RNS No 6317m
JOHNSON SERVICE GROUP PLC
6 August 1999
INTERIM RESULTS 26 WEEKS ENDED 26 JUNE 1999
Johnson Service Group PLC is one of the largest textile rental operators and
the leading drycleaning company in Britain. Its textile rental services
division is a major provider of workwear rental services under the Johnsons
Apparelmaster brand, and a market leader in customer service. Connacht Court
Group, acquired during 1998, is the largest textile rental business in
Ireland. Johnson Cleaners is Britain's largest drycleaner, with 549 shops
nationwide.
SUMMARY
* Turnover from continuing operations up by 21.3% to #79.6 million (1998:
#65.6 million).
* Operating profit from continuing businesses, excluding goodwill
amortisation, up by 21.8% to #12.9 million (1998: #10.6 million).
* Group profit before tax excluding goodwill amortisation and exceptional
items up 12.6% to #12.8 million (1998: #11.4 million).
* Adjusted fully diluted earnings per share increased 11.0% to 15.92p
(1998: 14.34p).
* Interim dividend per Ordinary Share up 10.6% to 3.65p (1998: 3.30p).
* Sale of US drycleaning business, April 1999, with proceeds of #20.5m.
* First time contribution from Connacht Court Group.
* Gearing reduced to 2.3% (December 1998: 44.1%).
Commenting on the results, John Hancox, Chairman, Johnson Service Group, said:
"I am pleased to report further good progress in the first half of 1999 and
that there is now clear evidence that our strategic initiatives of the last
two years are bearing fruit."
Enquiries: Richard Zerny, Chief Executive
Mike Sutton, Finance Director
Johnson Service Group PLC
Telephone: 0171 796 4133 on Friday 6 August 1999 only
thereafter on: 0151 933 6161
Michael Sandler/Wendy Baker
Hudson Sandler Limited
Telephone: 0171 796 4133
INTERIM RESULTS 26 WEEKS ENDED 26 JUNE 1999
GROUP RESULTS AND DIVIDEND
I am pleased to report further good progress in the first half of 1999.
The Group results for the 26 weeks to 26 June 1999 were as follows:*
Turnover from continuing businesses increased by 21.3% to #79.6 million (1998:
#65.6 million) and operating profit, excluding goodwill amortisation,
increased by 21.8% to #12.9 million (1998: #10.6 million). These figures
include a first time contribution from Connacht Court Group (CCG), our Irish
textile rental business acquired in July last year.
The interest charge was slightly higher, at #0.57 million (1998: #0.48
million).
After a reduced contribution from our US drycleaning business, whose profits
were only included in the Group's results up to April 1999, the Group's pre
tax profit, excluding goodwill amortisation and exceptional items, increased
by 12.6% to #12.8 million (1998: #11.4 million) and adjusted earnings per
share on a fully diluted basis increased by 11.0% to 15.92p (1998: 14.34p).
Goodwill amortisation amounted to #0.4 million (1998: Nil). Exceptional items
made a net positive contribution of #2.5 million (1998 loss: #0.2 million) and
consisted of profit on sales of properties of #0.3 million (1998 loss: #0.2
million), reduction in loss on disposal of US business of #1.1 million (1998:
Nil) and profit on the disposal of the interest in our associate, Cleaning
Tokens Ltd., of #1.1 million (1998: Nil). Profit before tax was #14.9 million
(1998: #11.2 million).
Net borrowings at 26 June 1999 were #1.9 million (December 1998: #31.9
million) with gearing of 2.3% (December 1998: 44.1%). This not only reflects
the Group's strong cash flow, but also the receipt of the proceeds of the sale
of our US drycleaning subsidiary of #20.5m.
The Board has decided to pay an interim dividend of 3.65p per Ordinary Share
(1998: 3.30p) an increase of 10.6%.
Note: * The figures for 1999 have been prepared in accordance with the
requirements of the new Financial Reporting Standard 12, "Provisions,
Contingent Liabilities and Contingent Assets", and the figures for 1998 have
been re-stated accordingly.
DIVISONAL TRADING RESULTS
Our British textile rental businesses increased their turnover by 6.5% to
#31.3 million and their operating profit by 8.1% to #7.7 million. The profit
margin improved from 24.3% to 24.7%. Although some sections of our market
were adversely affected by the economy, these were more than offset in other
areas and, coupled with tight cost control, we achieved a satisfactory profit
increase. Stalbridge Linen Services (SLS), our specialist linen hire
subsidiary, continued its strong growth.
Our Irish textile rental business, which we acquired in July 1998, made first-
time contributions to turnover of #11.8 million and to operating profit of
#1.1 million, in line with our expectations. The profit margin was 9.5%. We
have made good progress in the planned re-organisation of this business
including the sale and short term leaseback of the Dublin plant in preparation
for the move to new premises in due course.
Our British drycleaning business increased its turnover by 0.8% to #36.5
million and its operating profit by 17.8% to #4.1 million. After a slow start
to the year, trading gradually improved and finished with a very strong
performance in June. On a like-for-like basis, turnover in the half year was
up 5.4%. The profit margin improved once again, from 9.5% to 11.1%,
reflecting the closure of unprofitable shops and the cost saving from reducing
the number of operating regions from five to four in the second half of 1998.
Our US drycleaning business, which was sold in April 1999, contributed #13.1
million to turnover and #0.5 million to operating profit.
STRATEGIC DEVELOPMENT
In January, 1998, we set out in a circular to Shareholders the main
conclusions of our strategic review of the Group's operations for each of our
divisions.
For textile rental, these included the provision of new high care processing
facilities at Letchworth and Exeter, further expansion and investment at SLS
and the launching of a new washroom services business. We have carried out
these commitments and in addition we have modernised and expanded our Brighton
and Cardiff laundries. We see continuing growth from our British textile
rental businesses, including further expansion of SLS, our specialist linen
hire division. We also plan to grow our dedicated washroom services business,
launched in December 1998, quickly over the next few years, building on our
extensive textile rental customer base.
In 1998 we also set ourselves the goal of achieving growth from acquisitions
where possible, and our purchase of CCG, Ireland's largest textile rental
company, in July last year, was in line with this policy. The re-organisation
of our Irish textile rental business is well underway and there are excellent
prospects for growth and improving the margin.
We continue our active search for acquisitions for our textile rental
operations in both Britain and Ireland.
For drycleaning, establishing Britain's largest drycleaning brand by the
middle of 1999 was our main goal. This has been achieved and the results have
exceeded our expectations, with a much improved margin. Our drycleaning
business is now the brand leader in Britain with 549 shops. It has sufficient
critical mass to justify TV advertising in most regions and this has already
improved brand awareness on a national scale. There are now 400,000 members
of the Priority Club, and the business is benefiting from the new Electronic
Point of Sale system and the Central Processing Unit for the specialist
cleaning of items which cannot normally be processed in conventional shops.
We are seeking suitable drive-in locations around the country and also
expansion into areas where we are currently under-represented. Now that the
re-branding programme is substantially complete, cash flow is strong.
Whilst these developments have been going on, we have disposed of both our US
textile rental business (in January 1998) and our US drycleaning business (in
April 1999), neither of which seemed to us likely to contribute to our aim of
enhancing shareholder value in the future.
As a result the Group is now focused on Britain and Ireland, with strong
brands and high levels of service in all its businesses. Our strong cash flow
and low borrowings give us the ability to make significant acquisitions.
OUTLOOK
We remain confident of achieving a satisfactory performance in the full year.
Copies of the interim report are to be sent to shareholders and will be
available to the public at the Company's registered office at Mildmay Road,
Bootle, Merseyside L20 5EW. The report can also be accessed on the Internet
at: www.johnsonservicegroup.co.uk.
John Hancox Richard Zerny
Chairman Chief Executive
CONSOLIDATED PROFIT AND LOSS ACCOUNT
Note 26 WEEKS 26 WEEKS 52 WEEKS
JUNE JUNE DECEMBER
1999 1998 1998
#000 #000 #000
RESTATED RESTATED
TURNOVER - Continuing operations 2 79,624 65,638 144,122
- Discontinued operations - USA 13,107 28,209 54,254
====== ====== ======
- Total 92,731 93,847 198,376
====== ====== ======
OPERATING PROFIT - Continuing operations 2 12,913 10,604 22,343
- Discontinued
operations - USA 481 1,273 2,057
====== ====== ======
OPERATING PROFIT BEFORE GOODWILL
AMORTISATION 13,394 11,877 24,400
Amortisation of goodwill - Continuing (419) - (384)
====== ====== ======
OPERATING PROFIT 12,975 11,877 24,016
EXCEPTIONAL ITEMS 3
Exceptional items - Continuing operations 1,427 (223) 32
Disposal of US business - Discontinued operations 1,093 - (40,349)
---------------- --------
PROFIT ON ORDINARY ACTIVITIES
BEFORE INTEREST 15,495 11,654 (16,301)
Net interest (568) (484) (1,414)
---------------- --------
PROFIT ON ORDINARY ACTIVITIES
BEFORE TAXATION 14,927 11,170 (17,715)
Tax on profit on ordinary activities 4 3,996 3,436 7,203
---------------- --------
PROFIT FOR THE PERIOD 10,931 7,734 (24,918)
Dividends 5 2,209 2,069 7,991
====== ====== ======
RETAINED PROFIT FOR THE PERIOD 8,722 5,665 (32,909)
====== ====== ======
RATES OF DIVIDEND PER SHARE
Ordinary shares of 10p each:-
1st interim - paid - 3.30p 3.30p
1st interim - proposed 3.65p - -
Final - paid - - 11.00p
Preference shares of #1 each - paid - 3.15p 3.75p
Preference shares of 10p each - paid 3.75p 3.75p 7.50p
BASIC EARNINGS PER SHARE 6 20.82p 14.64p (51.53)p
Adjustment for goodwill amortisation 0.82p - 0.77p
Adjustment for sale of investment
after taxation (2.12)p - -
Adjustment for sales of properties
after taxation (0.68)p 0.45p (0.05)p
Adjustment for disposal of US operations
after taxation (2.15)p - 80.75p
====== ====== ======
ADJUSTED BASIC EARNINGS PER SHARE 16.69p 15.09p 29.94p
====== ====== ======
FULLY DILUTED EARNINGS PER SHARE 6 19.71p 13.94p (45.05)p
Adjustment for goodwill amortisation 0.75p - 0.69p
Adjustment for sale of investment
after taxation (1.94)p - -
Adjustment for sales of properties
after taxation (0.63)p 0.40p (0.06)p
Adjustment for disposal of US operations
after taxation (1.97)p - 72.90p
====== ====== ======
ADJUSTED FULLY DILUTED EARNINGS PER SHARE 15.92p 14.34p 28.48p
====== ====== ======
Figures for 1998 have been restated to comply with the provisions of FRS12.
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
There are no material gains or losses other than the profit for the period.
CONSOLIDATED BALANCE SHEET
Note JUNE JUNE DECEMBER
1999 1998 1998
#000 #000 #000
RESTATED RESTATED
FIXED ASSETS
Goodwill 15,201 262 16,735
Tangible assets 79,517 88,830 98,154
Textile rental items 21,829 15,678 22,296
Investments 8 749 1,187 1,406
====== ====== ======
117,296 105,957 138,591
====== ====== ======
CURRENT ASSETS
Stocks 3,538 3,976 4,405
Debtors: Amounts falling due within one year 20,026 19,083 22,456
: Amounts falling due after more
than one year - 2,567 661
Cash at bank and in hand 19,799 145 2,494
====== ====== ======
43,363 25,771 30,016
====== ====== ======
CURRENT LIABILITIES
Creditors:
Amounts falling due within one year (34,050) (34,951) (38,268)
----------------- --------
NET CURRENT ASSETS 9,313 (9,180) (8,252)
---------------------------
TOTAL ASSETS LESS CURRENT LIABILITIES 126,609 96,777 130,339
Creditors:
Amounts falling due after more than one year (20,533) (1,631) (31,618)
PROVISIONS FOR LIABILITIES AND CHARGES (8,460) (7,590) (9,675)
====== ====== ======
NET ASSETS 97,616 87,556 89,046
====== ====== ======
CAPITAL AND RESERVES
Called-up share capital 6,045 6,586 6,117
Share premium account 9 3,953 3,696 3,726
Revaluation reserve 9 13,694 15,359 14,547
Other reserves 9 1,880 256 888
Profit and loss account 9 72,044 61,659 63,768
====== ====== ======
SHAREHOLDERS' FUNDS 10 97,616 87,556 89,046
====== ====== ======
Non equity Shareholders' funds 9,191 11,252 10,781
Equity Shareholders' funds 88,425 76,304 78,265
====== ====== ======
97,616 87,556 89,046
====== ====== ======
The Interim Statement was approved by the Board of Directors on 6 August 1999.
CONSOLIDATED CASH FLOW STATEMENT
Note 26 WEEKS 26 WEEKS 52 WEEKS
JUNE JUNE DECEMBER
1999 1998 1998
#000 #000 #000
RESTATED RESTATED
Operating profit 12,975 11,877 24,016
Depreciation 12,614 10,152 23,456
Loss on sale of tangible fixed assets 202 209 855
Working capital and other items (net) (2,203) 132 10
----------------- ---------
NET CASH INFLOW FROM OPERATING
ACTIVITIES 23,588 22,370 48,337
----------------- ---------
RETURNS ON INVESTMENTS AND SERVICING
OF FINANCE
Net interest paid (640) (676) (1,077)
Preference dividends paid (404) (438) (860)
----------------------------
NET CASH OUTFLOW FROM RETURNS ON
INVESTMENTS AND SERVICING OF FINANCE (1,044) (1,114) (1,937)
====== ====== ======
TAXATION
Tax paid (net) (651) (2,028) (8,396)
CAPITAL EXPENDITURE AND FINANCIAL
INVESTMENT
Payments to acquire tangible fixed assets (5,764) (6,102) (13,846)
Payments to acquire textile rental items (8,525) (6,583) (15,368)
Receipts from sales of tangible fixed assets 5,115 653 2,918
Proceeds from textile rental items
withdrawn from circulation 1,505 1,211 2,500
Movement in investment 1,692 (150) (150)
----------------------------
NET CASH OUTFLOW FOR CAPITAL
EXPENDITURE AND FINANCIAL INVESTMENT (5,977) (10,971) (23,946)
====== ====== ======
ACQUISITIONS AND DISPOSALS
Payment to acquire businesses 11 (240) (279) (25,711)
Net overdrafts acquired with subsidiary
undertakings - - (1,201)
Receipt from disposal of US businesses 11 20,500 16,918 17,440
Cash disposed of with US business (464) - -
---------------------------
NET CASH INFLOW FROM ACQUISITIONS
AND DISPOSALS 19,796 16,639 (9,472)
====== ====== ======
EQUITY DIVIDENDS PAID (5,519) (4,782) (6,436)
----------------------------
CASH INFLOW BEFORE FINANCING 30,193 20,114 (1,850)
----------------------------
FINANCING
Issue of Ordinary share capital 237 174 205
Repayment of 6.3% Preference shares - - (471)
Debt due within 1 year:
Loan notes redeemed (658) (24) (620)
Debt due beyond 1 year:
Movement in unsecured loans (11,164) (21,461) 5,010
Finance lease movement (512) (260) (762)
----------------------------
NET CASH OUTFLOW FROM FINANCING (12,097) (21,571) 3,362
====== ====== ======
INCREASE IN CASH IN THE PERIOD 12 18,096 (1,457) 1,512
====== ====== ======
JOHNSON SERVICE GROUP PLC
NOTES
1. Prior year adjustment
The Group has changed its accounting policy regarding the treatment of
costs arising on non trading short leasehold properties to comply with
the provisions of Financial Reporting Standard 12, "Provisions,
Contingent Liabilities and Contingent Assets", and now provides for the
anticipated net costs, after taxation, at the time the property ceases to
be used for trading purposes. Consequently the Group charged #1.3m to
reserves at 26 December 1998 and restated the profit and loss account by
the following adjustments:-
26 WEEKS 52 WEEKS
JUNE 1998 DECEMBER 1998
#000 #000
Operating profit charge 63 366
Disposal of property credit (131) (426)
Taxation credit (19) (113)
The balance sheets, cash flows and earnings per share have also been
restated accordingly.
In addition provisions in respect of the Group's self insurance
arrangements are now disclosed within "Provisions for Liabilities and
Charges" rather than within "Current Liabilities" and the balance sheets
have been restated accordingly.
2. Segmental information
26 WEEKS 26 WEEKS 52 WEEKS
JUNE 1999 JUNE 1998 DEC 1998
#000 #000 #000
RESTATED RESTATED
Continuing Operations
GB Rental
Turnover 31,332 29,415 59,934
Profit 7,727 7,150 14,738
GB Drycleaning
Turnover 36,519 36,223 73,146
Profit 4,070 3,454 6,548
IR Rental
Turnover 11,773 - 11,042
Profit 1,116 - 1,057
-------- -------- --------
Total Continuing
Turnover 79,624 65,638 144,122
Operating profit before
amortisation of goodwill 12,913 10,604 22,343
-------- -------- --------
There is no material difference between turnover by origin and by
destination.
NOTES cont...d
3. Exceptional items
26 WEEKS 26 WEEKS 52 WEEKS
JUNE JUNE DECEMBER
1999 1998 1998
#000 #000 #000
RESTATED RESTATED
Continuing Operations
Gain on disposal of fixed asset
investment 1,078 - -
Gain on sales of property fixed
assets 349 (223) 32
-------- -------- --------
Total continuing operations 1,427 (223) 32
Discontinued Operations
Disposal of US operations 1,093 - (40,349)
-------- -------- --------
2,520 (223) (40,317)
-------- -------- --------
The gain on disposal of a fixed asset investment relates to the disposal
of the investment in Cleaning Tokens Ltd, an associate, for #1.7 million
in cash.
The disposal of the whole of the issued share capital of the US
subsidiary, Johnson Group, Inc. for #20.5 million in cash and up to $18
million in loan notes and convertible preferred stock was completed in
April 1999 resulting in a loss of #39.256 million, #1.093 million less
than the estimate reflected in the 1998 accounts.
4. Tax on profit on ordinary activities
26 WEEKS 26 WEEKS 52 WEEKS
JUNE JUNE DECEMBER
1999 1998 1998
#000 #000 #000
RESTATED RESTATED
Taxation has been estimated at:
Continuing Operations:
UK corporation tax 4,018 3,121 6,301
Irish corporation tax 308 - -
Irish corporation tax on property
disposals 967 - -
-------- -------- --------
5,293 3,121 6,301
UK deferred tax (172) 77 236
Irish deferred tax (1,145) - -
-------- -------- --------
Total Continuing Operations 3,976 3,198 6,537
===== ===== =====
Discontinued Operations:
US State and Federal taxation 20 238 666
-------- -------- --------
TOTAL 3,996 3,436 7,203
===== ===== =====
NOTES cont...d
5. Dividends
26 WEEKS 26 WEEKS 52 WEEKS
JUNE JUNE DECEMBER
1999 1998 1998
#000 #000 #000
Dividend on Ordinary shares 1,864 1,650 7,165
Dividend on #1 Preference shares - 15 18
Dividend on 10p Preference shares 345 404 808
-------- -------- --------
2,209 2,069 7,991
====== ====== ======
The first interim dividend, of 3.65p, on the Ordinary shares will be paid
on 1 October 1999 to those Shareholders registered in the books of the
Company at 6 September 1999. The dividend on the 10p Convertible
preference shares was paid on 1 July 1999.
6. Earnings per share
26 WEEKS 26 WEEKS 52 WEEKS
JUNE JUNE DECEMBER
1999 1998 1998
#000 #000 #000
RESTATED RESTATED
Profit for the period 10,931 7,734 (24,918)
Less dividend on Preference shares 345 419 826
-------- -------- --------
Profit attributable to Ordinary
Shareholders 10,586 7,315 (25,744)
Less gain on exceptional items (2,520) 223 40,317
Add goodwill amortisation 419 - 384
===== ===== =====
Adjusted profit attributable to Ordinary
Shareholders 8,485 7,538 14,957
===== ===== =====
Weighted average number of Ordinary
shares 50,835,468 49,956,674 49,963,643
Fully diluted number of Ordinary
shares 55,455,884 55,372,885 55,352,942
Earnings per share is calculated in accordance with the requirements of
FRS14. In addition to the restatement arising from the prior year
adjustment explained in note 1 the figures for the 26 weeks to June 1998
have also been restated to comply with the requirements of FRS14.
Adjusted earnings per share figures are given to exclude the effects of
goodwill amortisation and exceptional items, net of taxation.
7. Land and Buildings
Land and buildings are included within tangible fixed assets at the
valuation adopted in the financial statements for the year to 26 December
1998.
NOTES cont...d
8. Investments
JUNE JUNE DECEMBER
1999 1998 1998
#000 #000 #000
Investment in 256,940 (1998: 252,549)
Ordinary shares of the company at cost
(Nominal value #25,694 (1998: #25,255)
in respect of the Long Term Incentive Plan 749 697 697
Investment in associate (note 3) - 490 709
-------- -------- --------
749 1,187 1,406
===== ===== =====
9. Reserves
Other Reserves
---------------------------------------------
Share Revaluation Exchange Capital Merger Profit &
Premium Reserve Reserve Redemption Reserve Loss
Account Reserve Account
#000 #000 #000 #000 #000 #000
At 26 December
1998 3,726 14,547 (1,172) 509 1,551 65,096
Prior year adjustment
(note 1) - - - - - (1,328)
------------------------------------------------------
At 26 December 1998
(as restated) 3,726 14,547 (1,172) 509 1,551 63,768
Premium on issue
of shares
(nominal value of
#10,056) 227 - - - - -
Goodwill on
disposals - - - - - 248
Retained profit - - - - - 8,722
Transfer of
realised profits - (853) 1,547 - - (694)
Arising on conversion - - - 82 - -
Exchange movement - - (637) - - -
====== ====== ====== ====== ====== ======
At 26 June 1999 3,953 13,694 (262) 591 1,551 72,044
====== ====== ====== ====== ====== ======
NOTES cont...d
10. Reconciliation of movements in Shareholders' funds
26 WEEKS 26 WEEKS 52 WEEKS
JUNE JUNE DECEMBER
1999 1998 1998
#000 #000 #000
RESTATED RESTATED
Profit for period 10,931 7,734 (24,918)
Dividends 2,209 2,069 7,991
-------- -------- --------
8,722 5,665 (32,909)
Other recognised gains and losses
relating to the period (637) 158 317
Preference shares repaid - - (471)
New share capital subscribed 10 7 8
Net reduction in share capital on
conversion (82) (25) (25)
Share premium 227 167 197
Capital redemption 82 26 26
Goodwill on disposals 248 5,038 45,383
-------- -------- --------
Net addition to Shareholders' funds 8,570 11,036 12,526
Opening Shareholders' funds (as restated) 89,046 76,520 76,520
====== ====== ======
Closing Shareholders' funds 97,616 87,556 89,046
====== ====== ======
NOTES cont...d
11. Acquisitions and Disposals
Purchase of Businesses 26 WEEKS 26 WEEKS 52 WEEKS
JUNE JUNE DECEMBER
1999 1998 1998
#000 #000 #000
Net assets acquired
Tangible fixed assets 17 62 10,470
Stocks of textile rental items 33 - 6,333
Stocks 3 6 690
Debtors - - 3,829
Net overdraft - - (1,201)
Creditors (42) - (5,799)
Deferred tax - - (1,303)
Loans and finance agreements - - (3,685)
-------- -------- --------
11 68 9,334
Goodwill 229 270 16,377
====== ====== ======
Total consideration 240 338 25,711
====== ====== ======
Discharged by cash on completion 240 279 25,711
Deferred consideration - 59 -
====== ====== ======
240 338 25,711
====== ====== ======
Disposal of US Businesses
Net assets disposed of
Fixed assets 15,669 4,489 5,197
Stocks of textile rental items - 3,463 3,463
Stocks 927 1,026 1,026
Cash 464 - -
Debtors 4,356 2,902 2,716
Creditors (2,257) - -
Goodwill previously written off to reserves 248 5,038 5,038
Reduction in loss on disposal 1,093 - -
====== ====== ======
Satisfied by cash 20,500 16,918 17,440
====== ====== ======
The 1999 figures relate to the disposal of the US business which was
completed in April 1999.
NOTES cont...d
12. Reconciliation of net cash flow to movement in net debt
26 WEEKS 26 WEEKS 52 WEEKS
JUNE JUNE DECEMBER
1999 1998 1998
#000 #000 #000
Increase in cash in the period 18,096 (1,457) 1,512
Cash inflow on decrease in debt
and lease financing 12,334 21,744 (3,628)
-------- -------- --------
Change in net debt resulting from
cash flows 30,430 20,287 (2,116)
Finance leases - new (1,603) (1,254) (1,431)
Loans and leases acquired with subsidiary - - (3,685)
Exchange differences 1,179 (174) (746)
-------- -------- --------
Movement in net debt in period 30,006 18,859 (7,978)
Opening net debt (31,864) (23,886) (23,886)
====== ====== ======
Closing net debt (1,858) (5,027) (31,864)
====== ====== ======
13. Analysis of net debt
At 26 Other At 26
December Cash Non-cash Exchange June
1998 Flow Changes Movement 1999
#000 #000 #000 #000 #000
Cash in hand and at bank 2,494 17,357 - (52) 19,799
Overdraft (876) 739 - 27 (110)
Debt due after one year (29,839) 11,164 - 1,175 (17,500)
Debt due within one year (917) 658 - (1) (260)
Finance leases (2,726) 512 (1,603) 30 (3,787)
====== ====== ====== ====== ======
(31,864) 30,430 (1,603) 1,179 (1,858)
====== ====== ====== ====== ======
14. The interim results have been prepared on the basis of accounting policies
set out in the Group's 1998 statutory accounts. In addition the new
requirements of FRS12 "Provisions, Contingent Liabilities and Contingent
Assets" have been complied with for the first time, and prior years
restated. The profit and loss accounts, balance sheets and cash flow
statements as at June 1999 and June 1998, as restated, are unaudited and
have not been reviewed by the auditors. The financial information does
not amount to full accounts within the meaning of Section 240 of the
Companies Act 1985 (as amended).
The profit and loss account, balance sheet and cash flow statement for
December 1998, as restated, are abridged from the Group's full accounts
for that year. Those accounts received an unqualified audit report and
have been filed with the Registrar of Companies. The auditors' report
did not contain a statement under Section 237(2) or (3) of the Companies
Act 1985 (as amended).
NOTES cont...d
15. Rates of exchange
The following rates of exchange for the Irish Pound have been used:
JUNE 1999 DECEMBER 1998
Average Rate IR#1.17 IR#1.13
Closing Rate IR#1.20 IR#1.13
16. Year 2000 and Euro
The Group has undertaken an extensive review of the implications of the
Year 2000 on its financial and operational systems and equipment.
A Group Steering Committee, which reports regularly to the Group Board,
has formulated a detailed action plan to ensure that, in relation to both
internal, and where relevant, external risks:-
- Staff at all levels are aware of the process.
- Business critical systems are fully tested and corrected where
necessary.
- Suppliers and customers are taking appropriate action.
The Group is at an advanced stage of achieving compliance, with many of
its systems and equipment already fully tested, and all testing will be
complete well in advance of December 1999.
Neither the current nor the future capital and revenue costs of the Year
2000 project are considered significant.
The introduction of the Euro is not expected to have a material impact on
the Group.
END
IR DEFFBKVKZBKF
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