TIDMEVN
RNS Number : 7459M
Environ Group (Investments) PLC
22 August 2011
22 August 2011
Environ Group (Investments) plc
("Environ Group" or the "Company")
Results for the Year Ended 31 March 2011
Environ Group (Investments) Plc the AIM quoted support services
and fire prevention specialists, today announces its statement of
results for the year ended 31 March 2011.
Key points
-- Gross profit increased 15% to GBP6.4 million (2010: GBP5.5
million).
-- Profit before tax for the year of GBP461,000 (2010: loss of
GBP17.2 million) with improved performance from all three
subsidiaries.
-- Cash at year end GBP237,000 (2010: GBP116,000).
-- Net Assets GBP8.1 million (2010: GBP4.0 million).
-- Streamlined business, now has the necessary accreditation in
the emerging Renewable Energy markets and national operation ready
to take full advantage of government initiatives.
-- Establishment of Midlands based Training Centre to assist in
accreditation of engineers to cope with the expected demand in the
Renewable Energy market.
Commenting on the results Chairman Nigel Wray said:
After an extraordinarily turbulent financial year to 31 March
2010 I am pleased to report a small pre-tax profit for the year to
31 March 2011. As discussed at the interim stage when we in fact
recorded a small loss, every month of the second half has continued
to be profitable. As indeed has the start of the new financial
year.
Our three businesses are in legislation led sectors with strong
growth potential in the future. It is very early days and times
(and margins) are tough but the current year has started
satisfactorily and I would reiterate once again that all of the
Board are substantial shareholders and greatly committed to making
the Group a true success.
Environ Group (Investments) Plc
Mark Sims - Chief Executive
Tel: +44 (0) 1782 826939
Nominated Adviser:
Grant Thornton Corporate Finance
Daniela Amihood
Tel: +44 (0) 207 383 5100
Broker:
Seymour Pierce Limited
Marianne Woods and Jacqui Briscoe
Tel: +44 (0) 207 107 8000
Chairman's Statement
After an extraordinarily turbulent financial year to 31 March
2010 your new Board is pleased to report a small pre-tax profit for
the year to 31 March 2011. As discussed at the interim stage when
we in fact recorded a small loss, every month of the second half
has continued to be profitable. As indeed has the start of the new
financial year.
Some difficult decisions have been taken, costs have been cut
back wherever possible and we now believe that our three subsidiary
companies are well placed in their own fields to benefit from an
upturn when it comes. Other than the convertible loan stock which
is principally owned by the Directors, we have no net bank debt and
hopefully, therefore, are in reasonable shape.
I continue to believe that the provision of decent housing, the
provision of energy saving measures and the protection of buildings
against the risk of fire have all to be significant growth areas
for the future, albeit that the country as a whole is experiencing
one of those 'bumps' along the road.
In addition, from a national security point of view, which
presumably should be a government's first priority, it cannot make
sense to rely on gas and oil from highly unstable regimes. Hence,
the use of solar power, and the adoption of green policies to cut
down our need for fuel from abroad you would have thought is a must
for the future. This is the area we are in and we want to be
in.
It is very early days but the current year has started
satisfactorily and I would reiterate once again that all of the
Board are substantial shareholders and greatly committed to making
Environ a true success.
Nigel Wray
Chief Executive Officer's Report
During the past fiscal year, we have made significant progress
against our key business goals whilst navigating the challenges of
a fiercely competitive market in which we are operating.
We recognise that the future of our business must be in markets
that are driven by both legislation and Renewable Energy solutions.
We firmly believe that in the fullness of time these sectors will
provide organic growth, and that these markets will continue long
into the future - providing the foundation for us to expand into
market leaders.
Over the last 12 months it pleases me that we have reduced
greatly our dependence on the government's Warm Front scheme by
adding many additional clients to our portfolio. Having worked
through that agenda, we have now created a business with a diverse
client base, firmly in the markets which we believe will provide
many opportunities to us in the years to come. The result of the
efforts over the last year have therefore laid the foundation for
further expansion in the medium term, both organically and by way
of further acquisitions, particularly in the Renewable Energy
sector.
Both BGC and Fenhams are now firmly established in the renewable
energy market, and both have gained all of the necessary
accreditation to deliver these services across the whole of the UK.
The government's Feed in Tariff (FIT's) and Renewable Heat
Incentive (RHI) have provided a timely boost to the renewable's
market within the last twelve months. Recently, the EU members
agreed that by 2020, 20% of energy should be sourced from renewable
sources. I firmly believe therefore that this sector will provide
some exciting growth levels over the next few years, as the
government attempts to have an almost seven-fold increase over the
current renewable share of the energy market, in scarcely more than
a decade. It is expected that an investment into the renewable
energy market of over GBP100 billion will be needed within the next
decade in order for the UK to meet these targets.
Ever increasing energy prices and a subsequent increase in fuel
poverty numbers nationally are also set to further drive the market
in which we operate, with projects such as the government's much
talked about Green Deal scheme, for which both BGC and Fenhams are
perfectly placed to secure work within this area.
Further national reports highlighting the ever increasing fuel
poverty levels in the UK, have raised the focus and debate within
the sector as to how these issues should be addressed. This again
should result in yet more emphasis on green solutions, as this
seems the most viable long term solution to the ever spiralling
problem. Our dependence in the UK on other countries to provide our
energy has resulted in a situation where prices are now outside our
control. The long term solution to this problem will almost
definitely be provided by way of Renewable Energy, and again we
intend to be perfectly placed to prosper from this. Our medium term
strategy is to widen our geographical coverage of the UK through
acquisition and organic growth. We are also preparing our Midlands
based training facility in order for us to deliver the
accreditation necessary for the renewable sector, this should give
us another income stream and, more importantly, the kudos of this
should create the foundation for the business to succeed as we
expect. The result of our continued diversification in the next six
months should see us having a fully mobilised national operation
across all renewable solutions. I firmly believe that we have the
ability to become a market leader within this sector, in terms of
both the installation fields and also the training requirements in
this exciting emerging Renewable Energy market.
Construction markets, especially new build markets, have been in
deep recession in the UK. As a consequence IPCL has seen many
contracts delayed and margins have been drastically cut. However,
as a result of many changes in our operations to reduce costs and
improve serviceability, we have stabilised the business in order
for it to trade through these difficult times. We firmly believe
that long term market within the fire protection sector will only
increase; as yet more stringent regulations are imposed upon
construction companies. The blue chip client base that we serve in
this sector clearly highlights the ever increasing reputation our
business is gaining within this sector. Our on-going projects such
as 'The Shard' in London confirm our reputation to be able to
deliver demanding schemes on time, and importantly within budget.
We firmly believe that once the UK market emerges from the current
recession, IPCL will be in prime position to prosper within this
sector.
There is no doubt we have improved our business performance over
the later part of last year, but it's clear that we need to
accelerate our progress to be as profitable and cost efficient as
the rest of the industry. The savings from our recent restructuring
will be reinvested back into the business, enabling us to; continue
to explore the new markets emerging into our sector, improving our
supply chain and building our brands.
Mark Sims
CONSOLIDATED INCOME STATEMENT
For the year ended 31 March 2011
Year ended Year ended
31 March 31 March
2011 2010
GBP'000 GBP'000
Continuing operations
Revenue 19,507 19,085
Cost of sales (13,147) (13,568)
---------- ----------
Gross profit 6,360 5,517
Other administrative expenses (5,881) (6,260)
---------- ----------
Operating Profit/(Loss) before exceptional
items 479 (743)
Exceptional items
Goodwill impairment -- (6,062)
Restructuring costs -- (849)
Acquisition related 258 (161)
Profit/(Loss) from operating activities 737 (7,815)
Net finance expense (276) (392)
---------- ----------
Profit/(Loss) before taxation 461 (8,207)
Income Taxes 212 82
---------- ----------
Profit/(Loss) from continuing operations 673 (8,125)
Profit/ (Loss) from discontinued operations -- (9,035)
Profit/(Loss) for the year 673 (17,160)
========== ==========
Continuing operations
Basic profit/(loss)loss per ordinary
share 0.79p (43.48)p
========== ==========
Diluted profit/(loss)loss per ordinary
share 1.05p (33.58)p
========== ==========
Discontinued operations
Basic profit/(loss)loss per ordinary
share -- (48.34)p
Diluted profit/(loss)loss per ordinary
share -- (37.63)p
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 March 2011
2011 2010
GBP'000 GBP'000
Non current assets
Property, plant and equipment 222 270
Goodwill 12,000 12,000
Total non current assets 12,222 12,270
Current assets
Inventories 223 111
Trade and other receivables 3,369 3,631
Cash and cash equivalents 488 116
-------- --------
Total current assets 4,080 3,858
Total assets 16,302 16,128
-------- --------
Current liabilities
Trade and other payables (4,780) (5,731)
Current tax payable -- (289)
Finance leases (12) (52)
Bank borrowings (251) (2,282)
Deferred cash consideration -- (388)
-------- --------
Total current liabilities (5,043) (8,742)
Non-current liabilities
Finance leases (4) (8)
Deferred tax liability (10) -
Convertible Loan Notes (3,155) (3,205)
Deferred cash consideration -- (188)
-------- --------
Total non current liabilities (3,169) (3,401)
Total liabilities (8,212) (12,143)
-------- --------
Net assets 8,090 3,985
======== ========
Equity
Called up share capital 5,570 4,402
Share premium account 17,747 13,916
Other reserves 276 1,843
Profit and loss account (15,503) (16,176)
-------- --------
Equity Attributable to Equity Holders of the Parent 8,090 3,985
======== ========
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31(st) March 2011
Profit
Called up Share and
share premium Other loss Total
capital account reserves account equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 31 March
2009 3,623 12,626 1,340 984 18,573
Issue of shares (net
of issue costs) 779 1,290 -- -- 2,069
(Loss) for the year -- -- -- (17,160) (17,160)
Shares to be issued
in respect of
acquisitions -- -- 1,003 -- 1,003
Adjustment to
contingent
consideration -- -- (1,250) -- (1,250)
Amounts relating to
earlier
acquisitions -- -- 400 400
Liabilities to be
exchanged for
shares -- -- 300 -- 300
Share based payments;
services provided -- -- 50 -- 50
---------- --------- ---------- --------- ---------
Balance at 31 March
2010 4,402 13,916 1,843 (16,176) 3,985
Issue of shares (net
of issue costs) 1,168 3,332 -- -- 4,500
Profit for the year -- -- -- 673 673
Shares issued in
respect of
acquisitions -- -- (68) -- (68)
Shares issued in lieu
of deferred
consideration -- -- (1,000) -- (1,000)
Transfer to share
premium account -- 499 (499) -- --
Balance at 31 March
2011 5,570 17,747 276 (15,503) 8,090
========== ========= ========== ========= =========
CONSOLIDATED STATEMENT OF CASHFLOWS
For the year ended 31 March 2011
Year ended Year ended
31 March 31 March
2011 2010
GBP'000 GBP'000
Net cash from operating activities (564) (1,325)
Interest and loan arrangement costs (127) (337)
Income taxes paid (67) (291)
Net cash outflow from operating activities (758) (1,953)
---------- ----------
Cashflow from investing activities
Acquisition of subsidiary undertakings
(net of cash) -- (1,166)
Amounts paid in respect of previous
acquisitions (318) (801)
Disposal of subsidiary undertakings
(net of cash) 200 1,289
Purchases of property, plant and equipment (59) (160)
Proceeds from disposal of property,
plant and equipment -- 23
Net cash outflow from investing activities (177) (815)
---------- ----------
Financing
Proceeds from issue of shares 3,600 956
Proceeds from issue of convertible
loan notes -- 3,205
Repayment of convertible loan notes (50) --
Costs of share issue (168) (111)
Proceeds of new bank and other loans -- 575
Repayment of bank loans (2,282) (1,352)
Finance lease repayments (44) (98)
Net cash from financing activities 1,056 3,175
---------- ----------
Net increase in cash and cash equivalents 121 407
---------- ----------
Cash and cash equivalents at start
of year 116 (291)
---------- ----------
Cash and cash equivalents at end of
year 237 116
========== ==========
Comprising of:
Cash and cash equivalents per the balance
sheet 488 116
Less:
Bank overdraft (251) --
Cash, cash equivalents and short term
borrowings 237 116
========== ==========
The above summary of results for the year ended 31 March 2011
does not constitute statutory financial statements within the
meaning of section 434 of the Companies Act 2006 and has not been
delivered to the Registrar of Companies. Statutory financial
statements will be filed with the Registrar of Companies in due
course; the independent auditors' report on those financial
statements under Section 495 of the Companies Act 2006 is
unqualified and does not contain a statement under Section 498(2)
or (3) of the Companies Act 2006.
Environ Group (Investments) Plc's annual report will shortly be
posted to shareholders and will be made available on the Group's
website www.environgroup.co.uk.
This information is provided by RNS
The company news service from the London Stock Exchange
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