS
Non-current assets
Goodwill	237	237	237
Intangible assets	97	104	101
Property, plant and equipment	21,477	22,056	21,601
Total non-current assets	21,811	22,397	21,939
Current assets
Inventories	32,419	28,639	31,906
Trade and other receivables	37,612	35,617	34,213
Cash and cash equivalents	12,432	12,592	12,501
Total current assets	82,463	76,848	78,620
Total assets	104,274	99,245	100,559
Current liabilities
Trade and other payables	24,917	25,278	23,893
Current portion of interest bearing loans and borrowings	-	242	907
Current tax payable	1,297	1,005	947
Total current liabilities	26,214	26,525	25,747
Non-current liabilities
Interest bearing loans and borrowings	987	1,768	987
Retirement and other benefit obligation	7,679	5,473	10,430
Other payables	435	492	464
Deferred tax liabilities	1,188	1,649	700
Total non-current liabilities	10,289	9,382	12,581
Total liabilities	36,503	35,907	38,328
Net assets	67,771	63,338	62,231
Capital and reserves
Issued capital	5,040	5,040	5,040
Share-based payment reserve	172	152	143
Own shares	(235)	(226)	(177)
Capital reserve	3	3	3
Retained earnings	62,791	58,369	57,222
Total equity attributable to owners of the parent company	67,771	63,338	62,231

JAMES LATHAM PLC
CONSOLIDATED CASH FLOW STATEMENT
For the six months to 30 September 2015
	Six months to 30 Sept 2015 unaudited	Six months to 30 Sept 2014 unaudited	Year to 31 March 2015 audited
	£000	£000	£000
Net cash flow from operating activities
Cash generated from operations	4,055	4,211	6,218
Interest paid	(25)	(24)	(44)
Income tax paid	(909)	(1,007)	(1,996)
Net cash inflow from operating activities	3,121	3,180	4,178
Cash flows from investing activities
Interest received and similar income	25	21	46
Purchase of property, plant and equipment	(608)	(137)	(383)
Proceeds from sale of property, plant and equipment	46	-	6
Net cash outflow from investing activities	(537)	(116)	(331)
Cash flows before financing activities
Borrowings repaid during the period	(907)	(118)	(234)
Equity dividends paid	(1,707)	(1,549)	(2,267)
Preference dividend paid	(39)	(39)	(79)
Net cash outflow from financing activities	(2,653)	(1,706)	(2,580)
(Decrease)/increase in cash and cash equivalents for the period	(69)	1,358	1,267
Cash and cash equivalents at beginning of the period	12,501	11,234	11,234
Cash and cash equivalents at end of the period	12,432	12,592	12,501

JAMES LATHAM PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Attributable to owners of the parent company
	Issued capital £000	Share-based payment reserve  £000	Own shares £000	Capital reserve £000	Retained earnings £000	Total equity £000
As at 1 April 2014 (audited)	5,040	123	(175)	3	53,117	58,108
Profit for the period	-	-	-	-	3,968	3,968
Other comprehensive income:
Actuarial gain on defined benefit pension scheme	-	-	-	-	3,492	3,492
Deferred tax relating to components of other comprehensive income	-	-	-	-	(661)	(661)
Total comprehensive income for the year	-	-	-	-	6,799	6,799
Transaction with owners:
Dividends	-	-	-	-	(1,549)	(1,549)
Write down on conversions of ESOP shares	-	-	2	-	(2)	-
Exercise of options	-	(4)	-	-	4	-
Change in investment in ESOP shares	-	-	(53)	-	-	(53)
Share-based payment expense	-	33	-	-	-	33
Total transactions with owners	-	29	(51)	-	(1,547)	(1,569)
Balance at 30 September 2014 (unaudited)	5,040	152	(226)	3	58,369	63,338
Profit for the period	-	-	-	-	3,854	3,854
Other comprehensive income:
Actuarial loss on defined benefit pension scheme	-	-	-	-	(5,341)	(5,341)
Deferred tax relating to components of other comprehensive income	-	-	-	-	1,095	1,095
Total comprehensive income for the period	-	-	-	-	(392)	(392)
Transactions with owners:
Dividends	-	-	-	-	(718)	(718)
Write down on conversions of ESOP shares	-	-	80	-	(80)	-
Exercise of options	-	(43)	-	-	43	-
Change in investment in ESOP shares	-	-	(31)	-	-	(31)
Share-based payment expense	-	34	-	-	-	34
Total transactions with owners	-	(9)	49	-	(755)	(715)
Balance at 31 March 2015 (audited)	5,040	143	(177)	3	57,222	62,231
Profit for the period	-	-	-	-	5,002	5,002
Other comprehensive income:
Actuarial gain on defined benefit pension scheme	-	-	-	-	2,766	2,766
Deferred tax relating to components of other comprehensive income	-	-	-	-	(491)	(491)
Total comprehensive income for the period	-	-	-	-	7,277	7,277
Transactions with owners:
Dividends	-	-	-	-	(1,707)	(1,707)
Write down on conversions of ESOP shares	-	-	1	-	(1)	-
Change in investment in ESOP shares	-	-	(59)	-	-	(59)
Share-based payment expense	-	29	-	-	-	29
Total transactions with owners	-	29	(58)	-	(1,708)	(1,737)
Balance at 30 September 2015 (unaudited)	5,040	172	(235)	3	62,791	67,771

JAMES LATHAM PLC
NOTES TO THE HALF YEARLY REPORT
1. The results presented in this report are unaudited and they have been prepared in accordance with the recognition and measurement of International Financial Reporting Standards ('IFRS') as adopted by the EU that are expected to be applicable to the financial statements for the year ending 31 March 2016 and on the basis of the accounting policies to be used in those financial statements.  The figures for the year ended 31 March 2015 are extracted from the statutory accounts of the group for that period.
2.  The directors propose an interim dividend of 4.0p per ordinary share which will absorb £780,000 (2015: 3.7p absorbing £720,000), payable on 29 January 2016 to shareholders on the Register at the close of business on 8 January 2016. The ex-dividend date is 7 January 2016.
3. This half yearly report does not constitute financial statutory accounts within the meaning of section 434 of the Companies Act 2006. The statutory accounts for the year ended 31 March 2015 were filed with the Registrar of Companies.  The audit report on those financial statements was not qualified and did not contain a reference to any matters which the auditor drew attention by way of emphasis without qualifying the report and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.  The half yearly report has not been audited by the company's auditor.
4.  Earnings per ordinary share is calculated by dividing the net profit for the year attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the year.
	Six months to 30 Sept 2015 unaudited	Six months to 30 Sept 2014 unaudited	Year to 31 March 2015 audited
	£000	£000	£000
Net profit attributable to ordinary shareholders	5,002	3,968	7,822
	Number '000	Number '000	Number '000
Weighted average share capital	19,399	19,393	19,389
Add: diluted effect of share capital options issued	203	196	169
Weighted average share capital for diluted earnings per ordinary share calculation	19,602	19,589	19,558

5.  Net cash flow from operating activities
	Six months to 30 Sept 2015 unaudited	Six months to 30 Sept 2014 unaudited	Year to 31 March 2015 audited
Profit before tax	6,259	5,177	10,107
Adjustment for finance income and expenditure	202	242	457
Depreciation and amortisation	728	729	1,435
Loss on disposal of property, plant and equipment	(38)	3	(5)
Increase in inventories	(513)	(702)	(3,969)
Increase in receivables	(3,399)	(2,775)	(1,371)
Increase in payables	993	2,059	647
Own shares non cash amounts	(58)	(53)	(84)
Retirement benefits non cash amounts	(148)	(502)	(1,066)
Share-based payments non cash amounts	29	33	67
Cash generated from operations	4,055	4,211	6,218
6.  Copies of this statement will be posted on our website, www.lathams.co.uk.  A copy can be emailed or posted upon application to the Company Secretary, James Latham plc, Unit 3 Swallow Park, Finway Road Hemel Hempstead, Herts, HP2 7QU, or by email to plc@lathams.co.uk

This information is provided by RNS

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